1. Investing and Banking FONTBONNE UNIVERSITY FINANCIAL LITERACY AND DEFAULT PREVENTION FACILITATED BY JAMES “VINNY” VINCENT ASSOCIATE DIRECTOR, FINANCIAL LITERACY LIAISON

2. Savings versus Investing  Saving: used to accomplish short-term/mid-term goals (vacations, holidays, emergencies, etc.)  Checking Accounts  Savings Accounts  Money Market Accounts  Certificates of Deposit (CDs)  Bonds  Investing: used to accomplish long-term activity (retirement, college, etc.)  Impact of Inflation: invest in areas which will maximize your return to combat against inflation (+3-4% per year)  Risk and Return Relationship: the higher the return, generally the higher the risk; can you afford a setback?  Impact of Long-term Investing: the longer you let your money sit, the greater the return you require  Simple Investment Options are Best: mutual funds, index funds, employer plans, guaranteed funds, IRAs

3. Banks versus Credit Unions Banks More fees Higher fees for bounced checks, ATMs, etc. More branches/ATMs available More savings plans/loan programs Higher minimum balances required Low interest rates on savings/higher interest rates on loans Very structured, more procedures/rules Credit Unions Fewer fees Lower fees for bounced checks, ATMs, etc. Usually one location or one region Fewer savings plans/loan programs Low or no minimum balance required Higher interest rates on savings/lower interest rates on loans Loose structure, fewer procedures/rules

4. Tips for Banking Utilize Direct Deposit Many banks waive account fees if your paycheck is direct deposited into your account Convenience of avoiding bank lines Average Daily Balance Some banks charge a fees if your balance falls below a certain amount Basic Checking Pays no interest but requires no minimum balance May limit number of checks or ATM withdrawals Avoid ATM Fees Out-of-network ATMs may charge a fee on top of your bank’s fee Some banks charge a fee for using your card as a debit at the grocery store!

5. Wise Tips of the Trade Have the “Customer” mentality The banks are fortunate that you chose them to house your money Fight for what is fair Banking is a privilege Be responsible with your money Avoids overdrafts Will accrue a fee for each transaction Debit Cards Using your own money, not borrowing money Usually requires a PIN Money is immediately deducted Cashing A Check Banks will often hold them a certain number of days Money is not always available immediately

6. Seminar Activity  For this activity, you will need to visit a bank.  Step 1: Ask a staff member for information regarding their bank policies and procedures with regards to their checking and savings account programs.  Step 2: Ask a staff member for information regarding any investment programs the bank may offer to customers.  Step 3: Ask for a business card of the staff member who assisted you.

7. Questions?  Contact James “Vinny” Vincent  jvincent@fontbonne.edu jvincent@fontbonne.edu  314.719.4353  Office Hours: Monday thru Friday (8:30am-4:30pm)  Lunch taken daily from 12:30pm – 1:30pm