1. Chapter 4
Checking Accounts

2. Checking Account
A checking account is a bank account that allows you easy access to your money
Use this account to pay bills/make most financial transactions
Access money by…
Writing a check
Setting up an automatic transfer (online)
Using your debit card

3. Opening a Checking Account
You can open a checking account online or you can go to the bank and open it in person
Monthly Maintenance Fee
Minimum Opening Balance

4. 4.1 – Deposits/Withdrawals
A deposit is an amount of money that you put into a bank account
A withdrawal is an amount of money that you take out of a bank account
An Automated Teller Machine (ATM) allows you to deposit or withdraw money electronically using a card
Requires a Personal Identification Number (PIN)

5. Using an ATM
Deposits can be made at most ATMs, but withdrawals can be made at all ATMs

6. Deposit Slip – Example 1
Margaret Miller makes a deposit at an ATM. She has a check for $ and a check for $ She would like to receive $40 in cash and deposit the rest of the money in her checking account. What is her total deposit?

7. Margaret C. Miller
March 11, 2012

8. Example 2
Manuel Romero is making a deposit in his checking account. He has checks for $435.20, $271.19, and $ He has cash consisting of 15 one-dollar bills, 7 five-dollar bills, 3 ten-dollar bills, 24 quarters, 5 dimes, 15 nickels, and 14 pennies. He would like to keep $75 in cash. What is his total deposit?

9. Example 2 (cont.) First, figure out the currency deposit
$15 + (7 x $5) + (3 x $10) =
Next, figure out the coins deposit
(24 x $0.25) + (5 x $0.10) + (15 x $0.05) + $0.14 =
To figure out the total deposit, remember to subtract the $75 that Manuel wants to keep for cash.

10. Mobile Deposit Most banks now offer mobile check deposit
An application that allows you to take pictures of checks with your smartphone or tablet and deposit the funds into your bank accounts.
If your bank offers mobile check deposit, you can avoid visiting a branch to deposit checks.

11. PNC – Virtual Wallet

12. Mobile Check Deposit - PNC

13. 4.2 – Writing Checks First you need to open a checking account
Allows the holder to write checks against money that has been deposited into it
A check directs a bank to deduct money from your checking account to make a payment
Account must contain as much money as the amount of the check you are writing
Can be penalized with overdraft fees

15. Writing Checks
When writing checks, you need to be able to write dollar amounts in word form, with the decimal portion expressed as a fraction.
Example: $65.38 would be written as….
Sixty-five and dollars
NOTE: and is only used to replace the decimal point

16. Writing Checks – Example 1
Bumper Allen is buying a leather jacket at H&M. He buys it on March 23. The cost of the jacket is $ Bumper is paying by check. How should he write the check?
1. Write the date. (All writing should be in pen)
2. Write the name of the person or organization to whom payment will be made
3. Write the amount of the check as a numeral
4. Write the amount of the check in words with cents expressed as a fraction
5. Make a notation on the check to indicate its purpose
6. Sign the check

18. Writing Checks
Questions?
Pg. 167, # 3-16.
Pg. 171, #15-24
DO WORK

19. Section 4.3 – Check Registers
A check register is used to keep a record of your deposits, electronics transfers (or automatic transfers, AT), and the checks you have written
The balance
is the amount
of money in
your account

20. Check Registers When you make a deposit, add
When you write a check or electronically transfer funds out of your account, subtract
The purpose of a check register is to make sure you don’t spend more than you have

21. Check Register
Number or code- If writing a check, put the check number here. Or use a transaction code:
DC for Debit Card
ATM for a cash withdrawal,
D for Deposit
T for a transfer to your savings account, etc.
BP for a online bill payment
Date- always record the date of anything you do

22. Check Register
Transaction Description- Make a quick note about the transaction (paycheck for… pizza… Rite Aid)
Payment/Debit- record the amounts of money going out of your account
Deposit/Credit- record the amounts of money coming into your account
Balance- How much money you currently have

23. Example 1
The previous balance in your check register is $ You make a deposit of $ You write a check for $ What is your new balance?

24. Online Bank Information
You can view your bank information online (transactions, balance, etc.) but BEWARE OF OUTSTANDING TRANSACTIONS
You may have less money than it appears!

25. Practice problems Pg. 172, #1-12
THERE WILL BE HOMEWORK!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

26. Section 4.4 – Bank Statements
A bank statement lists all of your checks that the bank has cleared, including any automatic transfers, ATM transactions, and deposits since your last statement
Once a month
Bank might tack on a service charge to your statement, which is a fee charged for services rendered

27. Bank Statements Present Balance =
Previous Balance + Deposits – Withdrawals – Service Charges + Interest

28. Example of a Bank Statement

29. Example 1 – Bank Statements
Your bank statement shows a previous balance of $ You make deposits of $ and $210.40, and write checks for $ and $ You have a $3.00 service charge. What is your present balance?
$ $ $ $ $ $3.00
= $1, present balance

30. Example 2 – Bank Statements

31. Section 4.5 – Reconciling the Bank Statement
When you receive your bank statement, check with your check register to make sure they agree. We reconcile the statement
Could find outstanding deposits or checks that didn’t post or didn’t clear

32. Reconciling the Bank Statement
When comparing the two, remember….
Adjusted Balance =
Statement Outstanding Checks/ Outstanding
Balance Payments or Debits Deposits

33. Example 1
Your statement balance is $ You have an outstanding check for $ and an outstanding debit of $ that didn’t post yet. You also have an outstanding deposit of $ What is your adjusted balance?
$ – ($ $235.42) + $231.98
$ – $ $231.98
= $ adjusted balance

34. Reconciliation Statement
Remember, an outstanding check or deposit is one that hasn’t been processed at the bank in time to appear on your bank statement
You can use the reconciliation form on the back of your bank statement to reconcile your account

35. Reconciling the Bank Statement
Pg. 179, #1-8 all
Make sure you ask questions if you are confused on ANYTHING. Don’t take this material lightly.

36. Online Banking
Online banking, or internet banking, allows you to bank from anywhere
All you need is a connection to the internet
Access you account(s) round-the-clock, any day

37. Online Banking Once logged into your account, you can…
Transfer funds from checking to savings or savings to checking
Make loan payments from checking to loan
Make payments to third parties
Get info about account balances, previous deposits, previous withdrawals, and loan balances

38. PNC – Online Banking

39. Online Banking – Lake Michigan Credit Union

40. Mobile Banking