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It’s always a good idea to have a few different tools that you can use to pay down your daily, monthly, and yearly expenses. Although it’s more common these days for consumers to use cash, debit, and credit to cover these costs, there are still many situations where a personal cheque can come in handy.
For everything you need to know about how to write and use a cheque, keep reading.
For those who have never used one, a cheque is a piece of paper that you can order through your bank or credit union. Typically, you’ll receive a booklet of identical cheques that have been printed with your personal information. While some chequebooks cost a small fee each time you order, they may also be a free perk if you have a certain type of premium bank account.
When you have your cheques in-hand, you can use them to pay for various costs. Once the person or organization you’re paying deposits the cheque, the money will be automatically withdrawn from your chequing account or savings account.
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Despite the fact that many businesses don’t accept personal cheques anymore, there are still some scenarios where they can be used, like when you:
Remember, while your cheque book can be useful in many situations, there are still other ways of paying for your expenses that can be faster or more convenient.
Now that you know when you should use or avoid using a cheque, let’s talk about the features you’ll see on one. While there are a few kinds of cheque that you can write or accept in Canada, a standard personal cheque will normally contain the following features:
The last feature that you’ll see on a standard cheque is four sets of numbers. These numerals are unique to each cheque and allow the recipient’s bank to locate your account so they can withdraw the desired funds electronically.
What is a routing number? Learn more here.
When you order your chequebook, your bank should also include a register so that you’ll have an easier time keeping track of:
Overall, filling out your cheque register is optional and many consumers will simply use theirs to confirm that all the numbers in their bank account line up, which is commonly known as “balancing” their chequing account.
However, listing all your transactions can definitely help you monitor where your money is going, as well as lessen the risk of theft, fraud, or accidentally spending more than you have in your bank account. If you wish, you can also use your register to keep track of any cheques that someone else gives you.
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Unfortunately, if you print your recipient’s name wrong, enter the wrong payment amount, or forget to sign the bottom, then your cheque may be considered invalid, or worse, you could end up sending money somewhere you don’t want to.
Don’t worry, because there are a few things you can do to bypass these problems and avoid any thieves taking advantage of a lost or stolen cheque:
Before you attempt to correct what you might think is a simple error, consider that some mistakes may be considered worse than others. In fact, some banks will reject the cheque altogether if the payment amount is wrong or some information is illegible. If that happens, it’s probably safer to just void the cheque and start fresh.
Note: Some employers, landlords, and other entities may ask for a blank cheque so they can verify your financial details. In that case, the VOID technique is also essential.
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Still afraid of falling victim to a scam, theft, or identity fraud when issuing cheques? If so, there are several preventative measures you can take, including but not limited to:
If you’re still worried about writing or accepting personal cheques, it may be a better idea to avoid using them altogether. After all, there are plenty of easier and more convenient payment methods available in Canada, such as:
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