Chpt 5 Banking Enter Lesson #4 Do Now

What services or options do you want in a bank? Banking services =

Banking options =

*Be prepared to share & discuss your answers with a partner. Time limit = 5 minutes

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Chpt 5 Banking Financial Services and Institutions

Comparing Financial Institutions

When you compare banks and other financial institutions, you should ask these questions to help choose the best one:

Where can you get the highest rate of interest on your savings?

Where can you obtain accounts with low or no fees?

Will you be able to borrow money from the institution when you need it?

Does it have online banking services?

Does it have convenient locations?

Is it FDIC insured?

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Finding a Financial Institution That ‘s Right for You Activity

Research one bank that might be good for you to open a savings and checking account with. You can find the answers and information for the worksheet on the bank’s website.

Carefully read the website for information on the banking services and options.

Write down the answers to the questions.

You will then share your finding with someone else and analyze which bank is better for your lifestyle and needs. (Compare & Contrast)

Why did you choose this bank to open a savings and checking account with?

Examples: TD Bank, Bank of America, Chase and PNC

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Account Verification The bank:

Reviews your credit & banking history.

Checks your photo identification.

Determines if you a responsible customer.

Signature card

Now you can deposit your money! 4

Opening & Maintaining Bank Accounts

Steps:

Open the account with a photo ID & SS card & go through account verification. (Individual or joint account)

Then you can make deposits & withdrawals.

Make sure to record any interest & fees.

Keep track of your account balance.

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Your Name Your Address

Your Phone Number

DEP

OS

IT

TIC

KET

DATE

DEPOSITS MAY NOT BE AVAILABLE FOR IMMEDIATE WITHDRAWAL

SIGN HERE IF CASH RECEIVED FROM DEPOSIT

YOUR FINANCIAL INSTITUTION

YOUR CITY, STATE Zip Code

DO NOT USE FOR AUTOMATIC PAYMENT OR CHECK TRANSACTIONS

:00000000 : 00000 00000.:

CURRENCY

COIN

CHECKS

OR TOTAL

FROM REVERSE

SUBTOTAL

LESS CASH RECEIVED

NET DEPOSIT

Check

Deposit (savings & checking)

A deposit is money you add to your account using a deposit slip, having your funds electronically transferred, or using an ATM.

Deposit Slip Activity

Take a saving & checking deposit slip & fill them out using the following information:

Savings Account Deposit Scenario You deposit $500 in cash plus a $40 check (#2603) from your grandparents as a birthday gift into your savings account. Checking Account Deposit Scenario You received your weekly paycheck of $224.70 and will deposit only $200.00 into your checking account. You want $24.70 back as cash to use for the week. Your employer’s check number is 5541.

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Balance The balance is the amount of money you have in your bank account. (saving or checking)

Withdrawal (saving or checking) A withdrawal is money you take out of your account using:

Checks – only checking

Withdrawal slips

ATMs

Debit cards

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Practice checking activity Bank of Monroe

Fee schedule for checking account

Monthly service fee:

This fee is waived if you keep a minimum daily balance of $500 – other than that it is $10 a month.

ATM transaction fee:

Bank of Monroe Free – Other banks $2.00 per transaction

Overdraft or insufficient funds fee:

$30 per item

Stop payment request fee:

$35 per item

Answer the following questions:

1. Last month, I used an ATM at Bank of Monroe 5 times. I also used another bank’s ATM twice. How much will Bank of Monroe charge me for using my ATM card last month?

2. Last week, Pat wrote a check for $200 to her friend but then lost it. She wanted to make sure no one cashed if, so she made a stop payment request. How much did Pat pay to request a stop payment of that check?

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Continued Practice checking exercises: Bank of Monroe

Fee schedule for checking account

Monthly service fee:

This fee is waived if you keep a minimum daily balance of $500 – other than that it is $10 a month.

ATM transaction fee:

Bank of Monroe Free – other banks $2.00 per transaction

Overdraft or insufficient funds fee:

$30 per item

Stop payment request fee:

$35 per item

Answer the following questions:

3. For the past 11 months, Sam kept at least $600 in his checking account every day. Last month, an emergency came up, and he had to withdraw $500, so he only had $100 left in his account. In the 12 month period, how much was Sam charged for his monthly service fee?

4. Renee wrote a check for $500 to pay her rent. She forgot that she only had $450 in her checking account. What is the name of the fee Renee will have to pay to Bank of Monroe?

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Chpt 5 Banking Exit Lesson #5 Do Now Withdrawal Slip Activity Take a saving & checking account withdrawal slip &

fill them out using the following information:

Saving Account Withdrawal Scenario You need to withdraw $325 out of your savings account for your vacation next week. Checking Account Withdrawal Scenario You need to withdraw $15.00 out of your checking account to pay for a Falcons shirt from the school store.

