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Using Checks
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Using Checks



Personal Finance - Banking Unit

Personal Finance - Banking Unit



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Using Checks Using Checks Presentation Transcript

  • Personal Finance Using Checks & Other Payment Methods
  • Check-Writing Procedures
    • Keep record of transactions
    • in a check register
      • Separate book, usually same size as checkbook
      • Provides blanks to fill in information about checks
    • on check stubs
      • Form attached to the check by a perforated line
      • After check is written, it is torn off at the line and the stub remains in the checkbook
    • When writing a check, always fill in register or stub first .
  • Writing a Check
    • Write checks in order by number.
    • Write the date in the proper space.
    • Write the payee’s name
    • Write the amount of check in figures.
      • Write close to the dollar sign
      • Write cents close to the dollar figure
    • 5. Write amount of dollars in words.
  • Writing a Check (Cont.)
    • Write amount of dollars in words.
      • Write the cents in figures as a fraction
      • Begin writing at the far left end of the line
      • Draw a line from the fraction to the printed word Dollars
    • Write the purpose of the check.
    • Sign your check.
    • The bank may subtract only amounts of checks and EFT transactions that the depositor has authorized.
    • Bank may be responsible if it cashes a checked signed by someone who had no right to use the depositor’s signature.
    • Forgery – Writing another person’s signature on a check without his/her authority. It’s a crime.
  • Tips for Good Check Writing
    • Write checks only on the forms provided by your bank.
      • *MICR – Magnetic Ink Character Recognition
    • Write checks in ink.
    • Only write checks if you have money in your account to cover them.
    • Use the current date.
    • Avoid making checks payable to Cash or to Bearer.
    • Always fill in the amount.
    • Void checks on which you make errors. Do not try to erase or retrace your writing.
    • Record every payment from your checking account, whether payment is by check or EFT.
  • Stopping Payment on a Check
    • Fill out a stop-payment order – written notice from the drawer telling the bank not to pay a certain check.
      • You need date, check number, amount, payee, and drawer’s signature.
      • Bank charges fee for this service.
  • Accepting & Cashing Checks
    • Legally, no one has to accept your checks.
    • You may be asked for valid identification.
    • --Driver’s license
    • --School ID card
    • --Picture Debit/Credit Card
  • Other Types of Checks
    • Certified Check – personal check for which a bank has guaranteed payment
      • Certification is stamped on the face of the check and signed by bank officer.
      • Amount is immediately withdrawn from account.
    • Cashier’s Checks – check that a bank draws on its own in-house funds.
  • Other Types (Cont.)
    • Traveler’s Checks – Special forms designed for the traveler to use in making payments.
      • May be purchased at banks, express companies, credit unions.
      • Sold in $10, $20, $50, and $100.
      • Sometimes a charge (1-2%)
      • Can be replaced if lost or stolen.
  • Sources of Money Orders
    • Money Order – form of payment that orders the issuing agency to pay the amount printed on the form to another party.
      • Bank Money Order
      • Postal Money Order
      • Express Money Order.
        • Sold by American Express Company, Traveler’s Express Company, supermarkets, etc.
      • Telegraphic Money Orders
        • Mainly used in emergency situations. Money is “wired” to another individual.
    • EFT – Electronic Fund Transfer
      • Moving funds via a computer (ATM machine)
      • Bills automatically deducted from your account each month.
      • Using debit cards for purchases.
      • On-line banking to pay bills.
      • Direct Deposits – paychecks deposited by employer electronically.
    The End!