Bank Statement: Definition, How It Works, and Key Details
A bank statement is a record provided by a financial institution that summarizes an account’s activity and balances for a specific period. It helps account holders monitor deposits, withdrawals, fees, interest, and other transactions.
What a Bank Statement Shows
- Beginning and ending balances for the statement period
- Chronological list of transactions: deposits, withdrawals, checks paid, transfers, and card transactions
- Fees and service charges
- Interest earned (if applicable)
- Bank contact information and the statement closing date
Example: For Sept. 1–30, a statement might show a beginning balance of $1,050, total deposits of $3,000, total withdrawals of $1,950, service charges of $0, and an ending balance of $2,100.
Explore More Resources
How It Works
- Issued monthly or quarterly, in paper or electronic form.
- Banks send statements after the period closing date; the cycle date can change at the bank’s discretion.
- Electronic fund transfers (ATM/debit, online bill pay, direct deposits, recurring debits) generally trigger the requirement for a statement.
- Banks must keep records of deposits over $100 for a period required by regulations (often five years).
Types of Statements
- Paper statements: Mailed copies that may incur a per-statement fee to cover printing and postage. Fees and exemptions vary by institution.
- Electronic statements: Available online or emailed as PDF attachments. Typically free, and opting in can sometimes waive account maintenance fees. ATMs and online banking may offer transaction histories or printable copies.
Why Regular Review Matters
- Track spending and budget effectively.
- Detect and report fraud, duplicate or mistaken charges, and bookkeeping errors.
- Reconcile personal records (e.g., check register) with bank records.
- Dispute timelines vary; report discrepancies promptly (some disputes must be raised within about 30 days).
- Retain statements for at least one year, and longer for tax or legal purposes as needed.
Key Components (Checklist)
- Bank name and contact details
- Account name and number (often partially masked)
- Statement period and closing date
- Beginning and ending balances
- Itemized transactions with dates, amounts, and payees
- Fees and interest earned
Official Bank Statement vs. Transaction History
- Bank statement: Covers a fixed statement period (typically a month) and is the formal record issued by the bank.
- Transaction history: Can be generated for a user-selected time frame and may include more recent or pending activity not yet on a formal statement.
Privacy and Access
Banks do not disclose your bank statement to third parties without your consent. Only authorized persons or those with legal access (e.g., power of attorney) can review your statements.
How to Get Your Statements
- Log in to your bank’s website or mobile app to view, download, or print e-statements.
- Request mailed paper statements from your bank if you prefer a physical copy.
Bottom Line
Bank statements are essential for tracking finances, spotting errors or fraud, and reconciling accounts. Opt for e-statements to reduce costs and access records quickly, but review statements regularly and report discrepancies promptly.