Organization is the first step to responsible money management. It saves time, money and headaches in the future. To help you know what bills you have, when they are due and how much you owe, start by creating a filing system and keeping copies of the following items:
- Receipts for cash, credit and debit card purchases
- Bill notices
- Bank statements
- Credit card bills
- Paycheck stubs
- Receipts for any tax deductible expenses
- Credit contracts and any other financial documents
Monitor Your Checking Account
Pay attention to your checking account to make sure you’re not spending more money than you take in. Keep your receipts and make sure they match what’s on your statement. You also should do the following:
- Review your checking account statement every month. If you have online banking, you can monitor your account more often.
- Use your monthly statement or online banking to reconcile the balance in your checkbook.
- Know the accurate, up-to-date balance of your checking account.
- Realize the balance you get from the ATM machine or the 1-800 number does not necessarily reflect the actual amount available in your account. If there are checks you have written that have not yet cleared your account, your balance may appear greater than it actually is.
If you don’t know how to determine your balance, ask your bank or credit union for help. You may also find a worksheet on the back of your statement to help reconcile your account or you may use Cash Course’s Balancing Your Bank Account Worksheet.
A history of “bounced” or non-sufficient funds (NSF) checks not only costs you money in penalty fees but also negatively affects your credit report, costs you more in higher interest rates and keeps you from getting more credit or even a job. Keep in mind, a positive credit history is an asset when you apply for a credit card, job, insurance, or a loan to finance a car or home.