Copyright © Texas Education Agency, 2012. All rights reserved. Banking Options Copyright © Texas Education Agency, 2012. All rights reserved.

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Copyright © Texas Education Agency, 2012. All rights reserved. Need to Know Terms Bank Credit Union Checking Account Savings Account Bank Loan Principal Interest Online Banking Online Bill Pay Customer Service Rep Deposit Slip Overdraft Overdraft Protection Copyright © Texas Education Agency, 2012. All rights reserved.

Copyright © Texas Education Agency, 2012. All rights reserved. Bank A bank is an institution, chartered by the state or federal government that takes deposits and provides credit and other financial services. Credit Union A credit union is nonprofit-making money cooperative whose members can borrow from pooled deposits at low interest rates. Checking Account - an account which allows the holder to write checks [or use debit card] against deposited funds. Savings Account - a deposit account at a bank or savings and loan which pays interest, but cannot be withdrawn by check writing. Copyright © Texas Education Agency, 2012. All rights reserved.

Copyright © Texas Education Agency, 2012. All rights reserved. Bank Loan - a loan consisting of a principal and interest payments, which is provided by a banking institution to a borrower. Principal - the amount borrowed or the part of the amount borrowed which remains unpaid. Interest- the fee charged by a lender to a borrower for the use of borrowed money, usually expressed as an annual percentage of the principal. Copyright © Texas Education Agency, 2012. All rights reserved.

Copyright © Texas Education Agency, 2012. All rights reserved. Online Banking - a system allowing individuals to perform banking activities at home, via the internet. Online Bill Pay - allows customers to conduct financial transactions. Customer Service Representative A customer service representative is an individual from the bank or credit union that performs business services for their customers. Deposit Slip A deposit slip is an itemized slip showing the exact amount of paper money, coins, and checks being deposited to a particular account. Copyright © Texas Education Agency, 2012. All rights reserved.

Copyright © Texas Education Agency, 2012. All rights reserved. Overdraft - the amount by which withdrawals exceed deposits. Overdraft Protection - a checking account feature in which a person has a line of credit to write checks for more than the actual account balance. Instead of getting charged about $25 for bouncing a check, overdraft protection will in effect provide the account holder with an instant loan. The interest rate will be extremely high, but if it is paid off quickly it is usually much less expensive than the bounced check fee. Some banks do charge a fee when an account balance falls below zero even if the account holder has overdraft protection, but it's still significantly less than the bounced check fee. Copyright © Texas Education Agency, 2012. All rights reserved.

Copyright © Texas Education Agency, 2012. All rights reserved. Banks vs Credit Unions Banks For-profit institution Makes loans, pays checks, accepts deposits and offers other banking services Insured by the FDIC Credit Unions Not-for-profit institution Owned by its members Offers personal loans and other banking services Insured by the National Credit Union Administration (NCUA) Copyright © Texas Education Agency, 2012. All rights reserved.

Researching Banking Options You have $500 to deposit into a checking account and it’s up to you to use the Internet to find the best “bargain” bank—the one that offers the most services for the lowest associated fees in the Pearland area. Collect your data and put it in the chart. Watch out for these hidden fees: • Monthly maintenance fees • Overdraft fees • Minimum balance requirements • ATM charges • Penalties for breaking terms • Withdrawal limits Keep your eyes open for these techsavvy services: • Online bill payment • Direct deposit • Availability to check account balances 24/7 • Text message banking • Mobile Web apps • Account alerts Copyright © Texas Education Agency, 2012. All rights reserved.