Personal bank reconciliation software, for a trustee, executor or family caregiver, has one job: prove every month that the account you manage for someone else agrees with your records, line by line. It should keep their money separate from yours, tie each receipt and payment to a document, and produce balances a court or beneficiary can check.
Who needs personal bank reconciliation software for someone else's money?
Anyone who manages money that belongs to another person, and may have to explain it later, needs a reliable monthly reconciliation. That includes trustees of a living trust, executors of an estate, agents under a power of attorney, court-appointed guardians or conservators, and people managing government benefits for someone else.
The roles and who checks them
The Consumer Financial Protection Bureau publishes its "Managing Someone Else's Money" guides for four of these roles: agents under a power of attorney, court-appointed guardians of property, trustees of revocable living trusts, and government-appointed fiduciaries who manage benefits. Each role answers to someone. A court may require a formal accounting. A trust may name beneficiaries who can ask for records. A benefits agency may ask how payments were spent.
Why a budgeting app is not enough
Budgeting apps categorize spending for the owner of the money. A fiduciary needs something different: proof that the bank statement balance, adjusted for items not yet cleared, equals the record of receipts and payments, and that every payment has a reason. Software helps when it keeps that record month after month without gaps. A spreadsheet can do the same if it is kept faithfully.
Keeping the person's money separate in a personal bank reconciliation
Keeping money separate means the person's funds sit in an account titled in their name, or in the trust's name, and nothing of yours goes in or comes out of it. A reconciliation only proves something if the account holds one person's money. Once funds are mixed, the statement can no longer show whose money paid for what.
What the CFPB trustee guide says
The CFPB's guide for trustees under a revocable living trust lists keeping trust property separate and keeping good records among a trustee's core duties. It says never to deposit the trust's money into your own or anyone else's account. It also warns that paying expenses with your own money and then paying yourself back makes good records hard to keep. If you must do it, the guide says to keep receipts and a record of why, what and when you repaid yourself.
What separation looks like on the statement
On a properly separated account, every deposit has a source you can name, such as a pension, a benefit payment, a dividend or a house sale. Every payment goes to a bill, a care provider or a documented reimbursement. A transfer to your own account with no matching receipt is the line a court or beneficiary will ask about first.
What does a court or beneficiary accounting need from your bank records?
A court or beneficiary accounting usually needs the starting balance, every receipt, every payment, and the ending balance for the period, all tied to the bank statements. The reconciliation is what proves those figures. If the bank statement and your list of receipts and payments do not agree, the accounting is not ready to file.
A monthly step list
- Download the statement for the month and save it with the account name and month.
- Check that it foots. The opening balance plus deposits, minus withdrawals, must equal the closing balance printed on the statement.
- Check continuity. This month's opening balance must equal last month's closing balance. The test is explained in bank statement continuity: does each closing balance carry forward.
- Tick each line against your record of receipts and payments, and attach or reference a document for each.
- List what has not cleared, such as a check you wrote that the payee has not cashed.
- Write a note for anything unusual, and keep it with the statement.
An example month
The example below uses invented figures for a parent's account managed by an adult child under a power of attorney.
| Item | Amount |
|---|---|
| Opening balance, 1 May | 6,240.00 |
| Pension and benefit deposits | 3,180.00 |
| Care home fee | (2,900.00) |
| Pharmacy and utilities | (412.35) |
| Reimbursement to agent, receipts on file | (86.40) |
| Closing balance per statement, 31 May | 6,021.25 |
| Less: check 214 to dentist, not yet cashed | (150.00) |
| Balance per your records | 5,871.25 |
The reimbursement line is the one to support carefully, with the original receipts and a note of what was bought. Unexplained items like this are exceptions to follow up, and the post on reconciliation exception management from flag to close explains how to track each one until it is resolved.
Fiduciary reconciliation mistakes with cash and reimbursements
The mistakes that most often leave a fiduciary's account unexplained involve cash, reimbursements and accounts nobody remembered. Each one breaks the link between the bank statement and the record of what the money was for.
The common mistakes
- ATM withdrawals. Cash leaves no payee on the statement. If cash is unavoidable, keep receipts for how each withdrawal was spent.
- Lump-sum reimbursements. Repaying yourself a round figure at the end of the month, with no receipts, looks like a withdrawal for yourself.
- Forgotten accounts. A small savings account or a credit union share account the person opened years ago still needs reconciling. A credit union's own internal reconciliation is a different job, covered in reconciliation software for credit unions; your task is the member statement.
- Catching up at the end. Reconciling a year of statements when the court asks is far harder than doing one each month.
What software adds
A tool that checks each statement foots and lists duplicates and gaps saves time, and shows the checks bank reconciliation software should run on every statement. PreciseBankFlow is built for CPA and audit firms, so a fiduciary is more likely to meet it through the accountant who prepares the court accounting than to use it directly. The checks are described on the PreciseBankFlow homepage.