Bank statements are detailed reports of transactions that happened in your bank account during a certain period. So, suppose you deposited cash in your bank account on a particular date and on a future date you want to confirm it, you can simply get the bank’s account statement for that period and verify the transaction yourself.
Now, the question is, how often should you check the bank statement? The answer is, at least once every month or more frequently when you have a big corpus lying in the bank account. There are many reasons for checking your bank statement every month. Let’s check out some crucial ones.
For verifying the recent transactions to avoid confusion in the future
Often people spend money in a hurry and after a few weeks or months often forget and find it difficult in establishing where the money was spent. A habit of checking the bank statement regularly can help you verify each transaction. When verifying the transaction of the recently passed month, you can also write down a note beside specific transactions which you feel are important for the future date. For example, suppose you had spent a big amount on buying gold jewellery, you can write a small note on such transaction because it can help you to respond in the future if you receive a query from the IT dept.
Also Read: Should you convert your credit card due amount into EMIs?
To keep a check on the charges levied by the banks
Banks may levy charges on various transactions of which you may not be aware of. For example, some banks levy charges on getting a physical account statement, issuing a duplicate passbook, annual debit card fee, exceeding the transaction threshold in your debit card, non-maintenance of the minimum balance in the account, etc. You can’t trace such charges until you read your bank account statement carefully. Sometimes, the bank levies a charge which you are not liable to pay and if you complain immediately, you can make the bank revert such charges.
To avoid fraudulent transactions
Several financial fraud cases happen in the country. A bank account statement is the most important document that can be used as a proof of such fraud. By checking your account statement, you can easily trace fraudulent transactions. You must report such fraudulent transactions to your bank as soon as you know about it.
Adhil Shetty, CEO, BankBazaar.com, says, “Checking your bank statement regularly helps you keep track of your account transactions. This practice can be beneficial in case of suspicious or unauthorised transactions, which, when spotted, can be flagged immediately. You will also be able to track your spending, which may help you manage your budget better. Most importantly, this will help you ensure there are always sufficient funds available for timely bill payments.’’
Also Read: Old vs New Tax Regime: Which regime is better if your salary income exceeds Rs 7.5 lakh & 15.5 lakh?
Checking the bank statement can help you keep watch on your expenses
If you are unable to save money despite having a good income, your bank account statement can help you find the reason. You just need to mark all the debit transactions on your bank account statement and segregate the unnecessary expenses. It will help you to stop unnecessary expenses and improve your spending habit. For example, frequent expenses related to restaurant bills, online shopping, etc. can be easily marked on your bank statement and you can take measures to reduce such expenses. Checking your bank statement every month can help you quickly identify the change in your spending habit and bring it down in sync with your budget.
You can proactively invest the idle fund
You may be having multiple bank accounts and enjoying several benefits along with them, but do you know how much funds you maintain in each account every month? Checking the bank account every month can help you know the fund balance lying in each account. You can use the idle fund to invest in an appropriate investment instrument and earn a higher return compared to your savings account. In the long run, by identifying and investing your idle fund, you can make a huge corpus that can help you in bigger wealth creation.
Apart from reading your bank account statement every month, you should also carefully notice SMS and mails sent by your bank. If you find any of the bank messages to be doubtful, you should immediately check your account statement and, if required, contact your bank support team for help.