What Are Personal Checks — and Are They Still Useful?

A decade ago, if you’d asked anyone whether personal checks were useful, you probably would have received a perplexed look or a one-word response: Duh.

But fast-forward to 2016, and it’s a valid question. Checks were once a common way to pay for almost anything, including groceries and utility bills, but they’ve been largely replaced by debit and credit cards, mobile payments and online bill pay.

That doesn’t mean you should chuck your checkbook into the trash can, though. Here are a few reasons why you might need to write a check every now and then, along with the pros and cons of doing so.

What are personal checks, and how are they useful?

A personal check is a slip of paper issued by your bank and linked to your checking account on which you write an amount of money, and a recipient who will receive that money. The check is a promise that the money will be there when the recipient redeems it, whether hours, days or weeks later. Checks are like slow-motion debit cards, which is why they can seem out of date.

But certain transactions still require checks. For instance, some landlords insist that tenants pay rent that way. And some small businesses don’t accept credit or debit cards.

If you prefer to stay disciplined with your spending, checks or cash can also be a better choice than plastic.

» MORE: How to write a check

Pros 

You avoid convenience fees. Some businesses, including many property managers, charge convenience fees for electronic payments. Payments via paper check are usually free.

There’s old-school security. If your wallet or purse is lost or stolen, you can kiss your cash goodbye, and a thief can make small credit card purchases without a signature. But banks and merchants still require a signature on every check.

It’s an offline option. According to the Pew Research Center, 15% of U.S. adults don’t use the Internet. Paying bills with a check is much easier for these consumers than paying in person with cash.

Cons

Checks can cost money. Paying with a check can help you avoid convenience fees, but you may still have to pay for your actual checks, and you’ll definitely have to shell out a few bucks each month for envelopes and stamps. Try finding a checking account that offers free checks, which some of the best accounts do.

Processing takes longer. Cash, credit, debit or smartphone transactions process fairly quickly. You’ll also know how much you have left to spend immediately after the purchase. But check payments aren’t posted to your account until the recipient cashes the check — so if you forget to log a payment or miscalculate your remaining balance, you could overdraw your account.

Writing them is inefficient. Imagine that you and your friend enter separate checkout lines at the store. Hers is for customers carrying cash and yours is for those with checks. Chances are good that she’ll be waiting in the car for awhile before you get out.

Next steps

If your checking account offers free checks, you might as well order a batch. And even it doesn’t, it might be handy to have some available — just make sure you don’t overpay for them. That may mean ordering them from somewhere other than your bank or credit union.

Tony Armstrong is a staff writer at NerdWallet, a personal finance website. Email: tony@nerdwallet.com. Twitter: @tonystrongarm.

This post was updated. It was originally published Aug. 8, 2013.

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