A canceled check is a check that has already drawn funds on the designated account. In your bank statement you may receive either your original canceled checks showing that these checks have been paid, or you may receive copies of each canceled check. Usually the institution from which the money is drawn, a bank, stamps the canceled check to indicate funds guaranteed on the check have been given to the person or institution that received the check.

Should you ever need to prove you’ve made a payment, you can use a canceled check as a receipt. From time to time, human error means a payment you make is not recorded, especially to other banks, credit card companies or various utility companies. By showing your canceled check to any institution that questions whether you made a payment, you essentially prove you have. Usually you should hold onto any canceled check to such an agency until your next bill shows a record of your payment.

You can use your canceled checks to prove business expenses. Yet it’s also a good idea to hold onto original records or receipts of business transactions. A canceled check doesn’t really tell you what you made a payment for, only that you made a payment. This may not be sufficient evidence if you need to justify business expenses to the company you work for, or to tax agencies like the Internal Revenue Service (IRS).

Some people will hold onto their canceled checks for years, which is largely unnecessary. Usually once you’ve verified that someone has received your payment, you can get rid of the check. This does not mean you should simply throw out the check in the garbage. Though someone else usually can’t use the check itself again, the check contains information that could be used to access your bank account.

For instance, on canceled checks you’ll still be able to see the routing number of your bank and your bank account number. You check may also reveal other personal information about you, like your address, telephone number and even your driver’s license. Generally, it’s a good idea not to include driver’s license numbers on checks, and to only include address and phone number. You may not even need to include a phone number, though some companies may require it on a check. You can write the phone number in and initial it if needed.

The main trouble with a canceled check is the routing number and bank account. More and more, people are able to make payments or purchase things on the Internet with this information only, especially if they also have your full name. It therefore makes sense to shred canceled checks once you no longer need them, so no one can gain access to valuable information about your bank account.