Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Chapter

14

Banking

What types of financial services might help you to better manage your cash flows?

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Understanding the services provided by financial institutions will help you choose the best options to manage your money wisely.

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

direct deposit

automated teller machine (ATM)

debit card

commercial bank

savings and loan association (S&L)

credit union

certificate of deposit (CD)

money market account

rate of return

compounding

annual percentage yield (APY)

overdraft protection

stop-payment

endorsement

bank reconciliation

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Section 1 Financial Services and Institutions

Identify types of financial services.

Describe the various types of financial institutions.

Describe problematic financial businesses.

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

How to Manage Your Cash

Section 1 Financial Services and Institutions

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Types of Financial Services

Section 1 Financial Services and Institutions

Chapter

14

Banking

Categories of Financial

Services

SavingsPaymentServices

BorrowingOther

Financial Institutions

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Electronic Banking Services

Section 1 Financial Services and Institutions

Chapter

14

Banking

AutomaticPayments

With authorization, funds are withdrawn from your account

Make sure there are sufficient funds in your account

Check your bank statement to make sure the transfer is correct

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Electronic Banking Services

Section 1 Financial Services and Institutions

Chapter

14

Banking

Plastic Payments

Electronic payments

Online payments

Stored-value cards

Smart cards

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Evaluating Financial Services

Section 1 Financial Services and Institutions

Chapter

14

Banking

Is a higher interest rate on a certificate of deposit worth giving up liquidity?

Would you trade the convenience of getting cash from the ATM near your office for lower ATM fees?

Is it worth opening a checking account that has no fees—but does not earn interest, if you must keep a minimum balance?

Questions to Ask

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Types of Financial Institutions

Section 1 Financial Services and Institutions

Chapter

14

Banking

Non-Depository Institutions

Life Insurance Companies

Investment Companies

Finance Companies

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Problematic Financial Businesses

Section 1 Financial Services and Institutions

Chapter

14

Banking

Be Careful of These Financial Businesses

PawnShops

CheckCashingOutlets

PaydayLoans

Rent-to-Own

Centers

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Comparing Financial Institutions

Section 1 Financial Services and Institutions

Chapter

14

Banking

Where can you get the highest rate of interest on your savings?

Where can you obtain a checking account with low (or no) fees?

Will you be able to borrow money from the institution—with a credit card or another type of loan—when you need it?

Do you need an institution that offers free financial advice?

Is the institution FDIC- or SAIF-insured?

Does the institution have convenient locations?

Does it have online banking services?

Does it have any special banking services that you might need?

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Comparing Financial Institutions

Section 1 Financial Services and Institutions

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Analyze why it might be worth a person’s time to open a checking or savings account at a bank rather than using a check-cashing outlet.

Answers may vary but the students should realize that many banks offer free checking or savings accounts meaning you can cash a check for free.

Section 1 Financial Services and Institutions

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Section 2 Savings Plans and Payment Methods

Compare the costs and benefits of different savings plans.

Explain features of different savings plans.

Compare the costs and benefits of different types of checking accounts.

Use a checking account effectively.

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Types of Savings Plans

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Types of Savings Plans

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

You can purchase Series EE Savings Bonds from the federal government.

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Types of Checking Accounts

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

Checking Accounts

Regular Checking Accounts

Activity Accounts

Interest-Earning

Accounts

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Using a Checking Account

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

Check Register

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Using a Checking Account

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Using a Checking Account

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

Information on Your Bank Statement

Deposits

Checks You Have Written

ATM Withdrawals

Debit Withdrawals

Interest Earned and Fees

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Using a Checking Account

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

Organizations

Other Payment Methods

Certified Check

Cashier’s Check

Money Order

Travelers Check

Prepaid Travelers Cards

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Financial Institutions and Your Money

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

Banks make money by making loans.The amount of money a bank can lend is

affected by the reserve requirement set by the Federal Reserve.

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Consider whether you would prefer to have a separate checking and savings account, or an interest-earning checking account. Explain your decision.

Sample answer: separate accounts, to avoid a minimum balance or for higher interest rates.

Section 2 Savings Plans and Payment Methods

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

The Federal Reserve System

Chapter

14

Banking

The Fed has the responsibility of monitoring the economy.

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

Chapter

14

Banking

Glencoe Business and Personal Finance Copyright © by The McGraw-Hill Companies, Inc. All rights reserved.

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