You may think of paper checks as a thing of the past, but there are payment options that can be made digitally like Venmo, Zelle, and Apple Pay, but there are some circumstances that it’s more beneficial to use paper checks. Here’s when it may be safer or preferable to use a personal check, how to use checks in a safe manner, and when it’s acceptable to avoid them.
Shopping at a Small Business
Because of their size and credit card processing costs, some small businesses aren’t able to accept credit cards. A study found that only 27% of small companies prefer electronic payments (think cash or ApplePay) over traditional payments (cash cheques, checks, and money orders). Therefore, if you contract someone to cut your lawn, purchase items from a local store (or flea markets vendor) or even employ a dog walker, you might want to keep a checkbook at hand to pay them.
Gifting Money
If you’re strapped for time and you’re planning an event like a birthday celebration, wedding, or any other celebration of the family It’s probably best to stash cash into a credit card. But when giving money as a gift, cat checks may be more appropriate instead of cash. While both cash and check could easily get lost when you are rushing to open gifts, one of them is specifically addressed to the recipient and the other isn’t. This will help the person receiving it remember who gave them the money. If they put the cash to the side, then revisit it later, they might not remember who gifted it to them.
Tracing Important Payments
If you are making a major amount of money for something such as an amount to be used towards a downpayment on a new house, a tuition fee for a college or deposit for a location for a wedding, or making a payment to a government agency, such as the IRS it is possible to use a paper check. This can help ensure your payment was received because you’ll be able to see how the other party deposited or cashes the cheque on your next bank statement. You can also view this via your bank’s online portal. Some banks will even give you an image of the cashed check to verify that the check is valid.
This may even help prevent you from incurring any costs for late payments as the transactions will be all in the same year. If your check gets missing or is stolen, you can demand to cancel your transaction through your bank’s customer service phone number or online through the website of your bank.
If You’ve Been the Victim of Fraud
Has your personal financial information been stolen or compromised? It’s not a problem for everyone. A study revealed that in the year 2018 14.4 million individuals in the U.S. were victims of identity fraud, to the tune of $3.4 billion. In addition, the study showed that more victims were forced to pay from their own pockets to pay expenses associated with the fraud.
With these figures, it’s only natural to want to keep your information protected if your experience has dealt with similar issues. Most people opt to continue cash or paper checks in lieu of swiping a debit or credit card in local stores. Some may not want to input their payment details on the internet at retailers’ websites or utilize online and digital payment methods.
While writing a paper-based check isn’t an absolute security measure keeping your private information offline and swiping your credit card with caution could assist in reducing the likelihood of identity theft and fraud, and other financial crimes.