ENDORSING, DEPOSITING & RECONCILING Understanding Checking Accounts and Debit Card Transactions

Making a Deposit

Endorsing a Check Endorsement Three types of endorsements: Signature on the back of a check to approve it to be deposited or cashed A check must be endorsed to be deposited Three types of endorsements: Blank Restrictive Special

Blank Endorsement Receiver of the check signs his/her name Anyone can cash or deposit the check after has been signed

Restrictive Endorsement More secure than blank endorsement Receiver writes “for deposit only” and account number above his/her signature Allows the check to only be deposited

Special Endorsement Receiver signs and writes “pay to the order of (fill in person’s name)” Allows the check to be transferred to a second party Also known as a two-party check

Now it’s your turn to practice Endorsement Practice

Practice Answers Blank Restrictive Special Student’s Signature X Endorse Here X For Deposit Only—Acct. # 987654321 Student’s Signature Endorse Here Special Pay to the Order of Jonathon Smith Student’s Signature X Endorse Here

Making a Deposit Deposit slip Contains the account holder’s account number Allows money (cash or check) to be deposited Located in the back of the checkbook Deposits can be made with a mobile app at an ATM or with a bank teller Don’t forget to record your deposit in your spreadsheet!!

Completing a Deposit Slip Date The date the deposit is being made

Completing a Deposit Slip Signature Line Sign this line to receive cash back

Completing a Deposit Slip Cash The total amount of cash (and coin) being deposited

Completing a Deposit Slip Checks List each check individually Identify each check on the deposit slip by abbreviating the name of the check writer

Completing a Deposit Slip Checks If more checks are being deposited than number of spaces on the front, use the back List each check Add the total, enter it on the front

Completing a Deposit Slip Total from Other Side The total amount from all checks listed on the back

Completing a Deposit Slip Subtotal The total amount of cash and checks

Completing a Deposit Slip Less Cash Received The amount of cash back being received This amount is not deposited into account

Completing a Deposit Slip Net Deposit The amount being deposited into the account To calculate the amount, subtract the cash received from the subtotal

Now it’s your turn to practice Deposit Slip Practice

Practice Answer

Checking Account Register Place to record all account transactions for a checking account Deposits, checks, ATM use, debit card purchases, additional bank fees Provides a running balance Using your debit card and mobile banking app before you buy will help your account remain balanced

Reconciling your Checking Account Reconcile Balancing your spreadsheet each month to match the balance shown online in your bank account. Knowing the correct balance can help to avoid bouncing checks

What is a cancelled check? A check that has cleared the depositor’s account and has been marked “canceled” by the bank Can be used as proof of payment Used to be returned in a mailed monthly statement Current day – images of scanned copies are added to a monthly statements A check that has cleared the depositor's account and has been marked as "canceled" by the bank. A canceled check has been paid by the drawee bank and endorsed by the payee, the payee's bank, and the Federal Reserve Bank. Canceled checks can also be used as proof of payment.  Investopedia explains 'Canceled Check' In the past, canceled checks used to be returned to the bank account holder each month with their monthly statement. That is now rare, and most check writers receive scanned copies of their canceled checks while the banks keep the physical copies for safekeeping. Customers that utilize online banking can also access copies of their canceled checks via the web. A canceled check, like any other financial information, should be safeguarded and stored in a safe place as it contains your bank account and routing number. These two numbers together could be used by identity thieves to gain access to the funds in your checking account. 

Reporting Lost/Stolen Cards If a checkbook, ATM, and/or debit card becomes lost or stolen Immediately report it to the financial institution File a report with the police Reported lost/stolen checkbook: Financial institutions generally do not hold the account holder liable for any fraudulent charges

Lost/stolen cards cont Reported lost/stolen ATM/debit card: Within 2 business days Cardholder is only liable for $50.00 Longer than 2 business days Could be liable for up to $500.00 Varies depending upon the financial institution

Traveler’s Checks Used in place of currency when traveling to foreign countries Insured against loss and theft by the issuing party NOT the FDIC Customers pay a small fee to purchase (1-2%)

Safety Deposit Box Located inside a bank - used to store valuables (documents, jewelry) Customers pay an annual rent and accessed with keys or PIN number Valuables are not insured by the FDIC Safety Deposit Boxes Obsolete The Truth About Safety Deposit Boxes Definition of 'Safe Deposit Box' A box - usually located inside a bank - which is used to store valuables. A safe deposit box is rented from the institution and can be accessed with keys, pin numbers or some other security pass. Valuables such as documents and jewelry are placed inside and customers rely on the security of the building to protect those valuables. Investopedia explains 'Safe Deposit Box' The contents of a safe deposit box are not insured in the same way bank deposits are. The Federal Deposit Insurance Corporation insures cash deposits up to a certain limit, but due to the fact that there is no way to verify the contents of a safe deposit box, banks will not insure their contents. Also, if heirs are not told about the location of the drawer, upon non-payment, the box is considered abandoned, and its contents are turned over to the state's unclaimed-property offices for auction.

Money Order A certificate that allows the payee to receive cash – similar to a check Issued by a bank, post office or retail store for a fee Often used by those who don’t have access to a checking account. Definition of 'Money Order' A certificate that allows the stated payee to receive cash on-demand, usually issued by governments and banking institutions. A money order functions much like a check, in that the person who purchased the money order may stop payment.  Investopedia explains 'Money Order' Money orders are readily accepted and converted to cash, and are often used by people without access to a standard checking account. Money orders are an acceptable form of payment for small debts, both personal and business, and can be purchased for a small service fee from most institutions.  Money orders were first issued by American Express in 1882, and later became popularized as traveler's checks. 

RECONCILING Definition of 'Money Order' A certificate that allows the stated payee to receive cash on-demand, usually issued by governments and banking institutions. A money order functions much like a check, in that the person who purchased the money order may stop payment.  Investopedia explains 'Money Order' Money orders are readily accepted and converted to cash, and are often used by people without access to a standard checking account. Money orders are an acceptable form of payment for small debts, both personal and business, and can be purchased for a small service fee from most institutions.  Money orders were first issued by American Express in 1882, and later became popularized as traveler's checks.