What Is a Bank Statement? Everything You Need To Know
A bank statement itemizes all the activity affecting your account over the past statement period, which is usually a month. It also shows what the balance was at the beginning and end of the statement period and has important information such as your account number and contact information for your bank.
Reviewing your statements is a good way to stay on top of your savings and spending and watch for fraud.
What Is a Bank Statement?
A bank statement is a document provided by a bank that shows a summary of financial transactions over a month or quarter. It shows a running list of money that was credited to and debited from your checking account or savings account along with the date of each transaction, a description explaining what the transaction was and your balance after the transaction was credited or debited.
In short, it’s a snapshot of your banking activity. It can also be a useful tool for understanding your spending habits, pending transactions and overall finances. Taking the time to monitor yours means you can catch issues that might otherwise go unnoticed, such as fraudulent charges.
What Information Is on a Bank Statement?
Although you will see some differences in layout between different banks, most bank statements will include the following information:
Account activity: This section details all of the transactions made during the statement period. This includes purchases, deposits and withdrawals.
Account balance: This is the amount of money in the account on the closing date.
Account number: This identifies the bank account.
Account summary: This provides an overview of the account, including the opening and ending balances, deposits, withdrawals and fees.
Account type: This identifies the type of account, such as checking or savings.
Annual percentage yield: This tells you the interest rate your balance earned during the statement period, and the bank must include the dollar amount as well.
Bank contact information: This section has the mailing address, phone numbers of the bank where you opened the account, and the website details for the bank’s customer service department.
Credits: This is the money credited to the account during the statement period. Credits include:
Deposits you made at a branch, ATM or via mobile deposit
Direct deposits from your employer or benefits provider
Interest payments from the bank
Reimbursements — for example, refunds for returned merchandise you purchased with your debit card
Statement credits from a bank reward program
Debits: This is the money removed from the account during the statement period. Debits include:
Debit card purchases
Bills payments made using your debit card or account number
Automatic debits
Checks
Withdrawals made via ATM or at a branch
Bank fees, including monthly service fees, overdraft fees and fees for wire transfers, check orders and other bank services you used
Fees: You’ll see fees in your account summary and in the debits and withdrawals section, but the bank must also include what type of fee it is.
Statement date: The date that marks the end of the statement period is typically located at the top of the document.
Your name and contact information: Make sure to check that the details are correct and report any errors to the bank.
Federal law requires banks to include either the number of days in the statement period or the start and end dates.
Types of Bank Statements
You can get your statements in two forms: electronic and paper. If you opt for paper, the bank will mail the statements to you, usually for a fee. Electronic statements are typically free, and you access them via online banking or mobile app.
How Do You Get a Bank Statement?
Most banks and credit unions send bank statements to account holders each month or quarter. Customers can decide if they prefer paper statements mailed to them or electronic statements they can access through the bank’s website or mobile app. Here are steps you can take to access and monitor your bank account statements:
Log in to your bank’s website or mobile app.
Locate the section where the statements are available.
This may be labeled as “bank statement” or “e-statement,” depending on the bank.
Choose the statement for the period you want to view.
Review the statement and file it for your records. Your bank will keep your statements on file for up to seven years, depending on its policies.
You have the option to download the statements or print paper copies.
Log out of the website or mobile app.
This is especially important if you’re using a public or shared computer. The next person to use the computer will have access to your account and banking information if you’re still logged in.
Paper Statements
Wondering how you can get a bank statement mailed to you? If you prefer to receive paper statements, your bank will mail them to the address it has on file. You can check or change this address by looking for the personal information section of your account.
Why Should You Review Your Bank Statement?
Although your bank statement might seem like an unnecessary piece of paper, it can help you make sure your account balance and transactions are accurate. It can also serve as proof of income and a comparison tool to track how you’re spending money.
Reconcile Your Bank Account
When you reconcile your bank account or balance your checkbook, you compare your own record of your spending to the bank’s record. This helps you keep track of your expenditures so you can budget appropriately and monitor where your money is going. Knowing how much money you have in your account also helps you plan for the future.
Look For Mistakes
Reviewing your bank statements provides an additional opportunity to catch and correct mistakes. This includes inaccurate charges by merchants and fraudulent transactions, which may be the first sign of identity theft. It’s easier to correct these errors when you report them while you still have original receipts.
File for Your Records
Many banks recommend that customers keep bank statements for one year before destroying them. You may need them to verify deductible expenses you claim on your tax return or use them as proof of income. If you’re self-employed, your bank statement may be the only proof of income you have since you don’t have a W-2 issued by an employer. If you prefer not to have paper statements, check with your bank’s online banking site to find out how long it saves statements. If it’s less than a year, set a reminder to download statements periodically.
Banks are only required to send statements for accounts that can have incoming or outgoing electronic funds transfers. That means you’ll receive them for checking, savings, high-yield savings and money market accounts but not for CD accounts.
Final Take To GO
Reviewing your bank statement is a helpful habit for monitoring your money and keeping your finances in check. Don’t delete the notification that your statement is available for viewing or toss the unopened envelope in the trash can. Instead, set aside time to check yours every month.
FAQ
Here are the answers to some of the most frequently asked questions about bank statements.
What is bank statement proof?
A bank statement can prove what funds were taken or deposited into your account and when. This can help with proving if a bill was paid or if there was fraudulent activity on your account.
What five things will be shown on your bank statement?
Among other pieces of information, five things most commonly shown on your bank statement include:
Issuing bank information
Dates of statement period
Account balance range
Completed transactions
Your account number and basic personal information
Who can see your bank statement?
Authorized bank employees have access to your statements. Otherwise, only you -- and other account owners, if you have a joint account -- can see it.
Caitlyn Moorhead and Daria Uhlig contributed to the reporting for this article.
This article originally appeared on GOBankingRates.com: What Is a Bank Statement? Everything You Need To Know
