Money Management: Bank Account Statements

Although most people are familiar with their bank account statements, many of the people who come to us do not fully understand the monthly statements they receive from their banks.

Since reading bank statements is a Must for good money and debt management – we have put together the following guide. The simplified statement below is a combination of several popular Canadian bank statement styles.

If, after reading this guide, you are still unable to fully understand your bank statement, we strongly recommend that you make an appointment with your bank. Take your bank statement with you and have them show you exactly how their statements work.

It is your money – you have a right (and a responsibility) to understand how it is being handled.

The Balance on the right side of the statement is a running total of how much money is in your account. With each activity, the Balance is adjusted. If money goes into the account, it increases and if money goes out of the account, the Balance is decreased.

1. Opening Balance - how much money was in your account at the end of last month. Check this amount against the previous month's Closing Balance.


2. Direct Deposit from your employer - always check this amount with your paystub.


3. ATM Cash Withdrawal – when you take cash out at a bank machine that does not belong to your bank - there is an extra charge (as shown in Fees – Interac charge).


4. Using you debit card to buy something, in this case at The Bay.


5. Depositing a cheque someone gave you – using one of your bank’s instant teller machines.


6. Taking cash out at one of your bank’s instant teller machines.


7. Money for a cheque you wrote (#0045-230399) is taken out of your account.


8. Automatic withdrawals are payments you have pre-authorized. Always check pre-authorized amounts against the utility/phone statements you receive.


9. Monthly Bank Services Fees/Plan are what you have agreed to pay your bank for handling your checking account.


10. Closing Balance - how much money was in your account at the end of the month - this amount will be the Opening Balance on the following month's account.

Every month when you get your bank statement, you need to take the time to make sure it is right – it is your money and it deserves your attention.

Note: Funds on Hold

A situation that we have seen (and experienced ourselves) is when you deposit a cheque into your account – but the amount of the cheque is not ‘available’ for several days. Sometimes called ‘Funds on Hold’, it means that your bank will not actually let you take the money out of your bank account until the cheque has been cleared by the bank it was written on.

Depending on your credit status, and your relationship with your bank, the amount above which they will put deposited cheques on hold – can vary. Avoid surprises, contact you bank and find out at which point cheques you deposit, are put on hold.

Remember: It is Your Money - don’t be afraid to ask your bank questions!