Spring Cleaning Week: Toss Your Check Book!

ADVERTISEMENT

We all know someone who still uses their checkbook ledger and catches a lot of flack for meticulously noting every line item. Why, in the age of online banking, would anyone resort to such a mundane task? While noting every purchase might air on the overly cautious end of the spectrum, simply logging into your bank account online doesn’t count as responsible financial management. Now there are several software programs available to synchronize all of your accounts, enabling you to toss the ledger and making it easy to stay on top of your spending. 

Programs like Quicken (INTU) , Mint and Wesabe no longer require you to manually input every dollar spent. Register your online accounts and it will do a secure online sweep and regularly synchronize your credit card and ATM balances, deposits and charges onto one master ledger. “In three mouse clicks it goes to banks, American Express (AXP), and Visa and dumps it into the register,” says Liz Weston, author of Easy Money: How to Simplify Your Finances and Get What You Want Out of Life. These programs will even categorize your spending, to help you set budgets on expenditures such as gifts, travel, and food. 

Mint, Wesabe and Quicken Online are all available for free download and you can access them via your cell phone, leaving little excuse the next time you bounce a check. Instead, you can check how you stack up against your peers, budget-wise. Mint users can see if they spend as much per week as the national average on Starbucks (SBUX)  or whether they spend more or less than their hometown average on their mobile cell phone plan, says Aaron Patzer, Mint's founder and CEO. “It’s helpful information when settling budgets, and it’s just kind of fun to know where you stand,” he says. 

If your account typically hovers near the minimum balance, online software will help you avoid bounced checks, but beware of the potential fees for such a service. Banks often charge up to $35 for each time you access overdraft. “Some banks offer bounce protection instead of overdraft. That means it will approve a purchase or let a check clear, but then charge you for going over,” says Weston. That's true. In 2007, banks earned $19 billion in such fees -- up 85% from 2004. 

And even if you streamline your spending through software, it does not absolve you from checking your accounts for errors. “I’d particularly caution people to look for small things that are funky,” says Weston. “Banks love $3 fees for stupid things and I fight all of those charges.” In other words, you still have the responsibility of looking at the transactions and making sure they all make sense. Online software just makes paying attention a whole lot easier than reading the scribbles in a checkbook. 

 

Show Comments

Back to Top