When you look at your bank account balance, you may be wondering what the difference between the “available balance” and the “current balance” is. The available balance is the amount of money that is currently available to spend or withdraw, while the current balance includes all of the transactions that have been made since your last statement. This can include deposits, withdrawals, fees, and interest. So if you had a $100 deposit and then withdrew $50, your current balance would show as $0 but your available balance would still be $50. Hopefully, this explanation makes sense and helps clears up any confusion about your bank account balances!
What is the Available Balance?
Available balance is the portion of your account balance that is available to you at any given time.
- This amount includes any deposits that have been made and any credit that may be available to you, minus any outstanding checks or debit card transactions.
- Available balance is also sometimes referred to as “current balance.” To find your available balance, simply look at your most recent account statement or check your bank’s online portal.
- Available balance is an important metric to keep track of, as it can help you avoid overdraft fees and other penalties. By knowing your available balance, you can ensure that you always have enough money to cover your expenses.
What is the Current Balance?
The Current Balance is the amount of money in an account at a given moment. This can be calculated by adding up all deposits and subtracting all withdrawals from the account.
- The Current Balance is important because it determines how much money is available to be withdrawn or used. For example, if someone has a Current Balance of $100 and they withdraw $50, then their new Current Balance will be $50.
- Current Balances can also be negative, which happens when there are more withdrawals than deposits. In this case, the account holder may owe money to the bank or other institution.
- Regardless of whether the Current Balance is positive or negative, it is always important to keep track of it so that you know how much money is available to use.
Difference between Available Balance and Current Balance
Available balance and current balance are two concepts that are often used interchangeably, but they actually refer to different things.
- Your available balance is the amount of money in your account that is available to you at a given moment.
- This includes funds that have been deposited as well as any funds that have been cleared for withdrawal.
- Your current balance, on the other hand, is the total amount of money in your account, including both Available and Pending funds.
- Pending funds are typically items that have been deposited but have not yet cleared, such as checks or electronic transfers.
As a result, your current balance will always be higher than your available balance. It’s important to keep track of both balances to avoid overdrawing your account.
Conclusion
So what’s the difference between your available balance and current balance? Available funds are those that are immediately available to you, while your current balance reflects all of the transactions that have taken place – both deposits and withdrawals. Understanding this distinction is important for two reasons. First, it can help you stay on top of your finances by knowing how much money is actually accessible to you at any given time. Second, if you’re trying to make a large purchase or transfer money, understanding the available balance will tell you exactly how much room you have in your account.
