Hold down the string at the 16th fret
Acoustic Guitars
Place a capo on the 2nd fret and hold the string down at the 14th fret. At the 6th fret you should be able to slide a business card in the gap between the string and the fret with little resistance.
Place a capo on the 2nd fret
At the 8th fret you should be able to slide a plastic bill in the gap between the string and the fret with little resistance
String Clearance Truss Rod Check
String clearance is the distance between the strings and the frets. Checking the string clearance will verify if your truss rod is adjusted properly and can tell you if your neck has moved due to seasonal changes in humidity. Checking both the outer strings can also reveal if your neck may have a slight twist.
This simple check for proper string clearance works for electric or acoustic guitars but the process is slightly different for each. Acoustic guitar check is at the bottom of the page.
String clearance is just one step in setting up a guitar and is NOT the proper way to set the action on a guitar.
Electric Guitars
Place the guitar on a flat surface. Do not place anything under the neck that could interfere. If you have to support the neck, place the support closer to the body rather than the headstock.
That's all there is to it. Now you can adjust the clearance to your own preference.