collage of money, charts, student working and graduating

A Lesson in Check Writing

by Dalisha D. Herring, CFP®

One downside of advances in financial technology is that the knowledge and use of everyday check-writing is lost on today’s students. Several students in the last few months have come to me and asked how to write a check. Many of today’s students, I have found, don’t even have checks on their accounts because of the convenience of debit cards and ATMs.

For many, this little lesson in check-writing may seem juvenile and too simple, but in a time when so few checks are written, you might be surprised at how many of your teenage and college-aged friends don’t know what to write where on the face of a check.

example check

The diagram above shows in red what you write in each blank of the check. It is often important to notate what your check is for in the “FOR” line. This might also be called the “MEMO” line on some checks. For instance, you might write “January utilities” if you are writing a check to your roommate for your part of the utility bill. Or if you are making a payment on an account with your doctor’s office you might include your account number for the doctor’s office here. Including a good description in the “For” or “Memo” line will help you down the road if you ever need to go back and prove to a vendor that you paid a bill they are telling you that you didn’t.

So, why is knowing how to write a check so important when debit cards and online banking are so easy to use? Not all vendors accept debit or credit cards and if they do, they may charge you a fee, often up to 3%, to pay by card. So, if you know how to write a check, you can save yourself a few bucks. And those bucks can add up over time!

However, beware of float time when writing a check. This is the time it takes the check to clear your account. Unlike a debit card transaction that immediately takes funds from your checking account, a check can often take a few days to clear your account. If you don’t keep good track of your transactions in your check register (or in an Excel spreadsheet like I do), then you could very easily forget a check you wrote a week ago and potentially overdraw your account. As a friend of mine in college learned 20 years ago, a $5 check for a fast food sandwich could end up being a $30 burger with the added bank fees for insufficient funds.

Dalisha D. Herring, CFP®
Ph.D. Student
Department of Personal Financial Planning
University of Missouri