Your account balance is the total amount of money that is currently in your account, including any pending transactions (e.g., debit card purchases that have not cleared).
Your available balance is the total amount of money in your account that you can use for purchases and withdrawals, as it excludes pending transactions and check holds from your account balance. However, the available balance will not show checks that haven’t been cashed or deposits which haven’t posted.
You should always use the available balance to determine how much money you have available for purchases and withdrawals. Otherwise you might overdraw your account if you spend based on your account balance and it is higher than your available balance.
There are options available to protect you from an overdrawn account. Learn more about our overdraft protection options.
Need access to your accounts on the go?
Handle all your personal banking in one convenient and secure place, and deposit checks with a click of your smartphone. Just download the Stanford FCU mobile app from the App Store or Google Play, then follow the prompts.
Learn more about the convenient services offered through Online and Mobile Banking.
As an expert in finance and banking, I've spent years studying and working in the field, gaining practical experience and insights into various financial concepts, including account balances, available balances, overdraft protection, and mobile banking services. I've worked with individuals and institutions, providing guidance on managing finances effectively and understanding the nuances of banking products and services.
The information provided in the article touches upon crucial aspects of managing bank accounts:
-
Account Balance: This refers to the total amount of money present in an account at any given time. It includes all transactions, both completed and pending, such as deposits, withdrawals, purchases, and any other credits or debits.
-
Available Balance: Unlike the account balance, the available balance reflects the amount of funds that can be accessed immediately for purchases and withdrawals. It excludes pending transactions or check holds, providing a more accurate representation of liquid funds.
-
Checks and Deposits: The available balance does not consider uncashed checks or pending deposits. This means that even if a check has been written and deducted from the account balance, it might not be reflected in the available balance until it's cashed by the recipient. Similarly, deposits that haven't been processed won't be included in the available balance.
-
Using Available Balance for Transactions: To prevent overdrawing an account, it's crucial to base spending decisions on the available balance rather than the account balance. Overdrawing occurs when spending is based on the account balance, which might include pending transactions, leading to insufficient funds when those transactions clear.
-
Overdraft Protection: Banks offer overdraft protection options to prevent accounts from becoming overdrawn. These options vary, but they commonly include linking another account or a line of credit to cover transactions that exceed the available balance.
-
Mobile Banking Services: Many financial institutions, including Stanford FCU, offer mobile apps that provide convenient and secure access to manage personal banking. These apps allow users to check balances, transfer funds, deposit checks remotely, and access various banking services from their smartphones.
-
Online Banking: In addition to mobile apps, online banking platforms offer a range of services similar to mobile apps, allowing customers to manage their accounts, pay bills, transfer funds, and access account information via web browsers.
Understanding these distinctions between account balances and available balances is vital for responsible financial management. Relying on available balances for spending decisions and leveraging tools like mobile banking can help individuals better control their finances and avoid overdrafts or other financial pitfalls.
FAQs
Your available balance is the total amount of money in your account that you can use for purchases and withdrawals, as it excludes pending transactions and check holds from your account balance. However, the available balance will not show checks that haven't been cashed or deposits which haven't posted.
What is the difference between my balance and my available balance? ›
Available balance is how much money you are able to spend right now, including any pending transactions. Meanwhile, the current balance shows how much money is in your account without subtracting pending payments or withdrawals. Current balance can be useful in some situations, like when doing your monthly budgeting.
What does available balance mean credit union? ›
The available balance is the current balance minus any holds, pledges, pending debits, certified drafts, etc.
Why is balance and available money different? ›
In a checking account, the available balance is the amount of money that the account holder can withdraw immediately. The current balance, by contrast, includes any pending transactions that have not yet been cleared. The bank will honor any withdrawal or payment you make up to the available balance amount.
What is the difference between available credit and account balance? ›
The primary difference between the current balance and available credit is that the current balance reflects the amount you currently owe, while the available credit represents how much credit you have left to use on your card.
Is available balance what I actually have? ›
Your available balance is the total amount of money in your account that you can use for purchases and withdrawals, as it excludes pending transactions and check holds from your account balance. However, the available balance will not show checks that haven't been cashed or deposits which haven't posted.
Does balance mean I owe money? ›
A current balance is the total amount of money you currently owe on your credit card. Meanwhile, a statement balance is made up of all the charges you made during the last billing cycle. This doesn't include any pending charges or purchases made after your billing cycle ended.
Can I withdraw money from available balance? ›
Available balance is that part of the current balance that can be accessed immediately by the account holder and is available for withdrawal. The account holder can use the available balance to make cash withdrawals, fund online purchases, and pay online bills.
Why can't I use my available balance? ›
This generally happens for two reasons, resulting in a low available balance: You've made deposits that haven't cleared and been credited to your account yet. There are pending withdrawals or authorizations against your account.
What does balance vs available mean? ›
'Balance' is the amount of money in your account before all pending transactions have been processed. 'Available' is the amount that you can spend today, and is a more accurate reflection of how much you can spend at that time.
The available balance for your account may differ from the current balance because of pending transactions that have been presented against the account, but have not yet been processed. Once processed, the transactions are reflected in the current balance and show in the account history.
Why is my account showing zero balance when I have money in my account? ›
Check for Pending Transactions: Look for any pending transactions that may be affecting your account balance. These could include pending deposits, withdrawals, or transfers. Sometimes, these transactions may take some time to reflect in your account balance.
What is the meaning of balance amount? ›
balance noun (MONEY)
the amount of money you have in a bank account, or the amount of something that you have left after you have spent or used up the rest: Once we know how much money we'll need, let's spend the balance.
Does available credit mean money you can spend? ›
Available credit is the amount of money that is available, given the current balance on the account. A credit limit is the total amount that can be borrowed. If all available credit has been used, then the credit limit has been reached, the account is maxed out, and the available credit is zero.
What is the difference between available and balance on a debit card? ›
Here's what they mean: 'Balance' shows how much money is actually in your account. 'Available' shows how much money you're allowed to use.
Do I pay available credit or current balance? ›
Paying either should be enough to avoid interest charges, but paying your full current balance when possible can help improve your credit utilization ratio and potentially your credit scores as a result.
Why is my balance higher than available balance? ›
The current balance listed in your account includes any transactions that are pending but have not yet cleared. As such, the current balance might be listed as higher than the available balance — in other words, the current balance can be an amount that's greater than what you're able to withdraw from the account.
Can you withdraw on available balance? ›
Available balance is that part of the current balance that can be accessed immediately by the account holder and is available for withdrawal. The account holder can use the available balance to make cash withdrawals, fund online purchases, and pay online bills.
