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Money

One mistake you make when you deposit checks using your phone

Banking is so much easier now than when I was a kid. I remember getting my first check and running to the bank and feeling that rush of joy when the clerk handed me my receipt. Nowadays the whole process is streamlined: Just open up your banking app, take a few photos of your check and you’re done.

Thanks to bank apps on your smartphone, you can deposit checks in just a minute — no more driving or waiting in line. Tap or click here for the best five online banks. However, you still have to be careful: Online banking comes with its own risks.

I’m not just talking about potential scams and hackers. You’ve also got to watch out for the biggest mistake people make when they deposit checks from their phones.

Have you ever done this?

In theory, depositing a check via your smartphone is as easy as following these steps: 

  1. First, open your mobile banking app. 
  2. Sign in to your account and select Deposit Check. You may be asked to choose which account you want to deposit to at this point.
  3. From there, take a photo of the front and back of your check. Make sure to keep a steady hold on your phone or tablet — you don’t want any blurry numbers.
  4. Then, if you haven’t already, choose which account the deposit should go to. Do you want it in your Checking or Savings account?
  5. Enter the amount written on the check. (Note: This step could come sooner, depending on your bank.)
  6. Tap Continue, confirm the details and select Deposit.
  7. Hit Done and you’re good to go.

That’s when you’ll get a message saying your check is processing. Watch out, though. You shouldn’t immediately write this off as done — there’s still more to do.

Watch for checks that haven’t cleared

It’s tempting to just upload your check, then throw it into the trash. After all, you may think, “Now that’s over and done with. Time to move on to bigger and better things!”

Not so fast. It’s likely your check will take some time to clear. Of course, there are a few different factors to consider:

  • The check amount 
  • How long you’ve been with the bank 
  • The status of the check payer’s account

Usually, checks clear pretty quickly. But you want to leave yourself enough time to make sure you get your money. That’s why I recommend waiting for two weeks until you trash a check.

Set a reminder for 14 days from now

Once you’ve deposited a check through your banking app, head to whichever app you use to set reminders. I go with Google Calendar, where I keep track of all my meetings and appointments. Pick a day two weeks from the time you uploaded the check. Now, it’s time to stow your check in a safe place.

Why go through the extra steps? Imagine you get a check for $500. You upload it to your app and throw the hard copy away when you’re done.

In a worst-case scenario, the check bounces for some reason. Now, your bank account is $500 short and you have no way to prove the money should be there. After all, you threw the check away.

That’s where that handy reminder comes in. After you make the deposit, write down the date on the check and store it in a safe place, like a filing cabinet or your desk drawer. After two weeks, you’ll get a digital nudge to see if the check has gone through.

MORE BANKING SMARTS: Tap or click here for the FBI’s word on banking scams you need to watch for.

Make sure to shred the check once you’re done

Now that more Americans are using online banking than ever before, you’ve got to watch your money like a hawk. Get this: 91% of Americans banked virtually in July, according to a recent study from DepositAccounts.

During the pandemic, we’re looking to digital solutions for all kinds of errands (I’ve been getting my groceries delivered for months!), banking included. Unfortunately, cybercriminals know that and there are more threats than ever when it comes to your money.

That’s why I want to leave you with some final words of advice:

  • Always use two-factor authentication: This adds an extra layer of protection between your account and someone looking to break in. Set this up in your bank’s app.
  • Never set up auto logins on your banking apps: Set your app to require your password, fingerprint or another login method every time you open it.
  • Secure your phone with a strong password: This is a no-brainer and the easiest way to protect everything on your phone from thieves and snoops.
  • Never bank on public Wi-Fi: You never know who could be looking in. Your best bet if you’re banking away from home is using a VPN.

For even more info on securing your financial accounts and step-by-step directions, here are nine ways to get started.

Nowadays, we’re all trying to stay safe — physically and financially. A few extra steps are well worth the effort if it means protecting your wallet.

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