A bank statement provides an overview of all the activity in your bank account over a set period of time, usually one month. It shows your transactions—money coming in (deposits) and money going out (withdrawals)—and provides insights into your financial habits.
Contents
Key Components of a Bank Statement:
- Personal Information: Your full name and home address will appear on the statement.
- Account Information: This includes your account number and the type of account (e.g., checking, savings).
- Statement Period: The timeframe the statement covers (e.g., March 1 to March 31).
- Balances: You’ll find the beginning balance (how much money was in your account at the start of the period) and the end balance (how much you had at the end).
- Summary of Transactions: This section lists all deposits and withdrawals in chronological order, along with dates and amounts.
- Fees: Some accounts charge fees, such as monthly maintenance fees or overdraft fees. If applicable, these will appear on the statement.
- Interest: For savings accounts, any interest earned will be listed.
Why It’s Important to Understand Your Bank Statement:
- Track Spending: By reviewing the statement, you can see where your money goes and identify any areas where you might be overspending.
- Plan a Budget: Knowing your spending habits can help you set savings goals and create a budget.
- Check for Errors: Reviewing your statement helps you spot mistakes or unauthorized transactions, like charges for something you didn’t buy or a subscription you canceled.
- Detect Fraud: If you notice unfamiliar transactions, it’s important to report them to your bank immediately.
How to Get Your Bank Statement:
- Online Banking: Most banks offer electronic statements through their apps or online banking portals. You can download them as PDF files.
- Paper Statements: Though less common today, some banks still mail statements. However, you might need to pay a small fee for this service.
Why Teens Should Read Their Bank Statements:
- Understanding Spending: Teens can see how their spending habits evolve, helping them make more informed decisions.
- Financial Goal Planning: Statements help teens track how much they’ve saved and if they’re on target for any major purchases.
- Avoiding Overdraft Fees: By regularly checking the balance and transactions, teens can avoid spending more than they have and incurring costly fees.
Practical Tips:
- Regularly Check Your Statement: Make it a habit to check your statement every month. This ensures you’re aware of your account’s activity.
- Look for Errors: Always check that the transactions on your statement match your records (like receipts or your app).
- Keep Your Information Secure: Never share your bank statement on social media or with anyone you don’t trust, and use secure devices and networks when checking your bank info.
By getting into the habit of reading bank statements, teens can gain valuable insights into their money habits and avoid potential financial pitfalls in the future. This is an essential life skill that will serve them well as they become more independent and manage their own finances.
