Difference Between Your Current and Available Balance
Tuesday, April 28, 2020
Read Time: 3 mins
Considering your checking account is the account you most likely pay your bills from, it's important to understand the difference between the two types of balances available when you check your account balance. Yes, you read that right, your checking account actually has two kinds of balances: the Current Balance and the Available Balance. You can view both balances when you review your account online, at an ATM, by phone, or at one of our locations. It’s possible for your Current and Available Balance to show different amounts. To help simplify things, we’ll explain how each balance works and the differences between your Current and Available Balance.
Current vs. Available Balance
What exactly is a Current Balance and an Available Balance? Is there a difference? Yes, there is a difference, and it could impact your account and potential fees.
- Current Balance: Current Balance is the total amount of money that you have in your account. Your Current Balance reflects transactions that have cleared your account, but it doesn’t include authorized transactions that are still pending. The Current Balance will change as transactions clear your account. Some purchases, charges, fees, or deposits that you make may not appear immediately and therefore, will not be included in your Current Balance.
- Available Balance: Available Balance is the amount of money in your account that is actually available for you to withdraw or spend. This balance is updated on a continuous basis and includes holds and pending transactions that have been authorized but haven’t cleared your account yet. Pending transactions include Debit Card charges and other transactions that haven’t been submitted by the merchant and therefore haven’t fully cleared your account. We use your Available Balance to determine if your account will overdraft, resulting in fees on your account.
Which balance should I use to determine if I have enough money to spend?
To determine if you have enough money in your account to cover a transaction, use your Available Balance. Since your Available Balance factors deposits, withdrawals, and all pending electronic transactions on your account, it provides a more accurate amount of how much you have available to spend.
Example of How an Overdraft Fee Could Occur
Let's say your Current and Available Balances are both $50, and you make a purchase online for $20. A hold is placed on your account, so your Available Balance is now only $30. Since the $20 transaction is pending, your Current Balance will still show $50. Before the online charge is sent to us for processing, a $40 automatic payment to your credit card company clears your account. Because you only have $30 available, your account will be overdrawn by $10, even though your Current Balance is $50.
How reliable is my Available Balance?
While your Available Balance is the most reliable balance to use when determining the amount you have available to spend, it's possible for you to overdraw your account even though the Available Balance appears to show you have enough funds. This is possible because your Available Balance may not reflect all outstanding transactions you've authorized but haven't cleared your account yet.
Examples of Transactions Not Reflected in Your Available Balance
- Outstanding Checks and Bill Payments: If you have written a check or set up automatic bill payments, those transactions won’t be reflected in your Available Balance until they clear (or become subtracted or added to your account). These transactions will be reflected in your Current and Available Balance when they clear your account.
- Debit Card Holds: When you use your Debit Card, the transaction may not immediately clear your account. The merchant sends us an amount (typically the purchase amount) for pre-authorization until the transaction actually clears your account. While the transaction is pending, it will be accounted for in your Available Balance. Holds typically stay on your account until the funds are transferred to the merchant. If you use your Debit Card and the purchase doesn’t post to your account within 72 hours, we must release the hold on the transaction. Once the hold is released, your Available Balance no longer includes this amount. Even though the hold is released after 72 hours, authorized purchases can still clear your account after that time resulting in a change in your Available Balance.
You can view your Current and Available Balance 24/7 using Online and Mobile Banking and Telephone Banking. It’s also a good idea to keep a running total of your balance by writing down your transactions or using an app or online tool to track your spending. By keeping track of your transactions as they occur, you’ll be more aware of how you're spending your money and it will be easier for you to discover an unauthorized charge if it ever occurs on your account. We also offer several Overdraft Services to help prevent your account from overdrawing and incurring fees.