In this article:
Bank statements help you keep track of all the transactions made in your account during a specific period. You can use it to track expenses, identify accounting errors and spot potentially fraudulent activity.
These statements can be invaluable in helping you understand what's going on with your money. But the abundance of information in your statement can be overwhelming for some. Not sure how to read your bank statement? You can read your bank statement by understanding its different sections, as outlined below.
What Information Is on a Bank Statement?
Your bank statement usually displays everything that happened with your account during the statement period, including deposits, withdrawals, transactions and fees. In most cases, your statement is broken down into several sections to make the report more easily digestible. Typically, your report should include the following information:
1. Statement Period
Near the top of your statement, you should see the statement cycle listed, which shows the period the statement covers. Look for words like "statement ending" followed by a date, such as "Statement Ending April 27, 2024" or simply "March 28, 2024, through April 27, 2024."
2. Bank Information
Next, you should see the bank's logo and vital customer service contact details. This information should include the website URL, customer service numbers and the physical address for payments sent through the mail.
3. Personal Information
Your name, address, phone number and other personal information also appear near the top of your bank statement. Quickly review this information to make sure it's correct and up to date. Incorrect information could be a red flag for fraudulent activity on your account. In that case, contact customer service immediately to resolve the matter and ensure your bank account is secure.
4. Account Summary
Your account summary is a macro view of your account, listing your beginning and ending account balances, along with totals for deposits, withdrawals, purchases, fees and other relevant information.
5. Interest Earned Information
Statements for savings, certificates of deposit or other deposit accounts should include a summary of the interest your account is earning. This breakdown usually includes your interest earned during the statement period and your total interest earned year-to-date.
6. Account Activity
Reviewing your account activity can give you a complete picture of what is going on with your account funds. Whether your activity is listed in separate sections or included all together, it should include the following in chronological order:
- Deposits, credits and payments: Every ATM or direct deposit, credit or other activity that deposits money into your account is itemized with dates for your review.
- ATM and debit card withdrawals and transactions: Likewise, your statement details every instance money leaves your account, including debit purchases and account withdrawals.
- Fees: Depending on your bank, your account activity may list monthly service fees, insufficient funds fees and other charges among your other account activity, in a separate fee section, or both.
How Often Should You Check Your Bank Statement?
As a rule of thumb, you should review your bank statement at least once a month when your new statement is issued. With online access allowing for quick review, many account holders reconcile their bank statements more frequently, such as once every week or even daily.
Regularly reconciling your bank statement can help you gain more control over your finances by helping you:
- Balance your checkbook
- Verify check deposits or payments cashed
- Spot bank errors
- Detect unauthorized transactions or suspicious activity
- Identify fees for little-used subscriptions or memberships you may want to cancel
- Correct mistakes in your accounting that might lead you to overestimate your available funds
Financial experts often recommend keeping your bank statements for one year to prepare for filing income taxes, proving your income or other purposes. Similarly, it's wise to hold on to your statements for at least seven years if you need them to support information contained in your tax returns. Many banks allow you to access statements for up to seven years when you opt for paperless statements.
What to Do if You Notice Errors on Your Bank Statement
In most cases, you should notify your bank immediately after noticing an unauthorized transaction, missing money or other inaccuracies on your bank statement. In addition, if your debit card becomes lost or stolen, you must notify your financial institution within two business days of noticing the problem. If you do, you'll only be responsible for the lesser of the unauthorized transaction amount or $50.
Even if you didn't lose your debit card, security code or PIN (or had them stolen), you still must inform your financial institution within 60 days of a fraudulent transaction appearing on your bank statement. You could be held financially responsible for the charge if you wait longer than 60 days.
You're responsible for reviewing your bank statements and advising the bank of any errors. Even if there's a bank error in your favor, don't touch the money and instead notify your bank immediately. If you use the money, not only could you be responsible for paying it back, you could even be criminally prosecuted.
Check Your Bank Account and Credit Report Regularly
Your bank isn't required to send you a monthly bank statement unless you make one or more electronic fund transactions in a month. But even if you don't make a qualifying transaction, most financial institutions send bank statements to their account holders each month.
It's a good idea to check your paper bank statement once a month when it arrives. Another good financial habit is to check your bank account activity regularly online to spot errors, confirm payments and ensure you have enough money for transactions.
As you keep tabs on your bank account activity, don't forget to monitor your credit health by using Experian's free mobile app. You can access your Experian credit report and FICO® Score☉ and receive real-time notifications about potential fraud.