December Financial Fitness Challenge—Write Checks Right, or Pay a Price
A few weeks ago, a friend handed me a check for her portion of a shared purchase. One glance at her check and I knew what I'd be writing about this month.
She had made the check out with the numerals centered on the short line on the right side, and she indented the text line a good half inch from the left side. I chuckled and told her, "If I were a crook, I could doctor this check to steal a bit of money from you."
This illustration shows how:
My friend—one of the sharpest money managers I know, by the way—was good-natured about my teasing because she knew I was looking out for her. And the experience made me wonder if check writing is becoming a lost art.
It could be. Because so many of us rely on debit cards and online bill payments these days, it stands to reason that we're less aware of the safe way to make out a check. That's all the more reason to do it properly on the rare occasions when we have to write a check.
It's pretty easy for a crook to make small changes, like the ones shown above. And maybe that small theft wouldn't draw your attention when it shows up in your printed or online statement—something a petty thief counts on.
But if you're careless about check writing, you make it just as easy for a crook to make larger and more expensive changes. Here's an example of bolder thievery:
Endorsements matter, too
The way you endorse a check also can leave you open to theft.
Before you deposit a check, you must sign your name on the back. This endorsement can be as simple as your signature, but that seldom is the best choice.
Here are your options:
Of course, for all the checks you receive routinely, like a paycheck or benefit check, your best choice is to use direct deposit. It's easy to set up and saves time and inconvenience. It's also bullet-proof safe.
By March 1, 2013, anyone who gets a Social Security or Veterans Affairs benefit, as well as a few other types of government check, will have to use electronic payments to receive their benefits by direct deposit to an account or to a specific debit card, via the Go Direct program. If this change affects you, learn more about it before the effective date.
Your unique signature
Another part of check security is your name and signature itself.
Have checks printed with your full name, Elizabeth Swenson, for example, instead of Liz Swenson. Then always sign your checks using that form of your name, and in the same style of penmanship. This makes an impostor's signature more likely to stand out and be detected.
In fact, it's a good idea to develop and use the same consistent signature on all your formal documents.
Here are a few more things to know about safe use of checks and share drafts:
For any questions about your checking habits, talk to a teller at the credit union. Credit union staff can help, too, when you're ready to introduce a young member of your family to the grownup world of checking accounts.
Financial Fitness Challenge
Your credit union money mentors bring you this website and other tools to help you make the most of your financial resources. The Financial Fitness Challenge continues to look at ways you can make better financial habits no matter what condition the economy is in.
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