1. Checking Accounts
Unit 1, Lesson 1

2. What is a checking account?
Tool used to transfer funds deposited into the account to make a cash purchase
Available at banks and credit unions

3. How do they work? Money is deposited into the account by:
Taking paycheck to the bank
Direct deposit
Transfer from another account
Money is taken from the account by:
Writing a check
Using a debit card
Electronic banking

4. Benefits of having a checking account
Can help manage money
Cash isn’t sitting around waiting to be spent
Written record of expenses using a check register
Makes bill paying more convenient
Reduces the need to carry large amounts of cash
Checks are considered cash in many places

5. Types of checking accounts
Basic checking accounts
Most widely used
Many do not pay interest
Interest-bearing checking accounts
Pay the customer interest usually on a monthly basis for using their money
Minimum balance is usually required
Fees are charged if balance is below the minimum required balance
Free checking accounts
No minimum balance
No maintenance fees
Joint checking accounts
Owned by more than one person
All owners have equal access to money

6. Opening a checking account
Application
Picture id
Name, address, phone number, ssn
Signature card once approved
Contains account information
Contains customer signature for transaction verification
Agreement of terms and conditions of the account
Also includes the signature of others authorized to use account
Initial deposit

7. Check registers
Place to immediately record all monetary transactions for your checking account
Used to record:
Written checks
Atm withdrawals
Debit purchases
Electronic payments
Deposits
Fees

8. Example of a check register

9. Let’s start a check register
Beginning balance is $1,000.00—a gift from your parents for making it to your senior year!
Be careful… they aren’t going to give you another gift like this for a long time!

10. Anatomy of a check
Preprinted piece of paper with the account holder(S):
Name
Address
Phone number
Driver’s license number
NO social security number!! Why?
Routing number
Bank account number
Check number
Signature line
Memo line

11. Example of a check

12. Practice writing a check
Written today
Written to wal- mart
Bought school supplies
For $28.59
Written today
Written to ford motor credit
Paid august’s car payment
For $197.50
Written today
Written to kfc
3 pc. Chicken dinner, soda, & dessert
$10.72

13. Bouncing a check…
Check written for an amount over the current balance in an account
Insufficient funds (IF) or Nonsufficient funds (NSF)
Charged a substantial fee by both the bank and the payee where you wrote the check)
For example, bouncing a check to a business may cost you $25 charged by the business and $25 charged by your bank.
What if the check was only for $5??
Fees are charged for Each check that tries to be cleared!
If you bounce three checks and the bank charges $25… you have been charged $75 by the bank!
Can harm your credit report which is used to determine your “credit worthiness” for additional credit (A car, a home, a loan)

14. What is an atm? Transactions are automatically posted to the account
Automated teller machine
Allows customers to perform banking transactions as if they were made inside the bank with a teller
Deposits
Withdrawals
Account transfers
Check account balances
Transactions are automatically posted to the account
Immediately record all atm transactions into the check register
Very convenient
Drive-thru
After normal banking hours

15. More about atms Owned by different banking institutions
Usually charge a fee (between $0.50 and $3.00) if the atm is not owned by your bank
Must have a pin to access accounts
Available worldwide
Available in:
Banks
Supermarkets
Department stores
Convenience stores
Drive-through kiosks

16. Record ATM withdrawal In your check register, record an ATM withdrawal
Today’s date
Location of withdrawal (citizens bank)
For 50.00
ATM fee $2.50

17. Debit cards Used like a credit card
Money is automatically withdrawn at the time of purchase
Prevents overdrafts—transaction will not be authorized if there are insufficient funds
Record transactions into the check register
Most debit cards have the visa/mastercard logo and can be used where those are accepted

18. Pros & cons of a debit card
Can lose track of balance if transactions are not recorded
Opens checking accounts up to credit card fraud
If lost, anyone can use it
Someone else can gain access to your account if they find your card and the pin is learned
Pros
Convenient
Small
Can be used like a credit card
Allows a person to carry less cash
Does not allow overspending

19. Record debit card purchases
You ran to Dollar General to buy some shampoo and conditioner.
Your total bill was $14.97
Record this in your check register

20. endorsements Signature on back of check by the recipient
Types of endorsements:
Blank
Sign name
Anyone can cash or deposit once it is signed
Restrictive
More secure
“for deposit only”
Special
Allows check to be deposited to another person
“Third party” checks
Signature on back of check by the recipient
Checks must be endorsed to be deposited
Add a copy of the back of a check

21. Making a deposit

22. Practice writing deposit slips
It’s payday! (YAY!)
On august 10th, you will deposit:
$45.00 cash you earned when you mowed your grandma’s lawn
$10.00 check your friend owed you for buying gas last Friday
Check #413
$78.29 paycheck from mcdonalds
Check #19456
$22.14 check you found from last week from your aunt betty to buy school supplies
You also need to keep $50.00 cash for wild adventures 

23. Your turn… Complete the following transactions:
On 8/10, you wrote your next check to branch’s veterinary clinic for $100.00… your dog needed his yearly shots and check up.
On 8/12, you went to harveys for cheap chicken Monday. Your total bill was $13.24 and you paid using your debit card

24. On 8/12, you withdrew $25. 00 from the atm machine
On 8/12, you withdrew $25.00 from the atm machine. The machine will charge you $3.00.
On 8/13, you wrote a check to vsu to apply for admission. The application fee is $25.00.
On 8/14, You earned $ (check #651) for babysitting. Make the deposit but keep $35 for the football game.
On 8/16, you treated your friends to huddle house. You paid the $27.93 bill with your debit card.

25. How about some algebra??
Rich as t dollars in his checking account. On June 3, he deposited w, h, and v dollars and cashed a check for k dollars. Write an algebraic expression that represents the amount of money in his account after the transactions.

26. One more algebra problem 
Joby had $ in her checking account when she deposited g twenty dollar bills and k quarters. Write an expression that represents the amount of money in her account after the deposit.

27. Insufficient Funds fees
On August 29th, your balance was $ Over the next few days, the following checks arrived for payment at the bank: August 30, $423.45; August 31, $224.97; September 1, $45.47 and $22.78; and September 2, $ and $52.68.
How much will you pay in insufficient funds fees if your bank charges $ per check that does not clear?
What is the balance in your account on September 3?