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    Chuck the Checkbook

    Friday, December 25th, 2009 at 3:28 PM | Banking, Simplification
    Balancing your personal checkbook is not as necessary as it once was. In fact it’s not necessary at all. Ten years ago you’d have to wait for a statement showing what checks cleared. Times have changed. Here are a few ways for you to get rid of the checkbook and the balancing chore that goes with it.

    Stop Writing Checks
    First thing is first. In order to eliminate the checkbook you have to stop writing checks. While you may not be able to do it cold turkey, in most cases you can use other means of payment. For example you can use your credit/check-card or a BillPay type service.  Electronic transactions like plastic and BillPay clear within a day or so.


    What is BillPay?
    Most banks now offer a BillPay type feature, however it may be called by another name. It is even free with many banks and account types. BillPay basically enables you to create a list of companies or people that your bank will send payment to. In a few clicks you can add a new payee and send a payment. There is no cost to your recipient. The payment comes out of your account the very next day and the payment is sent. If your payee is a small vendor, friend or local business they will get a check from you (generated by your bank) in the mail (at no postage cost to you).

    Free or not, BillPay is worth every penny if it means you don’t have to write checks or balance a checkbook. An added feature to BillPay (there are many) is the ability to track payments. You can see all the payments you made to any vendor, when the check was negotiated/cashed and more.

    Here are a few common payment examples:

    Rent
    Pay your rent via BillPay. While you are at it set it up as a recurring transaction and never worry about late charges. Your landlord will simply get a check from you each month. If the bank makes a mistake and it is late, they will even pay your late fee in most cases.

    Mortgage
    Most all mortgages offer a EFT payment option that comes right out of your checking/savings account. Set it up monthly and don’t worry about late fees.

    Utilities
    Just chuck those prepaid envelops the utility companies send you. Log onto their website and setup online statements and automatic payments. Have it charged to your credit card if you are concerned with cash-flow or your checking account balance.

    Friends/Family
    Let your friend know you will send him/her a check. If your friend has a problem with that you may want to re-think your financial relationship with that person since trust is a problem. Better yet, if you both have Paypal accounts send them money via PayPal. This will save your friend a trip to the ATM to deposit the check your BillPay sent them.

    Discuss Spending Rules
    If you are sharing a checking account with your spouse it is good to have some guidelines. Determine a preset limit for electronic purchases and a minimum balance. It’s a drag when your wife just paid the bills and you are stuck in line with a denied card. If either of you notice the account’s below your agreed minimum then one of you need to transfer funds asap. If you are shopping and your transaction is larger than your preset spending limit use your credit card so you don’t drain the checking account.

    Track Transactions/Balances Online
    Since you aren’t writing checks and longer and don’t have a ledger, you will need to keep an eye on your balance via online banking. The frequency you check your account balance depends on the amount of transactions you have. Remember essentially you are using your online banking records as a checkbook. You used to check your checkbook each time you wrote a check, so you’ll need to keep a eye on your balance just as often. Learn more about easy expense tracking.

    Talking Poin
    t: What are some types of transactions that you still write checks for?
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    8 responses to “Chuck the Checkbook”

    1. ashley says:

      Ok, so I’ve read through this article and I can appreciate some of the advice. I must say I strongly disagree with part of it. I am a personal banker with a large bank, and I must say that I would NEVER, EVER advise someone to not use a register! As a banker, both myself and upper management cringe when we hear someone say that they don’t use a register because they rely on online banking. In fact, if they are asking us to reverse fees, that is the first question I will ask. Online banking is not something you can rely on because if you shop at a mom and pop store, they are not required to process their transactions immediatley. So please people, use your register especially if you are on a fixed income. It takes just a second to write it down, because sometimes you forgot about that energy drink you bought yesterday and if I don’t see you making an effort to keep track of your balance, you really aren’t making a good argument on why I should reverse all your fees.

    2. Sisterlisa says:

      Ashley, I see your point, but the author linked to how to track your spending in other ways.
      I stopped using personal checks years ago. I was reluctant to use online banking, but I eventually gave it a shot and love it. We keep a good amount in savings in case I need to make a transfer, but we keep an eye on our account diligently to know our balance and we stop spending if we get to a certain point in our balance. Since we have very few bills to pay, we know we’re safe from over-drafting. We know what we’ve spent and what scheduled payments are going to be deducted.

    3. It was interesting. You seem very knowledgeable about banking.

    4. amazing stuff thanx 🙂

    5. Super-Duper site! I am loving it!! Will come back again – taking you feeds also, Thanks.

    6. Zelma Gauch says:

      This is a nice blog, Going On.

    7. Harry Carneal says:

      Okay article. I just became aware of your blog and desired to say I have really enjoyed reading your opinions. Any way I’ll be subscribing in your feed and Lets hope you post again soon.

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