Banking (Part 1) Mr. Stasa – Willoughby-Eastlake City Schools ©

ESSENTIAL QUESTION #7  Only 55% of teenagers keep their money at a bank or credit union. Why do you think some teenagers may be hesitant to keep their money at a bank?

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Financial Services Offered Online Banking, Online Brokerage, Checking Accounts, Savings Accounts, Certificates of Deposit (CDs), Individual Retirement Accounts (IRAs), Savings Bonds, Credit Cards, Check Cards, Gift Cards, Payroll Cards, Commercial Prepaid Cards, Auto Loans, Boat Loans, RV Loans, Student Loans, Other Loans, Home Mortgages, Mortgage Refinance Loans, Home Equity Loans, Military Bank, Student Centers, Accessible Banking, Small Business Banking Services, Merchant Services, Home Buying, Investment Services, IRAs, Mutual Funds, 529 College Savings Plans, Life Insurance (various types), Long-Term Care Insurance, Homeowner’s Insurance, Renter’s Insurance, Condo Insurance, Auto Insurance, Supplemental Income Insurance, Foreign Currency Exchange, Traveler’s Checks, International Wire Transfers, and More

Why would you save your money using a bank account? 1. Money is safe  Fires and theft 2. Money earns interest 3. Money is insured  You will not lose your money if your bank folds

Financial Services  Financial services are the products and services offered by financial institutions (banks)  Examples include:  Checkbook issuing  ATMs  Online banking  Debit cards  Financial advice

Here’s What You Said About Banks vs. Credit Unions…  Credit union is non-profit  unlike banks credit unions are non-profit organizations. Their profits are distributed right back to their members. Because of this, credit unions often charge lower fees than banks and pay higher interest rates on savings accounts, money market accounts, interest checking accounts and certificates of deposit  Credit unions are non-profit organizations. Credit unions offer lower fees then banks, and pay higher interest rates.  Fees and loan rates at credit unions are generally lower, while interest rates returned are generally higher, than banks and other for-profit institutions.  Banks always find ways to boost their profit, but in a credit union its non-profit and any profit they make goes right back the the individual.  Credit Unions are a not for profit organization.  credit unions are non-profit organizations. Their profits are distributed right back to their members. Because of this, credit unions often charge lower fees than banks and pay higher interest rates on savings accounts, money market accounts, interest checking accounts and certificates of deposit.  Credit Unions are non-profit organizations. banks let you deposit and with drawl money.  credit union safer with members

Banks vs. Credit Unions  A bank is a for-profit financial institution where you can deposit your money.  Owned by investors who buy its stock  Anyone can open an account (all ages)  Serve people and businesses  Offer a variety of services

Banks vs. Credit Unions  A credit union is a not-for-profit financial institution where you can deposit your money  Owned by its customers  Only members (and immediate family members) of special groups can join  Churches, teachers, firefighters, etc.  Fees and loan interest rates are typically lower than banks  Offer same types of services as banks 

 Banks : FDIC ( Federal Deposit Insurance Corporation ) insures up to $250,000  Credit Unions: NCUA ( National Credit Union Administration ) insures up to $250,000 Account Insurance gxNA

Internet Banks vs. Traditional Banks  Advantages of Internet Banking :  UX4STjE UX4STjE  Savings Account Comparison:  Ally: savings-account/ savings-account/  Chase: ateSheetForCons pdf ateSheetForCons pdf

Failing Banks

Pros & Cons of Banks & Credit Unions Credit Unions  Keep fees at a minimum  Offer many services for free  Pay a higher interest rate to their customers  Charge their customers a lower interest rate for loans  Must belong to a specific group to join Banks  Charge high fees  Offer most or all services for a fee  Paying customers a low interest rate on deposits  Charge its customers a high rate of interest for loans.  ATMS are more conveniently located  Larger range of services  More recognized

Careers in Banking  BANK TELLER ($25,000 annually or $11/hr.)  Skills required :  Communication skills  Mathematics  Problem-solving  Decision-making  Cash handling  Technology  Education required :  High School diploma and on-job training  Future careers :  Loan officer  Sales Rep.  Debt counselor

 SAVINGS ACCT  CHECKING ACCT  CERTIFICATE OF DEPOSIT (CD)  MONEY MARKET