Do I Still Need to Carry a Checkbook?
An increasing number of people are opting to manage their bank accounts online rather than using paper checks.
In recent years, USAA Bank has seen the number of checking accounts rise significantly, but reorders of paper checks have remained flat, says Chris Medlin, digital product manager at USAA.
“These days, you just don’t need paper checks for a great deal of your personal banking,” he says. “People are finding that they can get much better visibility and control using online banking tools, like automated bill pay and budgeting assistance, that can map out what’s owed and coming due.
“It is sort of odd that the industry continues to call these ‘checking accounts’ when paper checks are a decreasing part of their appeal.”
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The Advantages of Online Banking
Many people who begin using online tools never go back to relying on paper checks for the bulk of their banking activity.
The two biggest advantages of online banking, according to Medlin, are:
- Speed: Getting payments out a lot faster.
- Tracking: The ability to keep track of activity in real time instead of having to mark it down by hand in a ledger.
Other benefits of online banking include:
Control over payment timing. When you hand over a personal check, you’re handing over the decision of when to process that payment to the recipient, who may deposit it long after you were expecting those funds to be withdrawn from your account. By using a payment card or setting up online bill pay, you control when a payment is debited against your account.
The postdated check is not the safety valve people think it is. Banks don’t consider the date written at the top of a check when processing it, Medlin says. The myth endures and some still think postdating a check at the grocery store – in situations where funds aren’t immediately in the account – will prevent it from bouncing. You can ask an individual recipient not to deposit a check until an appointed date, but the actual date on the check is meaningless.
Transferring funds between accounts. If you have more than one account, say a checking account and a savings account, you can typically move money between them via online banking. That’s much more efficient than going to a physical bank branch every time you want to transfer funds between accounts. In fact, funds from the first account are typically made available immediately in the second account if both are with the same bank.
More options for payment. Online purchases require some type of electronic payment method. An increasing number of brick-and-mortar retailers and other businesses don’t accept paper checks. Some may accept electronic checks and online bill pay transfers. And almost all businesses accept debit and credit cards, with the exception of some cash-only places, like food trucks and bars.
Sometimes You Really Do Need a Check
Even for those who rarely use paper checks, there are some circumstances where they’re useful, such as:
- Sending a monetary gift for a birthday or holiday
- Purchasing a big-ticket item, like a car
- Paying for school fees and school supplies
- Paying taxes
- Running a small business with a personal checking account
- Paying a contractor for a home repair or improvement project
“There are certainly people who are used to keeping a checkbook and might be resistant to changing that. That’s fine, but online payments really are much more manageable, fast and efficient,” Medlin says.
Looking for more financial options suited to your lifestyle and needs? Find out more about USAA Bank’s checking accounts, credit cards, auto loans and home mortgages.
Chris Medlin is digital product storefront manager for the DXD Bank Services team at USAA. He recently completed the Certified Experience Analyst certification and is working toward the Certified Usability Analyst designation. He is also a GE-Certified Six Sigma Master Black Belt in process improvement, and supported quality and process improvement programs for other companies prior to joining USAA, including GE, Chase and Compaq. Chris is a proud Aggie and studied at both Texas A&M and the Universidad de las Americas in Puebla, Mexico.
1 USAA Bank does not charge a fee for the first 10 ATM withdrawals. Subsequent withdrawals will be charged $2 each except when made at any USAA Bank-owned ATM. USAA Bank also refunds up to $15 in other banks’ ATM usage fees for transactions at ATMs in the United States. The ATM fee refund does not apply for the month in which the account is closed. The ATM fee refund does not apply to USAA Cashback Rewards Checking. A 1% foreign transaction fee applies to withdrawals outside the United States.
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Note 4 Pay-a-Day early is subject to when USAA FSB receives pay information from DFAS.
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