Whether you’re an individual employee or a small business owner, it’s always a good idea to review your bank statements on a regular basis. Your bank statements are the key to keeping track of everything in your accounts —make sure transactions are documented properly, monitor for fraud, keep a close eye on saving versus spending, and track the amount of interest you’ve accrued over time.
Simply put, your bank statements are an essential tool for smart money management. Here are a few things to know about bank statements and their importance.
What Information Can I Find in a Bank Statement?
Your bank statements allow you to see every transaction made in your accounts throughout a certain period, which includes what is going into and coming out of your accounts (deposits, withdrawals, and fees). Bank statements are intended to be a way to understand your finances, but they can sometimes be overwhelming. These are the typical key sections included in a bank statement.
The statement period — This shows you the dates of the statement cycle, which might be written as “Statement ending” on a particular date or may include a to/from date range.The bank’s information — Near the top you’ll find customer service contact details and other information for accessing the bank’s website and mailing address to make payments.Your personal information — This will include your name, address, phone number, and other pertinent personal information. It’s important to ensure that these details are correct on your statement.The account summary — This will show you a high-level view of your account balances as well as deposit, withdrawal, and fee totals.Your interest earned — Savings accounts, certificates of deposit, and sometimes checking accounts will earn you a certain amount of interest. Your bank statement will show you a summary of the interest earned during that statement period as well as year-to-date.The account activity — This is a detailed list of every transaction that happens in your account listed in order by date, including deposits, credits, payments, ATM and debit card withdrawals, and fees. Depending on your bank this activity will either be listed all together or could be separated by activity type.
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Why Are Bank Statements Important?
Bank statements are your ticket to knowing what’s happening with your money. It helps you see whether you might be overspending, helps identify areas of improvement or different ways to save (such as subscriptions or membership fees you rarely use), and keeps you in tune with your financial health. Plus, understanding your bank statements allows you to create and maintain a manageable budget, which is also critical for staying on track financially.
On top of just knowing how much you make and how much you spend, monitoring your bank statements on a regular basis can help you catch any errors or potential fraud situations. If anything looks incorrect or unfamiliar on your bank statements, you need to contact your bank immediately. This is why it is especially important to review your statements at least once a month so you can catch anything suspicious before it’s too late.
You should also be reviewing and keeping your bank statements handy for a full year so that you have them at your disposal when filing income taxes, proving your income for a loan or to rent an apartment, etc.
Chat With The Professionals
If you’re having trouble understanding your bank statements, you’re not alone. You can always speak to a local accountant or banker to help walk you through the essentials and what to keep an eye out for. To chat with one of our expert team members at Republic Bank, give us a call at 800-526-9127 or browse our other posts for more helpful information!