 |
| Image: Moneybestpal.com |
Account statements are documents that list the transactions made on your account over a specific time period. It displays all of the transactions that have taken place in your account, including balance, fees, interest, deposits, and withdrawals. Your bank, credit card provider, brokerage house, or any other financial institution where you have an account may send you an account statement.
An account statement is significant for a number of reasons. First, it aids in tracking your earnings and outgoings as well as monitoring your spending patterns. Your account statement can be used to build a budget and a plan for your financial objectives. Second, it assists you in checking the accuracy of your transactions and identifying any fraud or mistakes.
You can compare your account statement with your receipts and records, and report any discrepancies to your financial institution as soon as possible. Third, it helps you prepare your tax returns and other financial documents. You can use your account statement to report your income and deductions and provide proof of your financial activity if needed.
How to read an account statement?
An account statement typically contains the following information:- Account number: This serves as your account's special identifier. When contacting your financial institution or conducting transactions over the phone, the internet, or both, you might need to supply this number.
- Statement period: This is the time frame that the account statement covers, usually a month or a quarter.
- Opening balance: This represents the balance in your account at the start of the statement period.
- Closing balance: This is the amount of money that you have in your account at the end of the statement period.
- Transactions: The information in this section includes the date, description, amount, and type of each transaction that took place in your account during the statement period (debit or credit).
- Fees and charges: These are the costs that your banking institution assessed on your account during the statement period, including monthly service fees, overdraft fees, ATM fees, foreign transaction fees, etc.
- Interest: This is the total amount of interest that your financial institution, depending on whether you have a savings or checking account, paid or charged to your account during the statement period.
- Summary: The total debits and credits in your account for the statement period are summarized in this section.
How to get an account statement?
There are different ways to get an account statement from your financial institution. Some of the common methods are:- Online: The website or mobile application of your banking institution will let you access your account statement online. Online banking may require you to create an account and use your username and password to log in. A PDF version of your account statement is available for viewing, downloading, printing, and emailing.
- Mail: You can ask for a physical copy of your account statement to be mailed to you from your banking institution. Depending on the rules set forth by your banking institution, you might have to pay a fee for this service.
- Branch: You can request a printout of your account statement by going to a branch of your banking institution. Depending on the rules of your banking institution, you could be required to provide proof of identification and pay a fee for this service.
How to manage your account statement?
There are some best practices that you can follow to manage your account statement effectively:- Review your account statement regularly: Depending on how frequently you receive it, you should study your account statement no less than once each month or once every three months. If you find any mistakes or unapproved transactions, you should check for them and notify your financial institution right away. Along with that, you ought to assess your budget against your account statement and make necessary adjustments.
- Save or shred your account statement: After reading your account statement, you should either preserve it or destroy it. If you do decide to save it, be sure to keep it secure and out of the reach of others. Use a cross-cut shredder that thoroughly destroys it if you decide to shred it. Your account statement can contain sensitive information that could be exploited for fraud or identity theft, so you shouldn't throw it away in the garbage or recycling.
- Opt for electronic statements: You might think about choosing electronic statements from your banking institution rather than paper ones. Paper statements are less handy, unsafe, and environmentally friendly than electronic statements. Also, accessing and storing them digitally is simpler. By getting in touch with your financial institution or updating your preferences online, you can choose to receive electronic statements.
