Check It Out 1

Check It Out 2

Introductions

• Instructor and student introductions

• Module overview

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Student Introductions

• Your name

• Your expectations, questions, and concerns about checking accounts

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Purpose

Check It Out will teach you how to use a checking account responsibly.

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Objectives

By the end of this course, you will be able to:

• State the benefits of using a checking account.

• Determine which checking account is best for you.

• Identify the steps involved in opening a checking account.

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Objectives (Continued)

• Add and withdraw money from a checking account.

• Reconcile a check register with a bank statement.

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Agenda and Ground Rules

• 2 hours long

• Two 10-minute breaks

• Training methods

• Class participation

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Checking Accounts

A checking account lets you write checks and use a debit card to:

• Pay bills.

• Make purchases.

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Benefits of Checking Accounts

• Convenience

• Cost

• Better money management

• Safety

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Convenience

Checking accounts:

• Give you quick and easy access to your money.

• Let you “direct-deposit” payroll and other checks.

• Eliminate the need to carry a lot of cash.

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Cost

Using a checking account is usually less expensive than using other services to cash checks or buy money orders.

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Better Money Management

Having a checking account lets you:

• Keep a record of “transactions.”

• Build a positive relationship with your bank.

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Safety

Having a checking account:

• Is safer than carrying large amounts of cash.

• Protects your checks and check card if they are lost or stolen.

• Means your money is insured up to the maximum amount allowed by law.

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How to Find the Right Checking Account

• Get recommendations.

• Answer the questions on the Determining Your Checking Account Needs Worksheet.

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Fee Schedule

Some common bank fees include:

• Monthly service fee

• Minimum balance fee

• Automated Teller Machine (ATM) user fee

• Overdraft fee

• Stop payment fee

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When a Checking Account Isn’t Right for You

If you:

• Don’t write many checks.

• Tend to “bounce” checks.

• Can’t find a checking account for which you can maintain the minimum balance.

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Practice Exercise: Choosing the Right Checking Account

Instructions:

• Read each scenario carefully.

• Indicate whether or not David should get a checking account. Be prepared to explain your answer.

• Then read and answer the questions about fees a bank might charge.

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Types of Checking Accounts

• Free/low-cost checking

• Electronic/ATM checking

• Regular checking

• Interest checking

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Documents Needed to Open a Checking Account

• Photo ID

• Social Security number (SSN) or Individual Taxpayer Identification Number (ITIN)

• A deposit

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Account Verification

The bank or credit union reviews your checking account history to make sure that:

• You will be a responsible customer.

• No one is trying to steal your identity to open an account.

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Signature Card

The document that identifies and contains the signature of the owner of the account.

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Two Ways to Use Money in Your Checking Account

• Write a check.

• Use electronic banking.

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Steps to Writing a Check

• Make sure you have enough money in your account.

• Complete the blank spaces on the check.

• Record the transaction in your check register.

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Sample Check

YOUR NAMEYOUR ADDRESS

YOUR PHONE NUMBER

PAY TO THE ORDER OF

105

00-6879 770

Dollars

FINANCIAL INSTITUTION Your City, State, Zip Code

:00000000 : 0000 0000 0 000 0 0.:

Memo

$

Date:_______

1 38 9

64 5

11 10

27

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Back of the Check

ENDORSE HERE

DO NOT WRITE, STAMP OR SIGN BELOW THIS LINERESERVED FOR FINANCIAL INSTITUTION USE *

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Sample Checks

YOUR NAMEYOUR ADDRESS

YOUR PHONE NUMBER

PAY TO THE ORDER OF

105

00-6879 770

Dollars

FINANCIAL INSTITUTION Your City, State, Zip Code

:00000000 : 0000 0000 0 000 0 0.:

Memo

$

Date:_______

YOUR NAMEYOUR ADDRESS

YOUR PHONE NUMBER

PAY TO THE ORDER OF

105

00-6879 770

Dollars

FINANCIAL INSTITUTION Your City, State, Zip Code

:00000000 : 0000 0000 0 000 0 0.:

Memo

$

Date:_______2/26/20XX

Coffee Mart 19.75Nineteen and 75/100

Your signaturecoffeemaker

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Electronic Banking

Electronic banking uses computers to move money into and from your account. It includes:

• Debit card transactions

• Electronic bill pay

• ATM transactions

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Debit Card

A debit card lets you:

• Deposit cash into and withdraw it from your checking account.

