I met Abby at a networking event. She told me she doesn’t need to balance her checkbook. I asked her why does she think that? Abby said she looks at her bank balance online everyday so she knows how much money is in the account. So I challenged Abby to write out a list of her monthly bills and compare it to the bank statement. I also asked her to count how many NSF (Non-Sufficient Funds) charges she gets in one month.
The next week Abby called me and asked to meet with me. When we sat down and looked at her list that was compared to the bank statement she found that she was paying for things she didn’t know she was paying for. Like that club membership that she hasn’t used in a year, and that the bank was taking $25.00 per week and she didn’t know why. So I had her call the bank about the $25.00 was being transferred to an account in her name that she didn’t know about. She found that she had $2,500.00 in an account she didn’t know about.
Then she showed me the amount of NSF charges for the month: $150.00. So I asked her why she thought she got that many NSF charges. Abby looked at each of them, two were because she didn’t know about the $25.00 for the unknown and the club membership coming out. One was she forgot her insurance withdraw, was coming through. One was the bank deposited the wrong amount. YES the bank makes mistakes also. So we called the bank and had them research the deposit and they found their error. Since it was the bank’s error they reversed the NSF charge. The other was an outstanding check she forgot about that wasn’t deposited until 6 weeks after she wrote the check.
So if Abby would have set up a check register or used an accounting software and balanced the checkbook monthly or weekly, Abby would not have had $150.00 in NSF charges, and she found $2,500.00 that she didn’t know she had!
A couple of months later I asked Abby how bank balancing was coming along. She said GREAT!!! No more NSF charges and it’s helping me know how much money I actually have available to spend which helps me know what happened to my money. Great I said next we can look at setting up a budget so you can tell your money what to do instead of seeing where it’s been.