How to Calculate a Checkbook Balance

"Hi, this is Doug Benson on behalf of Expert Village. I'm going to show you how to balance your checkbook and as a result become a better manager of household finances. Let's now go through our transaction register beginning looking for the transactions that do not have a check mark next to it. These are the transactions that are still outstanding and yet now have not cleared at the bank. First of all let's look for the deposits and credits. I see that I have one paycheck for $850.00 and one ATM deposit for $40.00. I'm going to add those two deposits to the ending balance from the statement that we wrote down in the previous step. That brings my balance up to $1249.27 but we're not finished yet, now we need to go through our check register to identify outstanding checks, ATM transactions and debit card purchases that were not on the bank statements. In this example I found four transactions that have not yet been posted or cleared the bank and they total $642.15. Next we subtract the total of those outstanding transactions from the temporary balance from our worksheet on the back of the bank statement. That leaves me with a reconcile balance of $607.12. This amount matches the ending balance of my transaction register so my checkbook is now balanced. Watch my next segment as we continue to learn more about balancing your checkbook and becoming a better manager of household finances."