Checks are now one of the many ways in paying for stuff like buying, paying tuition etc, anything that involves spending your money. For me checks are one of the most useful when it comes to paying something with a big value. For me checks are more dependable that credit cards in many ways. The only time I get hold to a check is when I enroll and pay for my tuition. I do not really know much about a check. The only thing I do know about a check is how it looks like and that we have to write the amount on how much we will pay and information like your name and the company or school you are paying it to. I started to know more about checks in our topic in business math class about "Bank Reconciliation"..
Bank Reconciliation is the process of bringing the bank's monthly report for each depositor showing deposits made, checks written, cancelled checks, and service charges. Checkbook contains checks and check stubs. The checks are filled out by the depositors made, and of charges made by the bank. Reconciliation statement making an agreement to the bank statement balance and the checkbook balance.
The differences in the balances may be due to:
- Outstanding checks- checks issued by the depositor but have not yet been presented to the bank for payment.
- Deposit in Transit- deposits made but late to be included in the monthly bank statement. (because of cut off period)
- Service Charges
- Errors in check stub entries
- Cancelled checks- checks that have been payed by the bank.
Checks are useful but it also has its disadvantages so here are the Advantages and Disadvantages of checks:
Advantages
Convenience is the benefit often cited when consumers are
asked why they use check-cashing services. There are both freestanding
check-cashing places and those located inside of other businesses, such as
grocery stores.
These businesses are usually open later than a traditional
bank and most will cash checks instantly as long as the customer has a picture
ID.
There are no monthly fees as there would be with most bank
accounts. Instead, consumers pay a fee only when they have a check to cash. For
someone who doesn't cash checks very often, this could save them money.
Disadvantage
The way that check-cashing places make money is to charge a
fee for every check that they cash. This fee is usually a percentage of the
check. The percentage charged varies from place to place and often depends of
the type of check that is being cashed. For example, the fee may be lower for a
government check than for a personal check.
Fees typically range from 1% to 5% of the face value
of the check. If you use a check-cashing place to cash all of your payroll
checks, that essentially means you will take home 1% to 5% less than you would
if you cashed your checks at a traditional bank
Knowing about checks is very important even though you are still a student. Because in the future we will be the ones to be handling checks ourselves for business and other stuff that we need to handle. If we know more about checks we won't be fooled to easily or commit bad mistakes that could really hurt you when it comes to money issues. Money pretty much dictates the way we live so learning about checks, credit cards and all other stuff that is connected to money and business is very important when you want to live a wealthy life.
