This bank account surprise could throw your budget off track

Have you ever logged in to your bank account to check the balance and been surprised to see that the amount is lower than you expected?

If you live paycheck-to-paycheck, you know that every penny counts. That's why you keep a budget and track your expenses. 

So when there's a difference between the amount you have and the amount you thought you had, it helps to understand why. And the answer just might be pending transactions. 

What are pending transactions?

Pending transactions are transactions that your bank still needs to clear or process. Your bank account can show two kinds of pending transactions. 

• Pending credits. These are amounts that will be added to your balance. Examples include direct deposit, cash deposits, or check deposits. 

• Pending debits. These are amounts that will be subtracted from your balance. Examples include bill payments, ATM withdrawals, or debit card purchases. 

All of these transactions involve the movement of money from one bank to another, which takes time. That's why it's not unusual to see pending transactions in your bank account. 

Why it's important to track pending transactions

There's a good reason to keep up with pending transactions. It's the best way to avoid an overdrawn account. 

Overdrawn means your bank account balance is negative. An overdrawn account can happen when the bank processes bill payments, checks, or debit card transactions but you don't have enough money in your account to cover them. 

When your account is overdrawn, you have to deposit money to bring the balance positive. The kicker is that an overdrawn account can trigger fees. 

Banks can charge overdraft fees, returned item fees, or non-sufficient funds fees. And they can charge you multiple fees for the same transaction, which means you have to deposit even more money to get back into the black. 

Cash-strapped Americans regularly have less than $50 in the bank, according to our latest consumer survey. If your balance strays into that territory, it's even more important to stay on top of pending transactions so you don't risk an overdrawn account. 

How to improve cash flow when you live paycheck-to-paycheck

Pending transactions could throw you off when it's time to make your budget or pay bills, but there's a simple fix. 

When you log in to your bank account, you should see two numbers where the balance should be. One is the current balance; the other is your available balance. 

Here's the difference. 

• Your current balance is the amount of money currently in your account.

• The available balance is the amount that’s available to you. It reflects pending transactions that haven’t cleared yet. 

The available balance could be lower than the current balance because it subtracts your pending transactions. If you need to pay bills or want to know how much you can spend on gas or groceries for the week, use your available balance as a guide. 

The Achieve MoLO app makes it easy to compare what you earn vs. what you spend. You can link all of your bank accounts in one place to get a full financial snapshot, and the app is free to use. It gives you a simple roadmap view of your upcoming transactions—so it’s easy to keep an eye on what payments are coming up and plan for them. 

A Debt Care™ plan could help you get financially fit

Everybody wants to reach financial success, but we all have a different vision. For example, your vision might include freedom from credit card debt or a comfortable emergency fund tucked away in the bank. 

Whatever your goals are, it helps to have a plan. If you're not sure where to start, the Achieve Debt Care ™ program can help. 

This free resource provides you with a blueprint to create and maintain a good debt fitness routine.

You can take our debt health quiz to find out your personal Debt Fit™ Score. This score measures your debt health based on your:

• Unsecured debts

• Cash flow

• Financial risk profile

• Money goals

Take the Debt Fit™ quiz now to gauge your financial well-being.