Program Managers

How is your financial fitness?

You can find out by taking the quizzes below
Financial Fitness Quiz
or
Financial Fitness Checkup

Topics

Additional Course Information

Checkbook Management

The key to your financial success could very well be your check register. Younger personnel in the Navy may have never used checks before and have never written one. One of the biggest mistakes made by people using checks is that they don’t reconcile the account every time they get a statement. The only way you know what has been paid out of your account, what checks are outstanding, and how much money you have left in your account is to balance your checkbook. This balancing is called reconciliation. You should receive a statement every month so you can do this. One mistake made in balancing your checking account is that you don’t deduct you ATM withdrawals when doing reconciliation.

There are two basic types of checking accounts and you will have to decide what type of account you want. Some checking accounts will pay you interest on your balance. Some will charge you a fee for writing each check. Some will waive the fee if you maintain a minimum balance. They might also give you free checks if you maintain a minimum balance. Some even offer overdraft protection. This means that if you don’t have enough money in your checking account to cover a check they will transfer the money out of your savings so you won’t bounce a check. Along with this may be a limitation on how many times the institution will do this without creating a problem with your account.

Basic types of checking accounts:

• Individual – only one person has access to the account
• Joint – two or more people have access to the account, but all parties are equally responsible
• A disadvantage of a joint account is that all parties have access
• Another disadvantage is that it is a prescription for overdrafts
• All parties are keeping separate check registers – there is no coordinated record

Common features of a checking account may include:

• Insured accounts through FDIC or NCUA for up to $100,000
• Interest bearing accounts
• ATM/Debit Privileges
• Overdraft Protection – good thing to have for your protection
• Service Fees – you need to know what they are
• Minimum Balance Requirements – some have this requirement for free checks
• Poor Performance Charges – bounced check charges – amount varies from bank to bank

A check is a legal document which is considered a contract or a promise to pay. In order to keep this promise, you will need to manage your checking account.

When opening a checking account you will sign a signature card that the bank will keep. This signature card is for your protection and will be used by the bank to compare your signature with any checks coming through the bank with your signature on it.

Information you will find on a check identifies you and who the payment is going to. You will normally see your name and address, the date, the name of the person the check is being written to, the amount both in numbers and spelled out, the banks name, a line for you to write what the check was for, the signature line, and finally the account number and routing number. The last thing you fill out on a check is your signature. Under no circumstances will you put your Social Security Number on your checks.

Checking steps:

• Making Deposits - A deposit slip describes what is being deposited. When you make a deposit, the bank keeps your deposit slip and provides you with a receipt.
• Writing Checks - Checks are promises to pay.
• Maintaining a Check Register - Your check register is the most up-to-date information about how much money is available in your checking account. Always keep your register with you and record checks written, deposits made, and withdrawals or debits made by your ATM/Debit card as soon as they occur. It's best if you add and subtract your balance as you go along so you don't lose track of how much you have in your account.
• Reviewing Your Monthly Checking Statement - A monthly bank statement includes your balance on the day the statement was issued, average monthly balance, total deposits, interest earned, total deductions (checks, fees, ATM transactions), and a listing of all checks cleared against your account. When you compare the information in the monthly statement with your check register, the balance should agree to the penny. If there is any information in your statement that surprises you, call the bank.
• Balancing Your Checking Account - It's easy to make unnoticed math mistakes in your register that could make it appear as if you have more money than you do. On occasion, banks may make mistakes. By balancing your account each month, you'll catch these kinds of errors early. Balancing is “EASY” because you take the ending balance from the statement, add deposits not on the statement, subtract checks that have not cleared, and your balance is figured minus service charges and fees

• Note that the balance shown on ATM receipts will not reflect checks that haven't cleared. So keep your check register current.

Common mistakes in using checks are listed below:

• Post dating – Post dating or floating a check is against the law. If you don’t have the money in your account you can’t write a check. There can be serious legal consequences for doing this.
• Handwriting – If they can’t read your handwriting how can they understand how much to pay or who to pay the money to?
• Improper signature –When you open the account you sign a card, called a signature card. If the signature on the check doesn’t match the signature on the card the bank will not pay the money to the payee.
• Omitting the written amount – Not only do you have to write the amount in numbers in the box on the check you also have to write the amount out on the line below that. The numbers and written amount have to match.
• Not recording checks – Forgetting to write a check in your check register will throw off your balance at the end of the month.
• Splitting check pads – Married couples sometimes carry separate check pads. When you do this either one of you may miss a check the other one has written. It’s better to keep it simple and use only one check pad at a time.

Writing checks is easy, but bad things can happen if you aren’t careful. It is a felony to write a bad check. It is also against the law to postdate so that it’s good at a later date. If the money isn’t there don’t write the check. Math errors are the most common problem along with shoddy check register habits. You must reconcile your account every month and coordinate with everyone included on a joint account. Make sure you check your account if you are ever deployed for any length of time so you can start fresh when you come home. These few simple steps will make sure that your checking account is a good tool to have, but watch those ATMs and Debit Cards!

Assistance

Counseling

• Army - E-mail
  
  Anthony Powell – Ft. Bliss, TX
  Wk Ph:  915-568-4453,
  DSN:  978-4453
  Email:  anthony.powell1@us.army.mil

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• Navy - E-mail
  
  Mike Kempf – Pensacola, FL
  Wk Ph:  850-452-3228,
  DSN:  922-3228
  Email:  mikekempf@bellsouth.net

More information

• Important changes to credit reports for 2008
• Links to more information
• mysdcc.sdccd.edu

New Links 10-21-2008

• Boston.com
• The News Service
• mymoney.gov

Calculators

• Savings
• Monthly Cash Flow
• 401(k) Value
• Hidden Expense
• Life Insurance
• Loan Amortization
• Net Worth
• Retirement Planning
• Taxed and Non-Taxed Compounding

Glossary

• Common terms in financial planning

General Information

• SDCC has articulated the Navy PFM course for one college credit. Navy personnel who have graduated from the Navy PFM course qualify. Typically, it can be difficult to apply one credit and meet the requirements of a three credit semester long course at most colleges and universities. With that in mind, we have taken the initiative of developing a two credit online course that will be available upon completion of the Navy PFM course. Sailors who have completed the requirements of both the Navy PFM course and the online PFM course will be given credit for completing the three credit Consumer Studies 110 course offered by San Diego City College and Mesa College and transferable to any Servicemembers Opportunity College (SOC).

• For additional information or to see if you qualify contact a PFM counselor.