How A Blue Collar Worker Keeps A Positive Bank Balance

Here’s an accomplishment that I’m truly proud of. During the last 6 years, I’ve never had a negative balance in my checking account. Not once. Here’s how my system works:

1. Don’t write checks for any reason. I’ve had the same box of checks for the last 3 years and I think I’ve written 7 checks. I know it’s tempting to try to ‘float’ a check till the next direct deposit, but don’t do it. They’re not credit cards. Paying bills with a check is a bad idea also, because some companies can take up to 3+ weeks to cash your check, and it will always try to post when there’s no money in the bank. Use money orders if you have to send a payment through the mail.

2. Pay all possible bills online or over the phone. Use your Visa or MasterCard debit card. Not only will this method keep you safe (assuming you have a firewall, anti-virus, anti-spyware, etc.), but the payments will usually clear the bank right away, eliminating the chance of overdraft due to insufficient funds. If the money isn’t there, the card will be declined in most cases. If you’re using Visa, you’re also protected from any unauthorized charges over $50 on most purchases.

3. Don’t use your debit card at the gas pump. Go inside and charge a specific dollar amount for fuel, $20, $40, $1000, whatever. Many gas stations won’t take the money out of your bank right away if you use your card at the pump, but they’ll only authorize the card for $1 to make sure the card is valid. A few days later, when you happen to be broke, that $50 charge that you forgot about will come out of your account, leaving you in the hole.

4. Buy a dry-erase board with a calendar and hang it in plain sight. This is how I keep everything balanced, and that damn board is about the most useful item we own. My method is very simple, and it works like a charm.

* Gather up your bills for the month, the amounts and dates you need to pay, and write them down on the calendar in the corresponding date boxes.

* Write your bank balance at the top of the calendar. Since I get paid weekly, when my check is direct deposited I’ll go to my bank’s website, get my current balance and write it on the board. You can do this bi-weekly, or for the ambitious type, monthly works too.

* Add up all your bills, food cost, etc. for the week and subtract them from your bank balance. Here’s an example.

Let’s say you brought home $700 this week. The phone bill ($100) and the electric bill ($100) are both due. You’re also saving $100 per week for rent. Food costs $100 a week too. That’s $400. Subtract $400 from your bank balance of $700 and you’re left with $300.

* My new balance after all the bills for the week are paid is $300. Erase the $700 (your beginning balance) and put up your new “after bills are paid” balance of $300.

* Every time you use money from your account, subtract it from your new balance of $300 as soon as you get home. The bills are already paid, so you know for sure that money is yours. Always round up to the next $2-$3 increment or so (i.e.–I spent $12.83 at the movies–I would subtract $15 from my $300 balance to avoid overspending and having to keep track of small change–my new balance would be $285–write it on the board)

* It’s difficult, but if you’re living paycheck to paycheck, always try to keep $100+ or so extra in your checking account just in case. Once your balance drops below $20, if something happens to clear that you forgot about, you’ll overdraft. Nothing gets me angrier than paying $30 for a candy bar.

You now have $285 to spend this week on Donny Osmond records, or whatever floats your particular boat. Betcha didn’t know it was that easy. And since you don’t write checks any more, you no longer have to wonder what’s going to clear this week. Talk about stress relief!

As working class Americans, we work very hard for our money. It’s ours, not the bank’s. Keep it that way.