• Make purchases at retail locations. BE CAREFUL!

The money is immediately taken out of your account.

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Electronic Bill Pay

A service that automatically takes money out of your account to pay your bills.

• You don’t have to pay for postage.

• You don’t have to worry about late payments.

You can also use bill pay to make payments to businesses to which you owe money.

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Automated Teller Machine (ATM)

1

3

2

4

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Four Ways to Add Money to Your Checking Account

• Cash or check deposit using the teller service

• ATM deposit

• Deposit by mail

• Direct deposit

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Sample Deposit Slip

Your NameYour Address

Your Phone Number

DE

PO

SIT

TIC

KE

T DATE 3/22/20XX DEPOSITS MAY NOT BE AVAILABLE FOR IMMEDIATE WITHDRAWAL

SIGN HERE IF CASH RECEIVED FROM DEPOSIT

YOUR FINANCIAL INSTITUTION

YOUR CITY, STATE Zip Code

DO NOT USE FOR AUTOMATIC PAYMENT OR CHECK

TRANSACTIONS

:00000000 : 00000 00000.:

CURRENCY

COIN

CHECKS

OR TOTAL FROM REVERSE

SUBTOTAL

LESS CASH RECEIVED

NET DEPOSIT

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Sign the Back of the Check

ENDORSE HERE

DO NOT WRITE, STAMP OR SIGN BELOW THIS LINERESERVED FOR FINANCIAL INSTITUTION USE *

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Sample Deposit Slip Front and Back

Your NameYour Address

Your Phone NumberD

EP

OS

IT

TIC

KE

T DATE DEPOSITS MAY NOT BE AVAILABLE FOR IMMEDIATE WITHDRAWAL

SIGN HERE IF CASH RECEIVED FROM DEPOSIT

YOUR FINANCIAL INSTITUTION

YOUR CITY, STATE Zip Code

DO NOT USE FOR AUTOMATIC PAYMENT OR CHECK

TRANSACTIONS

:00000000 : 00000 00000.:

CURRENCY

COIN

CHECKS

OR TOTAL FROM REVERSE

SUBTOTAL

LESS CASH RECEIVED

NET DEPOSIT

Check

EN

TE

R T

OT

AL

ON

TH

E F

RO

NT

OF

TH

IS

TIC

KE

T

Cen

tsD

ollars

Ch

ecks

Lis

t si

ng

ly

1 2 3 4 5 6 7 8 9 10

11

12

13

14

15

16

TO

TA

L

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ATM Deposits

• Similar to making an ATM withdrawal.

• Use the special deposit envelope.

• Remember to get a receipt.

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Mail Deposits

Include a deposit slip with the check.

NEVER send cash through the mail.

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Direct Deposit

• Checks are deposited directly into your checking account.

• Your money is available immediately.

• It’s the safest way to receive your money.

• Signing up is easy at your financial institution.

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Keeping an Accurate Record of Checking Account Activity

• Record all transactions.

• Record maintenance fees, interest, and other bank charges.

• Review the monthly checking account statement.

• Reconcile your check register with your monthly checking account statement.

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Checking Account Statement

A record of all transactions made during the preceding month, including:

• Cashed checks

• All withdrawals and deposits

• Debit card purchases

• Fees

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Reconciling Your Checking Account

Finding the reasons for the difference between your checkbook register balance and the checking account statement balance caused by:• Transactions on the bank statement that

weren’t recorded in the check register.• Transactions recorded in your check register that were made too late to appear

on the bank statement.

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Checking Account Reconciliation Form

CHECKS OUTSTANDING - NOT CHARGED TO ACCOUNT

   

$

Check Number

Check Amount  

     

    $

    Total $

     

    $

      $

      $

    Balance $

     * This balance should agree with balance in your check register.

Total $  

Bank balance shown on this statement

Subtract withdrawalsoutstanding

Add deposits outstanding

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“Bad” or NSF Check

A check you write when there isn’t enough money in your checking account to cover it.

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Consequences of Writing Bad Checks

• Bad check fees

• Negative activity reported

• Bank closes your account

• Civil and/or criminal prosecution

• Merchants may not accept your checks

• Your credit may be impacted