Cheques: Traditional Yet Still Essential in Money Management

In today’s world of online banking, mobile apps, and digital payments, traditional methods like cheques might seem outdated. However, there are still scenarios where writing a cheque is necessary. Understanding how to properly fill out a cheque can save you from mistakes and ensure smooth transactions. This guide will help you navigate through the process of writing, voiding, and understanding cheques.

Steps to Write a Cheque

Writing a cheque involves a few simple steps. Here’s a clear guide:

1. Date: Write the date in the top right corner. This should be the same date you sign the cheque.
2. Payee: On the line labeled “Pay to the order of,” write the name of the person or organization. If you write “cash,” anyone can cash the cheque.
3. Amount in Numbers: Write the amount in numerals next to the dollar sign. Ensure it includes dollars and cents, formatted as $XX.XX.
4. Amount in Words: Spell out the amount in words, including the cents as a fraction. For example, $125.50 would be “One hundred twenty-five and 50/100 dollars.”
5. Signature: Sign the cheque in the bottom right corner. Without your signature, the cheque is invalid.
6. Memo: (Optional) Fill out the memo section to note the purpose of the cheque.

What to Do After Writing a Cheque

After completing your cheque, tear it from your chequebook and keep a record. If your chequebook has carbon copies, retain the duplicate for your records. If not, update your cheque register with transaction details.

How to Void a Cheque

If you make an error or need to provide a void cheque for account verification, write “VOID” across the entire cheque. This prevents anyone from cashing it.

Demographics of Cheque Users

Data suggests that individuals aged 25-34 are most likely to search for information on writing cheques.

Writing a Cheque to Yourself

To transfer money between accounts, you can write a cheque to yourself. Write your name in the “Pay to the order of” field and endorse it on the back before depositing.

Correcting Mistakes on a Cheque

If you make a mistake, cross out the error with a single line, write the correct information above, and initial the correction. For significant errors, it’s best to void the cheque and start over.

Writing a Cheque to Cash

Writing a cheque to “cash” allows anyone to cash it. To do this, write “Cash” in the “Pay to the order of” field, fill out the amount in both numbers and words, and sign it.

Secure Ways to Send or Give Cash

• Interac e-Transfer: Secure domestic transfers using email or mobile number.
• Money Transfer Services: Options like MoneyGram and Wise offer competitive rates.
• Certified Cheques: Guaranteed by the bank, preventing bounced cheques.
• Bank Drafts: Funds are withdrawn when the draft is issued.
• Money Apps: Apps like Revolut offer instant, secure transfers.

Tips for Cheque Security

• Use pen, not pencil.
• Regularly review your account.
• Don’t sign a blank cheque.
• Draw lines through unused spaces.
• Keep your signature consistent.
• Shred old cheques.

Understanding Cheque Numbers

Cheque numbers guide banks in processing the cheque:

• Cheque Number: Sequential number of the cheque.
• Transit Number: Identifies your bank branch.
• Institution Number: Identifies your bank.
• Account Number: Specific to your account.

Canadian Banks’ Cheque Details

Demand for Cheques

Despite the digital age, some Canadians still prefer cheques. According to a recent survey, 3.31% seek bank accounts with cheque features.

Conclusion

While digital payments are quick and convenient, knowing how to write a cheque is still valuable. Whether it’s for rent, a deposit, or transferring funds, cheques remain a reliable payment method. If you need more information on chequing accounts, check out our guide to the best options in Canada.