Ledger Balance Meaning: Your Guide to Ledger Balance

In this article, we’re taking a look at ledger balance meaning, availability, and comparison to other balances.

We will also be answering important questions that we receive from our members on this topic below.

This article is part of our series on banking basics, ranging from opening different types of bank accounts around the world to understanding how various aspects of the banking system operate.

Feel free to use the table of contents to jump ahead to the sections most relevant to you.

Table of Contents

  1. Ledger Balance Meaning
  2. Frequently Asked Questions
  3. Do You Want Help Opening Bank Accounts?

Ledger Balance Meaning

Ledger balance, meaning the closing balance at the end of each day, accounts for all transaction activity in a 24-hour period in banking. This includes each credit, debit, interest, and fee. The ledger balance then becomes the opening balance of the account the following day.

Additionally, an account statement includes a column for transaction information, credit, debit, and chequing or savings account balance after each transaction. The account balance column reflects the changes in the ledger balance throughout the day.

What Is the Rule for Ledger Balance?

The rule for calculating a ledger balance is that the ledger balance is equal to the opening balance plus all debits within a 24 hour period less all credits within a 24 hour period. The resulting number is the ledger balance.

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Frequently Asked Questions

Below are a few of the most common questions we receive from people looking into the meaning of a ledger balance. If you have further questions you would like to ask our team, don’t hesitate to get in touch.

Can I Spend My Ledger Balance?

Yes, ledger balance refers to money that can be spent. However, it is important to point out that the ledger balance may not take into consideration deposit holds like those that can be placed on checks after they are deposited. Therefore, it is possible that the ledger balance is not a clear reflection of the total funds available to you spend. However, the ledger balance does generally refer to the amount of money in your account available for spending.

Why Is the Ledger Balance Lower Than My Accessible Balance?

The main difference between accessible balance and ledger balance is that accessible balance is an exact reflection of the funds that you can spend immediately while ledger balance is a reflection of the funds that you will have in your account after all checks and other financial transactions have cleared.

What Is the Difference Between Available Balance and Ledger Balance?

The main difference between available balance and ledger balance is that available balance is an exact reflection of the funds that you can spend immediately while ledger balance is a reflection of the funds that you will have in your account after all checks and other financial transactions have cleared.

How Long Does It Take Ledger Balance to Be Available?

How long it takes for a ledger balance to be fully available will depend on the specific hold on the account and the policies of the bank. That said, in most cases, checks clear within a few days of being deposited, therefore if you are waiting for a check the ledger balance should be available a few days after the deposit was made.

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GlobalBanks Team
GlobalBanks Team

The GlobalBanks editorial team comprises a group of subject-matter experts from across the banking world, including former bankers, analysts, investors, and entrepreneurs. All have in-depth knowledge and experience in various aspects of international banking. In particular, they have expertise in banking for foreigners, non-residents, and both foreign and offshore companies.

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