Knowing how to read your bank statement can save you time and money and help you assess whether you are getting the appropriate service from your bank.
Tony Ketcher of Standard Bank's retail division says a bank statement's main purpose is to enable you to verify your transactions and check that your bank has charged you the agreed fees.
He says one of the first things you should check is charges like your account service fees
to see if they are in line with your understanding of what they should be.
Reconcile the information on your statement with your transactions and make sure that all the cheques you've issued have gone through. The cheque numbers
appear in line with the amounts that have gone through.
Check to see if your statement reflects deposits
made.
Unless you have the option of a monthly management fee or retain the agreed minimum monthly balance, individual transaction fees
should be reflected on your statement. Check that these are correct. You can get information on transaction fees from your bank.
A duty on debit entries
is a tax levied by the Receiver of Revenue for issuing cheques and debits on your account. These should be reflected as per item charges.
Check if all your debit orders like your telephone account, clothing retail accounts and insurance premiums were implemented.
If you have an overdraft, check your statement to see if your interest rate quoted is accurate and tallies with the rate you negotiated with the bank. If your overdraft account is now in credit, the bank should only charge you for the time that you were overdrawn.
Read any additional information on your statement and record notices of increases in fees or changes in fee structures; check whether or not your fees are inclusive of VAT and whether you agree with your monthend balance.
Ketcher says if you spot a discrepancy on your statement or think the bank has made a mistake, contact your branch immediately. The longer you take to report a matter, the longer the bank will take to resolve it because older transactions involve more research.
Get the best deal
You may be able to negotiate interest rates and charges on your accounts that will be of maximum benefit to you.
Ideally, you should do this homework before you open the account.
While some people don't consider it necessary to investigate the opening of a bank account as thoroughly as they would investigate other financial transactions like buying insurance, the same rules apply.
You need to establish what your needs are; what will it cost you to open an account; whether you can negotiate a better deal with your bank and how convenient it is for you to be with that bank and to hold a particular account?
Bank charges vary more so on certain accounts than on others. You should check your statements and ensure that you are aware of all costs and charges deducted.
Remember that transactions are the most expensive forms of banking and the more transactions you have, the more it will cost you to run your account.
If you have the choice, decide whether you will save by paying a monthly transaction fee or whether you should pay for each transaction.