Chapter 4: Endorsing a Check

Checks must be endorsed (signed) before you or someone else can cash them or deposit them into an account. Endorsing a check means making a specific notation on the back of the check so the financial institution will know what to do with it.

Depositing a Check

Some financial institutions require a deposit ticket be included with a deposit. If so, you will need to complete the deposit ticket properly:

• Date of deposit
• Amount of currency, if you are depositing cash
• Amount of coins, if you are depositing coins
• Amount of the check, if depositing a check
• The total from the other side of the deposit ticket, if information was completed on the back of the deposit ticket – this is usually the total of checks deposited if the number exceeds the room available on the front
• The total amount of the deposit
• Less cash received
• Net (total) deposit

Writing a Check

You can avoid many problems – such as having a check returned to you, resulting in late payments – by properly writing the check in the first place. Fill out the check completely:

• The current date
• The payee (person or company receiving the check)
• The amount of the check in numerals
• The amount of the check in words
• Your signature
• A memo to document what the check was for

If you make an error, write "VOID" on a check or fix the error and write your initials next to the change. Be sure to indicate a voided check in your check register.

Making a Stop-Payment Order

There may be a time when making a stop-payment order on a check (commonly called "canceling a check") may be necessary. A stop-payment order makes a check "uncashable" to the payee. To stop payment on a check, you must provide the details of the check and sign off on documentation. The fee to cover the paperwork involved will be automatically deducted from your checking account. Most financial institutions impose a six-month time limit on stop payment orders.

If you choose to stop payment on a check, you must have legitimate grounds – if you write a check and then stop payment without good reason, you may create civil or even criminal liability for yourself. Placing a stop-payment order on a check may be done for a variety of reasons, including:

• Your mailed check never arrived to its desired destination
• You suspect checks have been stolen
• You wrote a check for a service, but have a legitimate complaint against the service
• You wrote a check for a product, but have a legitimate complaint about the product

Choosing and Sharing Accounts

If you share an account, select one person as the account manager. With more than one account user, monitoring transactions can be complex. Think carefully before agreeing to have a joint account or becoming a co-signer on someone else's account – if they mishandle the account, you could be held responsible for the errors.

Consider all of your account options before deciding which is best for you.

• Individual – An account owned by one person. This is a good option for those who want to have total control over the account.

• Joint – An account owned by two or more people, usually sharing a household and expenses. Each co-owner has equal access to the account.

• Senior/student checking – Many financial institutions offer special checking programs for students and senior citizens.