How to manage your checking account

Estimated read time: 4 minutes

In a lot of ways your finances start at your checking account. Your money will come and go from there, depending on what you want to do. It's probably the simplest part of your finances, and if you haven't looked at ways to manage it in a while it's probably time to look it over.

There's a chance you may be missing out on some money savings features, so being proactive can help you maximize the benefits of your checking account. Here are some tips that will help you manage it and make sure you're getting the most out of it:

Save time by automating

You've probably already set up direct deposit with your employer so on payday your salary is sent directly to your checking account. Taking it one step further by setting up automatic transfers between your checking to savings. That makes it effortless on your part to be saving for your future financial goals or just to build on your savings fund. It also makes saving money an automatic behavior and can curb you from overspending on non-essential expenses like a night out for dinner.

Most checking accounts also allow you to set up a bill pay feature for monthly expenses like utilities, cable, or rent/mortgage. Not only does this save you on time, but you prevent yourself from extra costs like late fees and postage. Some companies will charge you a fee if you use a credit card to pay your bills. A payment from your checking account will avoid these fees.

Keep track of your balance

Long ago we may have had to keep track of our account by logging it in our checkbook. Nowadays you can download an app for your bank. You can also set up different types of alerts to let you know if your balance is below a certain amount, when money is going out for purchases, or if a deposit has been made.

Keeping track of how much money you have at all times will keep you in control so you can plan for upcoming expenses, avoid fees, and keep to your budget. Also, you're going to be able to keep your account protected better when you have closer tabs on your account activity. If there is a transaction that you don't recognize that occurs on your account, you will be able to catch it sooner. Being able to react as quickly as possible to a fraudulent activity can help limit the liability for you as well as stop additional thefts from your account.

Use the mobile app

Your bank's mobile app is by far the best tool for managing your checking account. Make sure you're using it regularly and are familiar with what it allows you to do. Mobile banking apps let you do a whole lot more than just letting you know what your balance is. A lot of them allow you do convenient activities like depositing checks and paying bills. It also makes it much easier to keep track of your account than having to log in to your account on a computer.

Maximize earnings with rewards checking

A checking account is the main place we think of to store our funds on a daily basis. A lot of banks offer additional ways for you to earn interest or rewards. Take a look at what your bank has available such as rewards checking.

Every little bit you can earn will add up over time. Plus, if you habitually keep your balance above a certain amount or make frequent debit card purchases a month, you can make the most of your money without changing the way you use your account now.

Avoid fees

Take a minute to look over what fees your bank can charge you for. Is there a fee if your account goes under a certain balance? What about if you withdraw cash from an ATM outside your bank's network?

You need to then consider which of the fees could be relevant to you. If you find yourself paying a fee for a certain activity consistently, you should avoid doing so, and if that's not possible, you may need to consider changing accounts to one that better fits your needs.

Consolidate your accounts to simplify your finances

Maybe you started your first checking account when you were twelve, then added a new one in college, and another after graduating. When you are having to manage tracking multiple accounts it can make it difficult for you to monitor your money.

It's also likely that each of these checking accounts have rules, so it makes it more likely for you to get charged a fee. By consolidating your checking accounts you have a central location of where you're bills are coming out of and what your balance is.

Keep your extra money somewhere else

A checking account is the place to keep your money for your everyday needs like food and transportation. But you should keep just what you need in there because you can earn a better interest rate in other places.

Look for a different type of account for your longer term savings needs. Consider what the purpose of your savings needs are to find the best fit. For instance, if you are saving for your child's education, look for accounts that give you a tax advantage such as a 529 Savings Plan.

Manage your account in a way that works for you

If your current system isn't working, ask yourself what isn't working and what you can do differently. You're going to have to put a little bit of effort in this which can mean you are opening/closing accounts or changing some of the ways you are using your accounts. These changes will be worth it in the end because you will have more control than ever on your finances.