![]() ![]() For those of you without high limit cards, just keep focusing on building your credit for a few years and you will get there. There is no way I would ever, ever, ever go over that limit. They each have a credit limit over $10,000. My primary card is a Starwood Amex and my backup is a British Airways Visa. I put 100% of all money I spend on my credit card. You shouldn’t be spending money out of your checking account anyway. Maybe you are not as money minded as your typical finance blogger. Let’s say you are not good at remembering your account balances. However, if you track your transactions online and know your balances, you don’t need to waste the headache on balancing a checkbook. Balancing a checkbook the old fashioned way takes a lot of time and effort. Second, I look at every transaction from the last few days to make sure I recognize everything. While sites like PageOnce offer you a quick snapshot of account balances, Mint and Personal Capital give you a far more in depth and useful view.Įvery day when I log into one of those sites (I use both Mint and Adaptu, but I am a finance nerd), I do two things. If that site doesn’t float your boat, also check out my comparison reviews of vs PageOnce or one of my new favorites, Personal Capital. With one login I see all of my account balances in one, easy to use view. Of course, regular readers know I am talking about. You can log into one site to get everything in front of you in one executive management style view. That is not because I log into my bank’s website. I know what my account balances are within about $10 at any given time. That is true, but there are better ways to do all of that. We are told that by tracking our transactions, we are protecting ourselves from overdrafts and ensuring nothing unauthorized happens in our accounts. This common advice is given with the best intentions. ![]() If that’s not possible, look into overdraft protection, but only sign up if you’re going to use it as a safety net – don’t make a habit out of paying those fees – and use a less expensive overdraft line of credit if possible.We have been told that we need to balance our checkbooks for decades. A small cash cushion can help you avoid problems. If you’re always “running on fumes,” you’re eventually going to have a problem. You can also keep a buffer of cash in your account to protect you from unexpected expenses and delays. As a bonus, the money might even hit your account a day or two before the checks are printed, and some banks offer same-day availability for those payments. You don’t need to wait on the check (especially if it goes through the mail), and you don’t need to go to the trouble of depositing the check. If your employer still pays you with a check, sign up for electronic payments so that the money goes directly from your employer’s bank account to your bank account. However, there are ways to reduce the chances of your account running dry.ĭirect deposit gets money into your account quickly. Avoiding Cash Crunchesįor the most part, you depend on your bank to release funds. The fees (overdraft or non-sufficient funds) will be deducted from your account, further reducing the balance. Instead of paying the $40 check, we could have returned the check and would have charged you a non-sufficient funds fee. Because you have only $30 available (you have committed to pay the restaurant $20), your account will be overdrawn by $10, even though your current balance is $50. Before the restaurant charge is sent to us for processing, a check that you wrote for $40 clears. A hold is placed on your account, so your available balance is only $30. Current balances include all of your money, including all available funds PLUS funds that are being held.įor example, assume your available and current balance are both $50, and you swipe your debit card at a restaurant for $20. In those cases, you can only spend your available balance (or less if you have outstanding checks), and the rest of the money is being held by your financial institution. Sometimes you’ll see an available balance that’s lower than your current balance. To determine whether you have enough money in your account to cover a transaction, we use your account’s available balance which is based upon the deposits and withdrawals to your account and all pending electronic transactions, including pre-authorized transfers, point of sale transactions, and merchant payment authorizations (regardless of whether they have posted to your account). Your available balance is the amount you can spend right now. Knowing the difference might just save you some money in fees. Two of the most commonly confused terms used in the financial sector are “Available Balance” and “Current Balance.” Although these terms seem very similar, they refer to two very different things.
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