Checking Accounts Chapter 23.2 Describe types of checking accounts and how to open an account Illustrate how to write and endorse a check, maintain a check register, make a deposit, and reconcile a bank statement

Understanding Checking Accounts Checking accounts are one of the most commonly used banking services. Checking accounts have two main advantages: safety and convenience. Checks provide a safe and convenient way to pay bills.

Types of Checking Accounts A regular account, often called a minimum balance account, requires that the customer maintain a certain minimum balance. A second basic type of checking account is the special account, often called a cost per-check account. Another type of checking account is an interest- bearing account called a negotiable order of withdrawal (NOW) account. Most credit unions offer a type of checking account called a share draft account.

Opening A Checking Accounts Signature Card asks for your name, address, phone number, Social Security number, and similar data. At the end of the card, there is a place for your signature. The signature that you put on the card should be your legal name, not a nickname.

Writing A Check Date: Record the date on the check. This will help you keep accurate records. Never date a check ahead of time(postdating) because you do not have enough money in your account. Payee: The person or institution that you write the check to is the payee. It is proper to ask individuals how they would like the check made out.

Keeping A Checking Register After you open an account, you will receive a supply of imprinted checks and a check register. The register is where you keep a record of checks written, deposits made, and other transactions. One checkbook style has a stub attached to each check, another uses a two part form( a carbon copy behind each check) that provides customers with a record of the transaction.

Endorsing A Check An endorsement is your signature, sometimes with a brief message, on the back/left side of a check. You must endorse a check a check before you can cash or deposit it. There are 3 common types of endorsements: blank, restrictive, and full. A blank endorsement is simply your written signature. A restrictive endorsement is a message and a signature that restrict the use of the check. A full endorsement is used when you want to pay someone else with a check that is made out to you.

Making a Deposit and Balancing a Statement The process of putting money into a checking account is known as making a deposit. A deposit ticket is used to deposit any combination of currency, coins, and checks. Once a month, the bank will send you a packet that includes a statement of account and the canceled checks that you wrote. The process of comparing the statement with your check register is known as balancing a checkbook. In some cases, the word reconciling may be used instead. The purpose of balancing a checkbook is to ensure that both you and your bank have recorded your checks, your deposits, and other activity in your account accurately.