• Activity 1…….Where Do I Keep My Money?

• Activity 2…….Evaluating Financial Services

• Activity 3…….Banks, Yesterday and Today

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ACTIVITY 1

Where Do I Keep My Money?

Overview

• The functions of banks

• The cost of alternative financial services

• The stability of banks

Introduction to Financial Services - Activity 12www.StudsPlanet.com

PLACES TO SAVE MONEY

Would you save your money in any of these places? Why? Why not? Can you think of other places to save money?

• Bed & Mattress• Cookie Jar• Pillow• Wallet• Money Belt• Small House Safe

Slide 1 - Places to Save MoneyLesson Reference: Introduction to Financial Services, Activity 2 – Overhead 13

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Slide 2 - Alternative Financial Services Lesson Reference: Introduction to Financial Services, Activity 1 – Handout 1

ALTERNATIVE FINANCIAL SERVICES

•Check-Cashing Services

•Check-Deferrals, Cash Advances, Payday Loans

•Pawn Shops

•Rapid Tax Refunds

•Rent-to-Own

•Other Financial Services

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FEDERAL DEPOSIT INSURANCECORPORATION (FDIC)

• Established in 1933.• Insures most Savings, Checking,

and other Deposit Accounts,up to $100,000 per depositor,per institution.

• Applies to most CommercialBanks, Savings Banks, andSavings Associations.

Slide 3 – FDIC Lesson Reference: Introduction to Financial Services, Activity 1 – Overhead 25

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Overview

• Formal and informal financial services• Costs of alternative financial services and

average bank accounts • Advantages of establishing a banking

relationship

ACTIVITY 2

Evaluating Financial Services

Introduction to Financial Services – Activity 26www.StudsPlanet.com

Slide 1 – Formal and Informal Financial Services Lesson Reference: Introduction to Financial Services, Activity 2 – Overhead 1

INFORMAL FINANCIALSERVICES

• Payday lenders• Check cashing services• Rent-to-own stores• Pawn shops• Title lenders• Loans from family/friends• Cultural savings clubs• Remittances offered through

nonfinancial institutions

FORMALFINANCIAL SERVICES

• Accounts• Credit cards• Loans• Investment vehicles• Direct deposit• Wire transfers/ remittances

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Slide 2 – How a Bank Can Save You Money Lesson Reference: Introduction to Financial Services, Activity 2 – Handout 2

HOW A BANK CAN SAVE YOU MONEY

Monthly Fees without a Bank Monthly Fees with a Bank*

8

• $80 to cash paychecks• $3.81 on money orders and

stamps to pay bills• $15 to send money to family

with a wire transfer company

Monthly cost: $98.81 Annual cost: $1,185.72

• $0 to directly deposit

paycheck• $0 to get cash from bank's

ATMs or make debit card purchase

• $0 to pay monthly bills using electronic bill payment

• $5 to send money to family

Monthly cost: $5.00 Annual cost: $60.00Annual Savings by Using a Bank: $1,125.72

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Slide 3 – Advantages of a Banking Relationship Lesson Reference: Introduction to Financial Services, Activity 2 – Overhead 2

ADVANTAGES OF ESTABLISHING A BANKING RELATIONSHIP

Nearly everyone needs a bank account to help manage his or her day-to-day money.

Bank accounts can help you to:• Pay bills• Manage your money• Receive money• Send money to a friend or family member• Keep your money secure• Start building wealth• Earn interest

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ACTIVITY 3

Banks, Yesterdayand Today

Overview

Introduction to Financial Services - Activity 3

• The many traditional financial services provided by a bank

• Other expanded financial services provided by a bank

• The impact of banks throughout the community

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TRADITIONALSERVICESOF BANKS

• Checking Accounts• Savings Accounts• CDs (Certificates of

Deposit)• Savings Bonds• Loans

• Car• Home• Personal

• Safe Deposit BoxesSlide 1 - Traditional Services of Banks

Lesson Reference: Introduction to Financial Services, Activity 3 – Overhead 1 11www.StudsPlanet.com

EXPANDEDSERVICESOF BANKS

• Insurance Sales• Small Business

Advising and Loans• Investments• Credit Cards• Remittances

Slide 2 - Expanded Services of Banks Lesson Reference: Introduction to Financial Services, Activity 3 – Overhead 2

TRADITIONALSERVICESOF BANKS

• Checking Accounts• Savings Accounts• CDs (Certificates of

Deposit)• Savings Bonds• Loans

• Car• Home• Personal

• Safe Deposit Boxes12

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FINANCIAL SERVICESMODERNIZATION ACT (1999)

Transformed the banking industry. Eliminated many

restrictions among companies in the securities, banking, and insurance industries.

Results?• Banks may offer some insurance and

investment services.

• Investment and insurance companies may offer some traditional banking services. Investments are not insured by FDIC.Slide 3 - Financial Services Modernization Act

Lesson Reference: Introduction to Financial Services, Activity 3 – Overhead 3 13www.StudsPlanet.com

SOME COMMUNITY-RELATEDSERVICES OF BANKS

• Bank employees mentor students in areas of basic financial skills.

• Bank employees serve on community organizations’ boards of directors.

• Banks provide scholarships to students going into the banking profession.

• Banks fund affordable housing construction.

Slide 4 - Some Community-Related Services Lesson Reference: Introduction to Financial Services, Activity 3 – Overhead 4 14

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