Tips to Reconcile Your Bank Account

Don't just toss your monthly bank statements into a drawer. Take time to go through your statements and reconcile your checking or savings accounts to catch bank errors, spot fraudulent activity, and keep track of how much money you have.

Account Reconciliation Process

Bank account reconciliation should be done each month. Waiting too long to reconcile your savings or checking account increases the potential for making mistakes during the process and ups the chance that your account could be compromised. Use these tips to help make bank account reconciliation easier and less stressful.

1. Record all transactions in your checking or savings account register. Save your receipts and ATM slips for all deposits (credits) and withdrawals (debits) so you can check them when you receive your bank statement. Your statement's ending balance probably won't match the balance on your account register if there are transactions that haven't yet cleared.
2. Place a check mark next to all transactions that appear on your statement, such as deposits, interest, checks, electronic transfers, fees, and ATM withdrawals. These items have been cleared at the bank. If your statement shows interest earned or banking fees that you haven't recorded in your register, write them in now and adjust your register's balance accordingly.
3. Add up all deposits that you recorded in your register but that are not on your statement. These items have not cleared yet.
4. Total up any withdrawals, including fees, that aren't on the statement but that are recorded in your register. These items also haven't cleared yet.
5. To do a reconciliation, you'll need to write down the ending balance from your account statement, then add the amount of the deposits that have not cleared yet.
6. Subtract the amount of all withdrawals that were not on the statement. This reconciled balance should agree with the amount in your register.

Double-Check Yourself

If your reconciled balance does not match what is in your register, you'll need to go back and look at each transaction to make sure you recorded the correct figures. First, see if the difference is divisible by 9. If it is, you probably transposed a number--for example, recording a $75 check as $57. The difference, $18, is divisible by 9.

Look for discrepancies between what you recorded in your register and what showed up on the statement.If you think you incorrectly recorded the amount of a check in your register, get a copy of the check to confirm the amount. If the statement shows an incorrect amount, contact your bank to clear up the problem.

Also look for transactions that show up on the statement but that you forgot to record in your register. If you seem to be short a lot of money, make sure that all your deposits from previous statement periods have cleared.

Reconciling your accounts will not only help you stay on top of how much cash you have, but also will help you determine if you're paying too much for monthly service fees, overdraft charges, ATM fees, or other transactions.

If you're really having a tough time with an account reconciliation, contact your bank and have someone go through the transactions with you.

 

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