Remember the last time you needed to pay someone and didn't have cash or want to use a credit card? For many, the trusty cheque still comes to the rescue. While electronic payments are increasingly common, understanding how to properly write a cheque remains a valuable skill. Knowing the ins and outs prevents fraud, ensures your payment is processed correctly, and allows you to confidently manage your finances.
Writing a cheque might seem straightforward, but even a small mistake can cause delays, rejected payments, or even worse, open the door to potential fraud. By following a few simple steps and paying attention to detail, you can master the art of cheque writing and avoid common pitfalls. This guide will walk you through each section of a cheque, explaining exactly what to write and where to write it, using a clear and easy-to-follow example.
What are the key elements I need to include when writing a cheque to ensure it's valid and secure?
What's the best way to void a check if I make a mistake when writing it?
The best way to void a check is to clearly write "VOID" in large letters across the face of the check, making sure the word covers all crucial areas like the payee line, amount boxes (both written and numerical), and signature line. Using a pen with dark, permanent ink is recommended to prevent alteration. Retain the voided check for your records.
Voiding a check properly ensures that it cannot be fraudulently cashed or altered to debit your account. Simply tearing up the check might not be sufficient, as the pieces could be reassembled. Similarly, only marking through certain parts of the check, like the amount, could still leave it vulnerable to manipulation. Writing "VOID" across the entire check renders it unusable in a clear and unambiguous manner. After voiding the check, you should also record the check number and the reason for voiding it in your check register or accounting software. This helps maintain accurate records of your transactions and prevents confusion in the future. Never throw away a voided check without first properly marking it as void, and it’s generally best to keep the physical voided check with your records for auditing or reconciliation purposes. If your bank offers online check imaging, you may want to confirm that the voided check image is properly recorded in their system as well.How do I properly write the amount in words on a cheque example?
When writing the amount in words on a cheque, clearly and accurately spell out the numerical dollar amount, followed by "dollars," and then write the cents as a fraction out of 100. For example, if the cheque is for $52.75, you would write "Fifty-two dollars and 75/100". Draw a line after the fraction to prevent anyone from adding to the amount.
To elaborate, start with the whole dollar amount, expressing it fully and correctly. Use connecting words like "and" only to separate the dollars from the cents portion. Avoid using "and" anywhere else in the dollar amount. So, instead of writing "One hundred and twenty dollars," write "One hundred twenty dollars." The cents portion is always written as a fraction with 100 as the denominator. This is a security measure to prevent fraudulent alterations. For instance, if the amount is $10.50, write "Ten dollars and 50/100". Furthermore, pay close attention to spelling. Misspellings can cause confusion and potential rejection of the cheque by the bank. Words like "forty" (not fourty) and "ninety" (not ninty) are common errors. Ensure that the written amount precisely matches the numerical amount entered in the box provided. If there's a discrepancy, the bank will usually honor the written amount, but it's best to avoid this situation by double-checking your work. Always use a pen and write legibly to further reduce any potential issues.Where does the date go on a check, and what format should I use?
The date goes in the upper right-hand corner of the check. You should use a standard date format, most commonly MM/DD/YYYY. For example, if today is January 15th, 2024, you would write 01/15/2024.
While MM/DD/YYYY is the most prevalent format in the United States, some banks and businesses might accept other formats. However, sticking to the standard minimizes the chance of confusion or processing delays. Using a clear and unambiguous date prevents any misinterpretation that could lead to the check being rejected. It's crucial to write the date clearly and legibly. Avoid abbreviations or unconventional formats. Never post-date a check (writing a future date), as it might not be honored until that specific date, and some banks may even refuse to process it. Similarly, avoid writing a date in the past, as some banks have time limits on how long a check remains valid. Consistently using the MM/DD/YYYY format ensures clarity and helps the check processing go smoothly.What if I don't know the payee's exact name when writing a cheque?
If you don't know the exact legal name of the payee, you should try to obtain it. However, if that's not possible, you have a few options, each with associated risks. You can write a check to the best of your knowledge, use a more generic description, or delay writing the cheque until you have the correct information.
