Transcript Checking Accounts Money Management Chapter 9 Notes

Checking Accounts
Money Management
Chapter 9 Notes
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A _______________________________________ is a banking service wherein money is deposited
into an account and checks, or drafts, can be written to withdraw money from the account as
needed.
Only you, or people you’ve designated, can write checks on the account.
Checking accounts can be a useful and convenient tool.
____________________________________________________________________ , especially
when making a major purchase, or when paying bills through the mail.
Obviously, _________________________________________________________________ BUT
________________________________________________________________________________
________________________________________________________________________________
Most banks offer MANY different types of checking accounts. When you go to open an account you should
carefully weigh the accounts services and fees.
Questions to ask:
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____________________________________________________________________________?
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____________________________________________________________________________?
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____________________________________________________________________________?
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____________________________________________________________________________?
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____________________________________________________________________________?
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____________________________________________________________________________?
Examples of checking accounts offered and what services and fees they might include:
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Wachovia Bank
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US Bank
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Bank One
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http://www.wachovia.com/personal/page/0,,11_480_1427,00.html
http://www.usbank.com/cgi_w/cfm/personal/products_and_services/checking/check_acct_compare.cfm
http://www.bankone.com/answers/BolAnswersCompare.aspx?top=you&segment=PFS&topic=Checking&it
em=
_______________________________________________________________ are those that the
bank has already processed and paid out.
Banks used to mail you back all of your cancelled checks. Now most banks just scan them in to a
computer database and you can view them online.
This way you can see which checks have ___________________________________
(______________________) and which checks have not cleared.
For example, check this out:
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https://www.michedcuhb.org/onlineserv/HB/Signon.cgi
Checking Accounts
Money Management
Chapter 9 Notes
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In exchange for the convenience of using a checking account you accept certain responsibilities:
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You must and keep an accurate record of checks written and deposits made.
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You must maintain sufficient funds in your account to cover all the checks you’ve written.
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When you don’t have enough money in your account to cover a check that is called an
__________________________________ (_____________________________________).
“One of the age-old tricks for those who live check to check is “_________________________________ “…
what is that?
Well, that’s when ________________________________________________________________________
______________________________________________________________________________________
Floating a check is MUCH more difficult today because of computers. Banks are just much more efficient at
processing checks then they used to be.
FYI: Purposefully overdrawing your account is a ________________________ that can result in a fine,
imprisonment or both. Of course, it would have to be a pretty severe case in order to be prosecuted!
Opening an account
Need identification
Need to fill out a ______________________________________________________.
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This card provides the bank with important information… most notably
_________________________________________________________________________________
_________________________________________________________________________________
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Accounts could have a single drawer OR it could be a joint account with multiple drawers.
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This becomes very important if somebody ever tries to ________________________________ on
your account!
You should be able to look at a check and identify each of the following:
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__________________________ – usually in the upper right corner
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_________________________ – Usually appears as a fraction in the upper right corner below the
check number. The top half of the fraction identifies the location of the bank (Ex: Main Street, Ann
Arbor) The bottom half identifies the bank (Ex: Bank One)
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Preprinted _________________________________________________(that’s an easy one)
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The _________________________________ (another easy one)
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The _________________________________ -- who you are writing the check to
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The __________________________________________ -- dollar amount written as a number
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The __________________________________________ – dollar amount written as text
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The __________________________________________ – make it an easy one
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Your ______________________________________ – usually big long number at bottom center
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_______________________________________ – usually big long number in the bottom left corner.
This routes the check back to you bank.
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The ____________________________________ OR (___________________________) – allows
you to explain what the check is for or to provide your account number to the company you’re sending
the check to.
Writing a Check
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______________________________________
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______________________________________ … its ok to use cursive or to print.
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Sign your name the same way you did on your signature card.
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_____________________________ – if you make a big mistake you should
___________________________.
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Write the word “_________________________” in big letters across the front of the check and
save it for your records.
Make sure you have enough money to cover the check before you send it out into the wild blue yonder.
Checking Accounts
Money Management
Chapter 9 Notes
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Just as when you withdraw money from your account, you need to complete a form
each time you deposit money into your account. This form is called a
__________________________________.
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If you make the deposit through an ATM,
____________________________________ ________. It’s your only proof
of the transaction.
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A ___________________________________ is a record of all deposits and
withdrawals from a checking account.
If you use your checkbook register properly you will ____________________ know
the exact balance in your account.
Reconciling your checking account. Better known as
“___________________________________”
A _____________________________________ is the process of comparing your
monthly bank statement to your checkbook register to insure that the numbers
match.
________________________________________________________ .
________________????
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You may have ________________________________. Those are checks
that you’ve written that haven’t cleared yet. This would make your bank
statement look higher than your checkbook register.
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You may have _________________________________. These are deposits
you made after the bank already printed and mailed you the statement.
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You may have _________________________________________ that you
didn’t record in your register BUT that the bank has already subtracted.
You should balance your checkbook each month. Most Americans DO NOT and
that’s just poor money management. 
Checking Accounts
Money Management
Chapter 9 Notes
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Endorsing a Check:
A check _______________________________ be cashed until its been endorsed.
To endorse a check, the payee named on the face of the check __________________________
______________________________________________________________ in black/blue ink.
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_________________________________________________________! You can’t just go
crazy on the back of the check.
There are three major types of endorsements.
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________________________________ – just sign your name
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________________________________ – used when you are signing over the check to a
third person
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________________________________ – used to limit the use of a check. For example, you
can say “for deposit only” above your signature. This means that the check cannot be
cashed … only deposited.
Examples of different endorsement types:
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http://voc.ed.psu.edu/projects/CAPS/27CAPS.html
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This site is also a GREAT REVIEW of Chapter Nine Material! Check it out!
Other important topics mentioned in Chapter Nine:
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__________________________________ – Use Electronic Funds Transfer to update
balances as you make cash withdrawals and deposits from machines all over the world.
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__________________________________ – Special ATM Card that allows you to pay for
transactions right out of your checking account by simply swiping the card. Very convenient!
And much better than….
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__________________________________ – Bank sponsored credit card … usually a
MasterCard or Visa. If you qualify they will let you buy items on credit and pay for them
later…. At a high interest rate. We will go into MUCH greater detail about credit cards later
this semester.
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__________________________________ – banks sell money orders to people who don’t
want to use cash but don’t have a checking account. It’s used like a check but it can never
bounce because it must be paid for in advance. There is a charge for purchasing a money
order!
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__________________________________ – check that a bank verifies is GOOD! You go in,
they check your account, immediately deduct the money and stamp “certified” on the front.
This lets the business accepting the check breathe easier.