FINANCE Chapter 9

FINANCEChapter 9Checking Accounts

and Other Banking Services

Lesson 9.1Checking Accounts GOALS:

Describe the purpose of a checking account

Discuss how to prepare banking forms

Be able to distinguish between different types of checking accounts

Advantages?

Checking Accounts and Other Banking Services1. Checking accounts are convenient and safer

than carrying cash. Canceled checks serve as receipts. Budgeting is facilitated because check

records are kept.2. Opening a checking account is quick and

easy. A signature authorization form is prepared. You must have an initial deposit of $50

Continued…3. Rules of writing checks

Deposit slips should be used for adding money to the account.

The checkbook register should be kept accurate and a new balance calculated after every entry.

The checkbook should be reconciled immediately when the bank statement is received.

Continued…4. Check endorsements allow a check to be

cashed or deposited.5. There are many types of checking accounts

(special, standard, interest-bearing, or sharedraft.)

6. There are many banking services available: stop payment orders, certified checks, cashier’s checks, money orders, debit cards, safe deposit boxes, loans and trusts, financial services, bank credit cards, automated tellers (ATMs), online and telephone banking.

Writing a CheckA. Check numberB. ABA NumberC. Maker’s Preprinted Name and AddressD. DateE. PayeeF. Numeric AmountG. Written AmountH. Drawer or MakerI. Account NumberJ. Memo

Using a Checkbook Register Write clearly and legibly. Keep a running balance. Double-check your math. Enter all payments made by check, as

well as deposits, withdrawals, and other online transactions at the time these transactions occur.

Check Endorsements Determine how a check can be

cashed or deposited. Protect you in the event a check is

lost or stolen.

Lesson 9.2Other Banking Services GOALS:

Describe various banking services. Identify services for which banks

commonly charge fees.

Money Other Than Checks When you don’t want to send cash, but your

check isn’t acceptable, consider:1. Certified Check – Your own check

guaranteed by the bank. Your money is set aside to pay the check. A certified check will not bounce

2. Cashier’s Check – A check drawn by the bank on it’s own funds. You must pay cash for it, or have it taken from your checking or savings account. A cashier’s check will not bounce.

Continued…3. Money Order – A method of payment

purchased at banks, post offices, and other businesses. Generally, you must pay cash (your personal check is usually not sufficient). The money order will not bounce.

Banking Fees Banks charge fees to their customers to help

cover their operating costs (especially non-customers).

Most charge for: overdrafts, using tellers, balances that fall below the stated minimum, cashier’s and certified checks, travelers’ checks, use of other banks’ ATMs, online bill payment, and monthly account servicing.

Avoid fees by signing up for the kind of account that best fits your needs.