Using the best information you have is often the most practical route. If you're unsure of the exact legal name but know the business operates under a "doing business as" (DBA) name, you can write the cheque to that DBA name. For example, if you believe you're paying "Joe's Pizza," but the legal name is "Pizza Paradise Inc.," you might risk writing to "Joe's Pizza." The bank *may* still accept the cheque, especially if the DBA is well-known and clearly associated with the legal entity. However, the bank is not obligated to do so, and it could be rejected. Another option is to use a more generic description, such as "Maintenance Services" if you're unsure of the contractor's exact name. This increases the risk of fraud or misdirection, as anyone performing maintenance could potentially cash it. This should only be used when other avenues are exhausted and the amount is small. Ultimately, the best approach is to delay writing the cheque until you can confirm the payee's correct legal name, either by asking them directly or checking their invoice or contract. This minimizes the risk of the cheque being rejected or cashed improperly.Can I use a different coloured pen to write a cheque example?
While technically a cheque written with a pen of any color may still be processed, it is strongly advised against using any color other than blue or black ink. Banks prefer blue or black ink because it is easily photocopied and provides a clear, legible record, reducing the chances of fraud or processing errors.
Using a pen with blue or black ink ensures the cheque can be clearly read by both the bank's automated systems and by any human teller who may need to review it. Other colors, particularly lighter shades or inks prone to fading, may not reproduce well, potentially leading to delays, rejection of the cheque, or even suspicion of tampering. The standardized use of blue or black ink creates a more reliable and secure paper trail for financial transactions. Furthermore, sticking to blue or black ink helps prevent any confusion or misinterpretation of the information written on the cheque. It demonstrates a level of professionalism and adherence to best practices, reassuring the recipient and the bank that the cheque is authentic and valid. Using unconventional colors could inadvertently raise red flags and cause unnecessary scrutiny, hindering the smooth processing of the payment.Is it safe to leave the "For" or "Memo" line blank on a cheque?
It's generally considered safe to leave the "For" or "Memo" line blank on a cheque, as this field is primarily for your record-keeping and doesn't affect the cheque's validity or negotiability. However, it's *more* prudent to fill it in whenever possible to maintain accurate financial records and reduce the potential for misuse or ambiguity.
While the "For" or "Memo" line is not a required field for processing a cheque, providing a brief note about the cheque's purpose offers several benefits. For example, if you're paying a bill, you can write the account number or invoice number in the memo. This helps you easily track your payments when reviewing your bank statements and can also assist the recipient in properly allocating the funds to your account. Leaving it blank means you rely solely on your own records to remember the cheque's purpose. Furthermore, although rare, a filled "For" or "Memo" line can provide some additional context in the event of a dispute or accounting error. While it's not legally binding proof, it can serve as supporting evidence of your intentions. In instances where a cheque might be questioned, a clear memo can help clarify the situation. While not essential for the cheque's validity, taking the extra few seconds to fill this line adds a layer of security and clarity to your financial transactions.What precautions should I take when mailing a written cheque example?
If you must mail a written cheque example, prioritize security to mitigate the risk of fraud or identity theft. Primarily, never send a real, valid cheque as an example. Instead, use a marked "VOID" cheque or create a mock cheque with fictional account details. Further precautions involve obscuring sensitive information and employing secure mailing methods.
When creating a cheque example, the most important safeguard is to ensure it's unusable for fraudulent purposes. Write "VOID" prominently across the front of the cheque in large, clear letters, rendering it non-negotiable. Alternatively, create a completely fake cheque using software or templates, being careful to invent routing and account numbers. Never use your actual bank details. For added security, consider blurring or digitally removing sensitive fields like the account number and routing number if the example will be displayed online. Even when using a "VOID" or fake cheque, package it securely. Place the example in an envelope that doesn't reveal its contents. Use a sturdy envelope to prevent tearing. If possible, consider sending it via a trackable mail service. While this adds cost, the tracking number offers a degree of security, allowing you to confirm delivery and providing evidence if the envelope is lost or tampered with. Remember, the aim is to minimize the risk of your sensitive financial information falling into the wrong hands, even if it's just an example.And there you have it! Hopefully, this little guide has made writing cheques a bit less daunting. Thanks for stopping by, and we hope you'll visit us again soon for more helpful tips and tricks!