Financial Literacy: Balancing a Checkbook

Checking Account Simulation Pretend you opened a checking account on October 1st and put $100 in your account. On October 4th, you deposited $50 more. You wrote a check to your brother/sister for his/her birthday for $125 on October 5th. He/she put the check in his/her desk and forgot about it. You use your ATM card at Wal-Mart to buy a DVD on October 7th. The amount was $25. On October 20th you check your account balance at the ATM. It shows you have $125 in your account.

Checking Account Simulation Balance: $125.00

Checking Account Simulation On October 22nd you use your ATM card to buy the following things: Starbucks Coffee $5.00 Shoes at Kohls $25.00 Lunch at The Olive Garden $15.00 Movie Tickets at Cinema Star $20.00 Video Game at Best Buy $50.00 Total Spent on October 22nd: $115.00

Checking Account Simulation On October 21st, your brother/sister finds the check you wrote and cashes it. What happens next? Starbucks Coffee $5.00 Shoes at Khols $25.00 Lunch at The Olive Garden $15.00 Movie Tickets at Cinema Star $20.00 Video Game at Best Buy $50.00 Total Spent on October 22nd: $115.00 $35.OO Overdraft Fee $175.00 in Fees! $175.00 in fees + $115.00 in purchases $290.00 you owe the bank!

Checking Account Simulation What is the lesson? Don’t just depend on what the ATM says you have in your account. You have to keep track of the money you deposit and withdraw from your checking account.

Check Register 10/1 Deposit 100 00 100 00 10/4 Deposit 50 00 150 00 1234 10/5 John Doe – Birthday Gift 125 00 25 00 10/7 Walmart - ATM 25 00 0 10/21 Starbucks - ATM 5 00 -5 00 10/21 Kohls - ATM 25 00 -30 00 10/21 Olive Garden - ATM 15 00 -45 00 10/21 Cinema Star - ATM 20 00 -65 00 10/21 Best Buy - ATM 50 00 -115 00 10/21 Overdraft Fee 35 00 -150 00 10/21 Overdraft Fee 35 00 -180 00

Parts of a Check

Writing Checks Jane Doe October 5, 2017 John Doe 125.00 One hundred twenty-five & 00/100 ------------- Jane Doe Birthday Gift 1234

Writing Checks The Wrong Way October 5, 2017 John Doe 9 25.00 Nine hundred twenty-five & 00/100 ---------- Jane Doe Birthday Gift 1234

Do not sign/write/ stamp below this line Endorsing a Check ENDORSE HERE: X _____________________________ ______________________________ Do not sign/write/ stamp below this line John Doe 8769871

Checks

Check Register

Bank Statement

Practice Entering Transactions Beginning Balance $250.65 Check #1234 to Southern California Edison (SCE) for $80.33 on 9/1/10 Payroll (Direct Deposit) of $295.00 on 9/2/10 ATM Withdrawal of $100 on 9/4/10 Check #1235 to Macy’s for $29.94 on 9/6/10 Walmart debit card purchase of $15.22 on 9/9/10 Check #1236 to Farmer’s Insurance for $22.05 on 9/11/10 Void Check #1236 to Farmer’s Insurance (add $22.05 back in) Check #1237 to Farmer’s Insurance for $22.50 on 9/11/10 Payroll (Direct Deposit) of $254.33 on 9/14/10 Check #1238 to Nuevo Water Company for $52.87 on 9/19/10 Check #1239 to The Gas Company for $32.44 on 9/20/10 Birthday gift deposit for $100.00 on 9/22/10 Target Debit Card for $36.76 on 9/25/10 Walmart Debit Card for $15.33 on 9/29/10 Ending balance should be $514.59

Check Register 250 65 1234 9/1 Southern California Edison 80 33 170 32 250 65 1234 9/1 Southern California Edison 80 33 170 32 9/2 Deposit – Payroll 295 00 465 32 9/4 ATM 100 00 365 32 1235 9/6 Macy’s – Lingerie 29 94 335 38 9/9 Walmart – Debit 15 22 320 16 1236 9/11 Farmer’s Insurance VOID 22 05 298 11 9/11 Farmer’s Insurance 22 05 320 16 1237 9/11 Farmer’s Insurance 22 50 297 66 9/14 Deposit – Payroll 254 33 551 99 1238 9/19 Nuevo Water Company 52 87 499 12 1239 9/20 The Gas Company 32 44 466 68 9/22 Birthday Gift – Deposit 100 00 566 68 9/25 Target – Debit 36 76 529 92 9/29 Walmart – Debit 15 33 514 59

Reconciling Your Bank Account √ √ √ √ √ √ 9/8 Withdrawal – ATM 100 00 414 59