NEW YORK (CNN/Money) - The Check Clearing for the 21st Century Act, otherwise known as the "Check 21" law, went into effect Thursday.

While the reforms won't happen overnight, the new law enables banks to transmit images of checks of electronically -- speeding up the banking process.

Consumer advocates are critical of the law, saying it will cause problems for consumers. What do you need to know about Check 21? Here are 5 Tips.

With the adoption of Check 21, checks could clear in 24 hours rather than days. That slashes the "float."

Historically, the "float" has been the one- to five-day window between the time you write a check and the time money is withdrawn from your account. For years, paper checks have been transported by planes, trains and trucks for processing -- which took time.

People often took advantage this time lag to give themselves some flexibility with their finances. (For instance, consumers could send their rent checks to their landlord by the first of the month, but the check wouldn't actually clear until their paycheck cleared on the third.)

Bottom line: if you were in the habit of taking advantage of the float, you better change your check-writing ways. Check 21 is expected to effectively sink the float.

Now that the float will be virtually extinct (or at the very least cut way down), check writers need to be extra careful about bouncing checks. Consumer advocates say they'll be happening much more frequently.

What to do about the problem? For one thing, don't write a check unless the funds are already in your account. (Sounds simple enough, right?)

Balance your checkbook so you know exactly how much money you have. According to Jean Ann Fox at the Consumer Federation of America, only 1 in 8 people do.

CNNfn's Gerri Willis shares five tips on what you need to know about the new 'Check 21' law. Play video (Real or Windows Media)

You'll need to stay on top of which checks have cleared your account and when. You'll also need to be aware of when checks made out to you have been processed.

Ironically, according to Consumers Union, the checks you write will clear faster, but banks aren't required to speed up the time when they make funds available from the checks that you deposit. For that reason, you may want to sign up for direct deposit with your employer if you haven't already.

If you're worried about fees piling up from bounced checks, you may feel inclined to sign up for a bounce protection plans or seek out banks offering courtesy bounce protection.

But consumer advocates say these are nothing but high cost loans, and consumers need to understand just how expensive they are. Advocates also say these loans are unfair because consumers don't always know they're being lent money.

Here's how it happens: You go to a store and use your debit card to buy a $30 sweater. The transaction is processed normally, even though you didn't have enough money in your account to cover the purchase because of bounce protection.

Sounds convenient right? Well, it's going to cost you. Fees for this kind of protection range from $20 to $35 per loan. Some banks also charge an additional $2 to $5 a day until the loan is repaid.

According to the Consumer Federation of America, if the cost of a $100 overdraft is $20, that translates to an APR of 520 percent if the bounce loan isn't paid off for 14 days.

While Check 21 won't change the way consumers write checks, it will likely change the way they account for them.

According to the American Bankers Association, 23 percent of Americans aged 18 to 34 and 50 percent of Americans aged 55 and up get their original checks back in the mail.

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While the banking industry won't suddenly convert to an electronic system overnight on October 28th, Check 21 will put an end to this process at some point.

For people accustomed to receiving their original cancelled checks in the mail, this will eventually require a personal adjustment. The ABA says customers will still have proof of payments in the form of check images or "substitute checks" which are paper copies of original checks (front and back) with all endorsements.

Tracking your account online is probably the easiest way to stay up to date on your finances. Most banks allow you to view your account online for free. That way you can check your balance, see when your checks clear and see your recent transactions.

However, if you want to pay bills online you may have to pay a fee. We found big banks like Citibank and Bank of America offer free online bill paying.

If you're not sure about your bank's policy regarding online banking, read the fine print to find out about any costs.

Paying a small monthly fee for the service may be worth it if you think you might be at risk for bouncing checks. Bank of America says consumer account summaries update almost instantaneously following deposits, withdrawals and debit transactions. (Checking activity shows up as soon as checks are processed).

If you're not sure how frequently your bank updates online account summaries, call them to find out so you know how current your online account information is.

Gerri Willis is a personal finance editor for CNN Business News. Willis also hosts CNNfn's Open House, weekdays from Noon to 12:30 p.m. (ET). E-mail comments to 5tips@cnn.com.