Though more forms of cashless payments are becoming mainstream, checks never really seem to go away. Even today, having a checkbook can be very useful to have in major and minor purchases. So, it’s no surprise that many older adults continue to use their checkbooks and younger adults are considering having one.
But for those who have never written a check or held a physical check, you might be confused about the different parts of a check and how to write one. No worries: here’s our complete guide for the everyday user on checks and how to write a check.
What Is a Check?
A check is like a verified note written by a payor instructing their bank to pay a certain amount of money to the bearer of the check, the payee, to be taken out of the payor’s own account. For security purposes, this can’t just be any note: it has to be written, dated, and signed by the payor on the bank’s official check.
Think of it as an authorization letter. It’s impractical and unsafe for a person to have all their money in their wallet, so instead of having cash-on-hand, they place their money in the bank and carry a checkbook around with them. When they want to pay a person or organization, they take out a check out of their checkbook and write down how much they’re giving the person or organization. The receiver will then either take it to the giver’s bank to receive the money, or they deposit it in their own bank and the banks will be in charge of negotiating for the money owed.
Sure, there are other faster and cashless ways to transfer money between parties, but checks are unique because they offer a special layer of protection. If a signed check gets lost or stolen, the person who finds it will not be able to cash it in as the check is not signed to them.
Checks are often used to make recurring bill payments, rental payments, or safe money transfers between two parties especially when large sums are involved. Post-dated checks are often a requirement for long-term rentals: these are checks that are already filled out but dated on a later date so the payee can only cash them in at a later date.
History of Checks
Earlier forms of checks were believed to have been used back in the ancient Roman civilization, but these were different systems at the time. It wasn’t until 1717 did the Bank of England issue reprinted checks that we know today; these didn’t arrive in the United States until the 1790s.
By the 1950s, check usage became popular after automated machines could clear checks quicker. By the 1960s, however, the concept of checks paved the way for debit cards, which then led to credit cards and other forms of cashless payment we know today. The usage of checks has since declined, but its useful features still make it a popular choice for older adults and for certain types of transactions.
Parts of a Check
Although banks have their own check designs, they have similar features that are key to identifying and verifying a genuine check.
- Payor or Drawer’s Name: On the top left-hand side, the name, account information, and contact information of the payor or check giver is identified. If the checking account is a joint account, there may be more than one name.
- Name of the Bank: This shows the name of the bank where the payor’s account is.
- Date line: Where the payor indicates the date the check was written. For post-dated checks, the payee cannot cash in the check until after the date indicated on the date line. Checks have a validity of up to 180 days after the date indicated.
- Payee’s name: The payor will write down the name of the person or organization authorized to take out funds from their account. This is indicated by the phrase “Pay to the Order of” or any similar language. If you write “Cash” on the line, your bank will be allowed to give money to whoever bears the check, but this poses a security risk in case of a lost check.
- Amount box: This is where you put the amount of money to be taken out of your account.
- Amount line: This is the same amount, but written out in words. This is to ensure there is no error when writing the amount in numbers.
- Payor’s signature: The payor must sign the check on the bottom-right line. Banks will not honor a check if it is not signed or has an unrecognized signature.
- Memo line: This can be used to write the reason for writing the check (if necessary), a reference number, or any other pertinent information required by the bank or the payee.
- Routing number: These are the numbers found at the bottom of the check. This is the routing number of the bank, the payor’s account number, and the check number. This is to help process the check and verify its authenticity.
How to Fill Out a Check
If you haven’t signed a check before, here’s an easy guide to filling out a check. Be sure to use a permanent pen (no pencils or erasable pens). Also, some banks have become stricter with checks and do not honor checks with erasures, so if you make a mistake writing a check, simply tear up the check before disposing of it properly and write a new one.
- Date the check. On the upper-right hand corner, write the date on the line provided. Be sure to write the correct date, as checks have a 180-day expiration date from the date indicated. For post-dated checks, make sure you are writing the correct future date to avoid inconvenience on you and your payee.
- Write the payee’s name. On the line “Pay to the order of,” write the name of the payee. Whether it is a person or an organization, make sure you are writing the correct spelling of their name, as some banks may not honor incorrect spellings. If you’re not sure about the person or organization’s name, you can just write “Cash,” but take note that this poses a security risk since this means anyone can cash in that check if it gets lost or stolen.
- Write the amount in numbers. Beside the name, there should be a box. Write down the amount owed to the payee in numbers. Make sure your numbers are clear to avoid any delays.
- Write the amount in words. Below the payee’s name, write the amount in words. This should match the numerical amount written in the box. If you are paying with cents, write “<cents amount>/100. So, if your payment is $100.50, you should write “One hundred and 50/100 only”.
- Sign the check. On the lower right-hand corner, sign your name and signature. Make sure you’re using the signature matching the signature copies your bank has.
- Optional: write a memo. On the memo line, write what the check is for. Usually, utility companies will ask you to write your account number on the memo area if you’re paying your bills with a check.
- Optional: track your check. Once you’ve followed all these steps, you can now hand your check to the person or organization you’re paying. But for your security, use the check register found inside your checkbook to keep track of the checks you give. List down the check number, who your payee is, and how much you indicated on the check.
Tips to Protect Your Account
Like other modes of payment, checks may be abused to take money out of your account. These are just some of the steps you can take to protect your checking account and your money.
- Do not pre-sign blank checks in your checkbook. If your checkbook gets stolen, it will be easy for a criminal to make out your checks to cash and indicate amounts they think you might have in your account, since you’ve already put your signature on the check.
- Keep your checkbook in a secure location. At home, keep your checkbook in a secure location like a vault or a safe place where you can put personal documents. This is to prevent burglars or people from finding your checkbook and trying to forge a check for themselves.
- Void your checks. If someone (e.g. your employer looking to deposit your salary in your checking account) asks for a voided check to get your banking account and routing number, make sure to properly void a check before giving it. Using a permanent marker, simply write “VOID” over the lines of the check. This is to prevent anyone from using this blank check while still safely giving that person your bank account number.
- Dispose of checks properly. If you’ve made an error writing a check, make sure you dispose of your check properly. Either use a paper shredder or tear and cut up the check until none of the information on the check is recognizable.
We’re more and more getting used to doing our transactions online, therefore, it’s possible for some people not to be familiar with the parts of a check and how to fill it out. Bookmark this guide to help secure your check and your money in the bank.