BANKING SERVICESActivities involved in accepting and safeguarding money owned by individuals and companies and lending it to earn a profit.

Savings accounts

Savings account- interest is paid quarterly at a current rate.

Christmas club- special fund to save money for Christmas. Account is closed at the end of November.

Savings Account

Certificate of deposit- invest money for a specific time period of 182 days to five years. Interest rates are higher but there is a penalty if with drawn early.

Vacation account- place money in the account special for a vacation.

Savings Account

Money market deposit- benefits are you can write checks, transfer funds by phone, higher variable rates

Roth account- you add to this account until you retire. AT the time of retirement, you do not have to pay any taxes on it. You do pay taxes at this time. You will receive interest on your account.

Checking Account

Now account- this is an account that you will get interest on your money within the account. You must retain a certain amount to receive the interest

ATM card Direct deposit Free first check kit

Regular checking- this is an account that you use if you can not keep a minimum amount in an account. You write checks.

ATM card Direct deposit Free first checks kit

Loan Types

Mortgage- purchase a home. Fixed or adjustable rates.

Home Improvement Loan- money for home additions, repairs, energy saving improvements, and other remodeling

Loan Types

Construction Loans- get money to build a home or building and then it turns into a permanent loan (mortgage).

Automobile Loan- loan for a purchase of a car, truck or van

Loan Types

Investment Property- this is money for non-owner occupied residential properties.

Personal Loans- loan for vacations, college, or any other purpose. You must qualify.

Other Financial Services

Travelers checks- checks worth certain amounts

Money orders- amount sent to a company Credit card- pay at end of month Debit cards- money is subtracted immediately

from account Safe deposit boxes- keep valuables there Cash advance Overdraft protection- you will not be billed if a

check is written that you can not cover

Questions to answer

What would be two advantages of having a Christmas savings account over just a regular savings account? (2 point question)

Why is it better for a person thinking about retirement to have a Roth account? Site two for each. (2 point question)

For a person right out of high school, which types of banking services would be the best to have and explain your reasoning. List two services. (4 point question)

Questions to answer

You have a friend that said they saw no reason to put their money into a savings account since the interest rate is so low. Explain why this is not true. (2 point question)

Questions to answer

If a friend needed money for the following, what type of account / loan would you suggest?

1. college Vacation Gifts for Christmas Repair your car Add a room onto your house

Tips for writing checks

Write with dark ink Start at the left on all lines Write clearly and spell correctly Don’t sign the check until you have filled

it in completely Sign a check exactly as it appears on

your account Write a memo for you on the blank to

remind you of what the check was for

Tips for writing a check

If you make a mistake, write the word “Void” on the check and start a new one

Always date the check To deposit a check, write your full name

in ink on the back Do not sign a the back of a check until

you are at the bank

Check Register

Record all deposits Record all uses of the ATM card Keep record of all checks that you write Balance your checking account at the

end of each month

Complete check and deposit slip in class

Activity