Are personal checks still useful?
A decade ago, if you鈥檇 asked聽anyone whether personal checks were useful, you聽probably would have received聽a perplexed聽look or a one-word response:聽Duh.
But fast-forward to 2016, and it鈥檚 a valid question. Checks were聽once a common way to pay for almost anything, including聽groceries and聽utility bills, but they鈥檝e been largely聽replaced聽by debit and credit cards, mobile payments and online bill pay.
That doesn鈥檛 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聽the pros and cons of doing so.
What聽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.聽The check is a promise that the money聽will be there when the recipient redeems it, whether hours, days or weeks later. Checks are聽like slow-motion debit cards, which is why they can seem out of date.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聽small businesses don鈥檛 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.
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You avoid convenience聽fees.聽Some businesses, including many property managers, charge convenience fees for electronic payments. Payments via paper check聽are usually聽free.
There鈥檚 old-school security.聽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鈥檚 an offline option.聽According to the聽, 15% of U.S. adults don鈥檛 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.聽Paying with a check can help you聽avoid convenience fees, but you may still have to pay for your actual checks, and you鈥檒l definitely have to shell out a few bucks each month for envelopes and stamps. Try finding聽a checking account that offers free checks, which some of the聽听诲辞.
Processing takes longer.聽Cash, credit,聽debit or smartphone transactions聽process fairly quickly. You鈥檒l also know聽how much you have left to spend immediately after the purchase. But check payments aren鈥檛 posted to your account until the recipient cashes the check 鈥� so if you forget to log a payment or miscalculate your remaining balance, you could overdraw your account.
Writing them is inefficient.聽Imagine that you and your friend enter separate checkout lines at the store. Hers is for customers carrying聽cash and yours is聽for those with checks. Chances are good that she鈥檒l聽be waiting in the car for awhile before you get out.
Next steps
If your checking account offers聽free checks, you might聽as well order a batch. And even it doesn鈥檛, it might be handy to have some available 鈥� just make sure聽you don鈥檛 overpay for them.聽That may mean ordering them from聽.
Tony Armstrong is a staff writer at NerdWallet, a personal finance website. Email:聽tony@nerdwallet.com. Twitter:聽.
This post was聽updated. It was originally published聽Aug.聽8, 2013.