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Checking Account Info

Check Clearing Check clearing is a system that ensures that the money you deposited in the account is available for withdrawal. Check-clearing rules vary by bank, so ask your bank about its rules. Keeping Track of a Checking Account Each month your bank will send you a statement that shows your checking account activity for the month. Your bank statement will list:

Deposits Checks you have written ATM withdrawals Debit card charges Interest earned Fees

The balance reported on the bank statement may be different from the balance in your check register.

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Steps to writing a check Writing Checks

Before writing a check, use your check register to record the:

Date

Number of the check

Name of the party who will receive the payment

Exact amount of the check

Be sure to keep a current balance of the money you have by deducting from or adding to your balance the amount of any check transaction.

Steps in Writing a Check

Follow these steps when you write a check:

Write the current date.

Write the name of the party who will receive the check.

Record the amount of the payment in numerals.

Write the amount in words.

Sign the check.

Make a note of the reason for the payment.

Record it in your check book registry.

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Sample Check

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YOUR NAME YOUR ADDRESS

YOUR PHONE NUMBER

PAY TO THE

ORDER OF

105

00-6879

770

Dollars

FINANCIAL INSTITUTION Your City, State, Zip Code

:00000000 : 0000 0000 0 000 0 0.: Memo

$

Date: _______

1 3

B

6 4 5

C

2 A

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YOUR NAME YOUR ADDRESS

YOUR PHONE NUMBER

PAY TO THE

ORDER OF

105

00-6879

770

Dollars

FINANCIAL INSTITUTION Your City, State, Zip Code

:00000000 : 0000 0000 0 000 0 0.: Memo

$

Date: _______

YOUR NAME YOUR ADDRESS

YOUR PHONE NUMBER

PAY TO THE

ORDER OF

105

00-6879

770

Dollars

FINANCIAL INSTITUTION Your City, State, Zip Code

:00000000 : 0000 0000 0 000 0 0.: Memo

$

Date: _______ 2/26/20XX

Coffee Mart 19.75 Nineteen and 75/100

Your signature coffeemaker

Checking Account Services

Stop-Payment Order You may ask the bank to issue a stop-payment order if:

A check is lost or stolen. You want to take back your payment for a

business transaction. Fees for this service can range from $10 to $20 or more. Making Deposits To add money to your checking account:

Fill out a deposit ticket. Endorse the back of each check you want

to deposit. Here are some tips to follow when endorsing a check:

Do not endorse a check until you are ready to cash or deposit it.

Use a pen so that your signature cannot be erased.

If depositing a check by mail, write “For deposit only” above your signature.

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stop-payment

order

a request that a

bank or other

financial

institution not

cash a particular

check

endorsement

the signature of the

payee, the party to

whom the check

has been written

Back of the Check ENDORSE HERE

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DO NOT WRITE, STAMP OR SIGN BELOW THIS LINE RESERVED FOR FINANCIAL INSTITUTION USE *

Checking Account Statement A record of all transactions made during the preceding month, including: • Cashed checks • All withdrawals and deposits • Debit card purchases • Fees

Checking Info

Reconciliation You can fill out a bank reconciliation form to determine your true balance. To balance, or reconcile, your account, follow these steps:

Compare the checks you have written during the month with those that are listed on the bank statement as paid, or cleared.

Determine whether any recent deposits are not on the bank statement.

Subtract fees and charges listed on the statement from your checkbook balance.

Add interest earned to your checkbook balance.

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bank

reconciliation

a report that

accounts for the

differences

between the

bank statement

and a checkbook

balance

Checking Account Reconciliation Form

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CHECKS OUTSTANDING - NOT CHARGED TO ACCOUNT

$

Check Number

Check Amount

$

Total

$

$

$

$

Balance

$

* This balance should agree with balance in your check register.

Total

$

Bank balance shown on this statement

Subtract withdrawals outstanding

Add deposits outstanding

Keeping an Accurate Record of Checking Account Activity

Record all transactions.

Record maintenance fees, interest, and other bank charges.

Review the monthly checking account statement.

Reconcile your check register with your monthly checking account statement.

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Consequences & “Bad” or NSF Check (Not sufficient funds)

Negative activity reported Bank closes your account Civil and/or criminal prosecution Merchants may not accept your checks Your credit may be impacted A check you write when there isn’t enough

money in your checking account to cover it. Bad check fees

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Think about what you have learned, how can you manage your money:

Deposit money into a checking account =

Have funds taken out of a checking account =

Deposit money into a savings account =

Withdraw money from a savings account =

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Chpt 5 Banking Lesson #5 Exit Ticket Do Now