Why No One Knows How to Write a Check Anymore

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Paying bills with a check
Getty ImagesPayments by check have fallen by more than 50 percent since 2000, according to the Federal Reserve.
By Paul Sisolak

Check writing has become a lost art. There used to be something official about writing a personal check that made even the most minor transactions feel more important when you had to physically write out the recipient's name, dollar amount and sign your name in the bottom right corner.

In 2015, the personal check isn't what it used to be: Newer and more convenient payment methods have taken its place. According to a 2013 Federal Reserve study, payments by check have dropped more than 50 percent from 2000 to 2012, while electronic and card payments tripled. In a GOBankingRates poll last year, nearly 38 percent of 1,500 respondents admitted leaving their checkbooks completely unused.

At the same time, there's been a fivefold increase in the Google search term "how to write a check" over the last decade, according to an April article in The Washington Post. The Fed also reports that over 18 billion checks are written per year, which is proof they still have a place in this world.

So why have checks been on the decline? Here are a few reasons:

Mobile apps do the job faster and better. Checks are rendered nearly obsolete when peer-to-peer money exchanging and payment come into the picture. Smartphone apps such as Venmo, Apple Pay, Google Wallet and Tilt allow users to easily transfer money from one account to another. This is big business, not a passing trend. Venmo alone handles more than $1 billion in peer-to-peer payments annually, Business Insider reports. As for the mobile payment industry, a recent Business Insider analysis predicted Venmo will reach $86 billion in the next three years.

Retailers are phasing out checks with tech. Mobile technology has pushed out checks from the point of sale. Major brands such as Whole Foods Market, Old Navy, Gap and Lululemon Athletica have eschewed checks, while most online retailers (i.e., Amazon.com) don't offer checks at all as a payment option. Checks take time and money to process, so more stores and businesses are introducing tablet- and smartphone-based payment options at the cash register, such as Square Cash or LevelUp.

Online banking offers more incentives. Referred to as "eChecking" or "green checking," an increasing number of brick-and-mortar banks and credit unions are pushing paperless checking to save money and conserve trees. Customers might be swayed to make the switch with the added bonus of earning a higher interest rate on balances or zero fees for giving up traditional checking. Other online-only financial institutions -- such as Ally Bank, Bank5 Connect and Barclays -- don't deal in paper banking at all.

Checks haven't held up over the years. As consumers continue to embrace these new, convenient banking technologies, traditional check writing has naturally begun to die off with each passing generation. The 2014 GOBankingRates poll shed light on this pattern: Over 60 percent of respondents ages 18 to 24 said they never write checks, compared to roughly 75 percent of people ages 55 and up who still go the paper route.

Paper checks require mindfulness. While having a paper trail is great for documentation purposes, checks open up a host of potential security issues. A checkbook can be lost, giving anyone with a thieving urge to forge a payment with your account and routing numbers at their full disposal.

How to Write a Check

There may come a time when there's no Wi-Fi or Web access right when you need to complete a transaction, and writing a check is the best solution. You might also find yourself in a situation when a check is necessary, like making a rent payment. Despite the obvious benefits of electronic payments for tenants and landlords, 70 percent of U.S. renters still pay their monthly rent by paper check, according to PayLease, a company that collects rent payments for property managers.

Even if you never pay with a check for the rest of your life, you should always know how to fill one out the right way and be ready to do so. Here's a quick step-by-step guide:

1. Write the date in the top right corner. Make sure you enter the complete month, day and year on the line labeled "Date." You can write out the date in full (i.e., June 11, 2015), or use numbers (6/1/15 or 06/01/15).

2. Enter the name of your recipient. On the line labeled "Pay to the Order of," write the full name (first and last) of the person/group/company you're paying by check. Make sure to spell it right!

3. Enter the dollar amount. To the right, on the line with the dollar sign, write out the exact amount the check is payable for. Don't round up or estimate. A check for $122.51 should be written in that amount, not for $123.00.

4. Repeat the dollar amount, written out. On the line under your recipient's name, repeat the amount the check is for -- but this time, write it out in full. For example, you should write $122.51 as "One Hundred Twenty-Two and 51/100" (with the change amount written as a fraction). If it's an even amount, you can simply write "Two Hundred" if the check is for $200. If there's empty line space remaining, take this safety precaution: Draw a single line to the end of the field to prevent someone from adding new digits and altering the amount.

5. Fill out the Memo space (optional). The bottom left-hand corner of your check includes a space to tell the recipient what his or her payment is for. It could be "Air Conditioning Repair," "Pet Grooming," "Happy Graduation," etc. Take note that this space is optional, except when specified by the recipient; if it's a bill payment for cable, utilities or rent, the company or property manager may specify that you must enter your account number in the Memo field for ID purposes.

6. Sign your check. Your check is invalid if you don't sign your name on the line in the bottom right-hand corner. Remember, don't sign your name on the back of the check -- that space is meant for your recipient to sign when they receive it. When they do, and the check is cashed, its dollar amount will be deducted from your checking account.

Paul Sisolak writes for GoBankingRates.com, a source for the interest rates on savings accounts, CDs, mortgages, auto loans and more.
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