BANKING SERVICES Activities involved in accepting and safeguarding money owned by individuals and companies and lending it to earn a profit.

Savings accounts  Savings account- interest is paid quarterly at a current rate.  Christmas club- special fund to save money for Christmas. Account is closed at the end of November.

Savings Account  Certificate of deposit- invest money for a specific time period of 182 days to five years. Interest rates are higher but there is a penalty if with drawn early.  Vacation account- place money in the account special for a vacation.

Savings Account  Money market deposit- benefits are you can write checks, transfer funds by phone, higher variable rates  Roth account- you add to this account until you retire. AT the time of retirement, you do not have to pay any taxes on it. You do pay taxes at this time. You will receive interest on your account.

Checking Account  Now account- this is an account that you will get interest on your money within the account. You must retain a certain amount to receive the interest  ATM card  Direct deposit  Free first check kit  Regular checking- this is an account that you use if you can not keep a minimum amount in an account. You write checks.  ATM card  Direct deposit  Free first checks kit

Loan Types  Mortgage- purchase a home. Fixed or adjustable rates.  Home Improvement Loan- money for home additions, repairs, energy saving improvements, and other remodeling

Loan Types  Construction Loans- get money to build a home or building and then it turns into a permanent loan (mortgage).  Automobile Loan- loan for a purchase of a car, truck or van

Loan Types  Investment Property- this is money for non- owner occupied residential properties.  Personal Loans- loan for vacations, college, or any other purpose. You must qualify.

Other Financial Services  Travelers checks- checks worth certain amounts  Money orders- amount sent to a company  Credit card- pay at end of month  Debit cards- money is subtracted immediately from account  Safe deposit boxes- keep valuables there  Cash advance  Overdraft protection- you will not be billed if a check is written that you can not cover

Questions to answer  What would be two advantages of having a Christmas savings account over just a regular savings account? (2 point question)  Why is it better for a person thinking about retirement to have a Roth account? Site two for each. (2 point question)  For a person right out of high school, which types of banking services would be the best to have and explain your reasoning. List two services. (4 point question)

Questions to answer  You have a friend that said they saw no reason to put their money into a savings account since the interest rate is so low. Explain why this is not true. (2 point question)

Questions to answer  If a friend needed money for the following, what type of account / loan would you suggest?  1. college  Vacation  Gifts for Christmas  Repair your car  Add a room onto your house

Tips for writing checks  Write with dark ink  Start at the left on all lines  Write clearly and spell correctly  Don’t sign the check until you have filled it in completely  Sign a check exactly as it appears on your account  Write a memo for you on the blank to remind you of what the check was for

Tips for writing a check  If you make a mistake, write the word “Void” on the check and start a new one  Always date the check  To deposit a check, write your full name in ink on the back  Do not sign a the back of a check until you are at the bank

Check Register  Record all deposits  Record all uses of the ATM card  Keep record of all checks that you write  Balance your checking account at the end of each month

Complete check and deposit slip in class Activity