If you have a bank account in Canada, one of the most important things you should do is learn to read your bank statements properly. Keep reading to find out what a bank statement is and why it’s such an essential document.
What Is A Bank Statement?
A bank statement is a basic summary of the financial transactions you’ve made using your bank account during a specific period, like deposits and withdrawals. Typically, bank statements are delivered to clients on a monthly basis. It’s smart to read yours carefully so you can check it for errors, track your spending, and watch for fraud or theft.
What Information Is Included On A Bank Statement?
It’s also important to monitor your bank statements because they contain critical information, including but not limited to:
This will depend on your bank, but you can also expect that your full name and primary address will always appear on your bank statements. These details will be on your statements even if you access them online.
Bank Account Details
Nearby, you’ll also see part of your account number (some of the numbers will be obscured for security purposes), as well as the name, address and customer service number of your financial institution.
This includes any transactions that involve you extracting money from your account or sending it elsewhere, such as:
- Electronic transfers
- ATM withdrawals
- Loan payments
- Everyday purchases and payments (debit card transactions, etc.)
- Fees charged by your bank (account fees, overdraft fees, etc.)
This qualifies as any transaction that involves putting or receiving money in your bank account, such as:
- Reimbursement or credits
- Direct deposits (paychecks, etc.)
- Electronic transfers
- Cancelled cheques or payments
You’ll also see a brief description of most banking actions you take. For instance, if you recently bought something with your debit card, you’ll see the store name and purchase amount on your bank statement.
Additionally, the date of each transaction will be listed next to it. Keep in mind that it can take time for some transactions to show up (you’ll often see “transaction pending” when looking at your online statement).
Interest Or Dividends You’ve Earned
If any of your bank accounts generate some sort of profit, as you might see when putting money in an RRSP, TFSA or another investment account, notice may appear on your monthly statement too.
Account Balance And Transaction Summary
Lastly, your statement will show your final account balance at the time it was issued, along with a summary of the deposits or withdrawals made during that specific period (usually a full month).
How Do I Access My Bank Statements?
Remember, reviewing your monthly bank statements is an essential part of making sure your accounts are safe from fraud, errors, or losses. While the process depends on your financial institution, there are two ways most Canadians get their bank statements.
Accessing Your Bank Account Statement Online
These days, the majority of people access their bank statements via their bank or credit union’s online banking portal. Even if you’ve never used online banking, making an account and finding your statements is usually pretty easy:
- Go to your bank’s home website or download their mobile app and locate the option to create your account. You can call customer service for this too.
- Follow the instructions to make your account. This could involve steps such as entering your debit card number, as well as creating a username and password.
- Once your online account is active, log in and search for your bank statements, which are often under tabs like “services”, “e-statements” or “bank statements”.
- Click the appropriate tab and choose the statement period you want. You can then download it as a PDF or just review it on your computer/mobile device.
- You can also print your bank statement or store a digital copy of it on your device or computer for safekeeping. Then, all you have to do is log out of your account.
Receiving Your Bank Account Statment By Mail
Although it’s becoming less common if you create your bank account over the phone or by visiting a branch of your financial institution, there’s a chance that you’ll automatically be signed up for a paper statement mailing service. From that point on, any monthly bank statements you receive should be the same as the ones you would see online.
All that said, most major banks and credit unions are slowly going green nowadays, which means they may offer, even prompt you to take the option of paperless statements.
While this can result in a fee for printing, mailing and postage, you can get your paper bank statement by following these steps:
- Log into your online bank account via your computer or mobile app
- Request mailed statements (normally under “account settings” or “services”)
- Wait a few days, check your mailbox, then put your statement somewhere safe
How Long Do Financial Institutions Keep Your Bank Statements?
Banks and credit unions will typically store your bank statements for at least 5 or more years, even after you’ve closed your account. For example, here’s how long some of the most popular financial institutions in Canada keep your bank statements on file:
|How Long You Can Access Your Bank Statements
|Up to 7 years of past statements online
|Up to 7 years of archived eStatements online
|Up to 7 years of account statements online
|Up to 7 years of credit and bank account statements online
|Up to 7 years of account statements online
View, print or download up to 24 months of banking history
What Is A Bank Statement Used For?
Financial institutions will generally store your bank statements for such long periods of time for liability purposes and personal use by clients. As mentioned, there are plenty of essential things that you can do with your bank statements too, including:
- Monitor Your Spending Habits – If you’re not sure where your money is going every month, you could end up in trouble. So, use your bank statements to track your expenses and confirm that you’re saving more cash than you’re spending.
- Watch For Unauthorized Transactions – A scammer can steal your identity, drain your account before you know it. Keep an eye out for any transactions that you can’t remember, no matter how small they are.
- Store Them For Tax Season – To file your income taxes, you might need your bank statements from previous years. Plus, the CRA will sometimes request those kinds of documents if they audit you.
- Apply For A Credit Product – When you apply for loans, lines of credit, and other financial products, lenders will often ask for your most recent bank statements so they can see your other debts and judge your ability to make payments on time.
- Rent A Dwelling – Similarly, potential landlords and rental agencies may want to check your income and place of employment prior to taking you on as a new tenant. Be wary that they might also look at your credit report during this time.
- Refinance A Mortgage – Your recent bank statements can be especially crucial when you apply for a home financing product, like a new loan to refinance your existing mortgage.