Current Balance vs. Available Balance: What’s the Difference?

You’re probably used to logging into your bank’s website and seeing your checking account balance prominently displayed. But if you look a little closer, you may see two balances listed — the current balance (how much you have in the bank) and the available balance (what you can actually spend) — and they don’t always match.

These terms are similar, which can be confusing. Mixing up the two may lead to overdrafts and fees if you aren’t paying attention. Keeping your current balance and available balance straight can take a little practice, so keep reading to learn the difference and how to avoid overspending.

Key takeaways

• Your current balance is the total amount of money in your checking account but does not include pending transactions.
• Your available balance reflects pending transactions and is the amount you can spend without overdrawing your account.
• Understanding how both balances work can help you avoid overspending and overdraft fees.

Available balance explained

Your available balance is the amount of money in your account right now. It is your current balance minus any pending credits or debits, and it is the money you can safely spend or withdraw without incurring overdraft fees. You should use this balance to determine if you have enough in your account to cover a purchase.

While each banking platform and website is different, many checking accounts will immediately show you your available balance when you log on to the website or mobile app. For example, I can see the available balance of my checking account as soon as I log in to my bank’s website, but I have to click on the account to see pending transactions and other details. Your available balance is likely also listed on any ATM or bank teller receipts you receive from your bank.

Current balance explained

Your current balance, sometimes called your present balance, is the money in your account, including all deposits and debits posted up to that date. It does not include unposted debits or credit transactions, so your current balance is often different (and sometimes higher) than your available balance.

Since transactions can take a couple of days to post, your current balance is often less accurate than your available balance. Many banks show your current balance within the account details or under your available balance, but you may need to search for it.

What can cause the difference?

While your available and current balances may be the same if you haven't had any recent transactions, the two balances are often different. The reason for the difference is usually the amount of time it takes for a pending charge or deposit to clear your account.

The following transactions may take some time to post to your account.

• Pending debit card purchases
• Pending refunds from merchants
• Authorization holds, such as at gas stations, hotels, car rental companies, and some online retailers.
• Deposited checks
• Pending direct deposits
• Pending account transfers
• Pending automatic withdrawals for bills or to other accounts

For example, let's say you start the day with a current and available balance of $1,000 in your checking account. Then, you spend $100 at the grocery store using your debit card.

If you immediately log into your bank account’s app or website after visiting the grocery store, your available balance will likely be $900. However, your current balance would likely still show as $1,000 because the $100 hasn’t officially been posted to your account yet.

Pending transactions can take up to three days to post to your account. However, banks must make a direct deposit available within one business day of receiving the funds.

Paper checks can take additional time to clear. Typically, the first $200 of the deposit is available within one business day, but the remaining balance can take an additional day to appear in your account. A longer delay may occur if you’ve recently opened a new account, have frequent overdrafts, or made a large deposit.

Before opening a new account, read and understand your bank’s transaction processing policies and timelines so you know what to expect.

Which balance should you use?

In general, checking your available balance is the best way to know exactly how much is in your account at any given moment. Doing so can also help you avoid a cash crunch and prevent account overdrafts and fees.

However, you still need to keep track of any upcoming transactions, such as automatic withdrawals and transfers, electronic bill payments, undeposited paper checks, or delayed debit card purchases because they may not be included in your available balance.

Your current balance can help you understand how much money is in your account overall, which may be helpful for budgeting. While you probably shouldn’t rely on your current balance alone to know how much is in your account, using it along with your available balance can help you get a general feel of what is going in and out of your account during the month.

Consider overdraft protection

Regardless of which balance you check, the ultimate goal is to avoid overdrafts on your account. While keeping a cash cushion in your checking account is a good idea, it can take time to build, especially if you live paycheck to paycheck.

If you overdraw your account, the bank may decline the transaction and charge you a non-sufficient funds fee (NSF). Consider enrolling in your bank's overdraft protection program to help you avoid incurring those charges.

Overdraft protection can help ensure that some transactions go through even if your available balance isn’t large enough to cover them. Then, you won't have to worry about potentially delayed deposits or other problems causing you to overdraft.

However, overdraft protection often comes with fees, although they may be less than multiple NSF fees or merchant fees for a declined transaction. Some banks don’t charge for overdraft protection up to a certain amount. If you’re looking for a new bank, check the financial institution’s policy on overdrafts and insufficient fund fees in the account disclosures before signing up.

FAQ

Bottom line

Knowing the difference between your current and available balance is essential to managing your finances. When in doubt, check your available balance to know what you can spend, but keep an eye out for future automatic payments or other transactions that could cause your account to overdraft.

Bank apps, text alerts, and websites can be helpful ways to monitor your finances in real time and help you avoid expensive fees. Learn about the best checking accounts to see how they stack up against your current bank’s offerings.