F INDING F INANCIAL S ERVICES AND T RACKING Y OUR M ONEY

F INDING F INANCIAL S ERVICES “Financial service providers” is a term used to describe all of the different types of businesses similar to a bank.

F INANCIAL S ERVICES The financial services industry includes many different kinds of organizations that provide many different kinds of financial services for their customers. Some of these organizations are banks, credit unions, credit card companies, insurance companies, stock brokerages, mortgage companies, and investment banks. Why are there so many? The rapid growth of technology has changed the way financial institutions do business, and it has increased the level of competition for customers. The term “financial services” became popular in the 1990s because of changes in federal banking laws.

A bank is an organization chartered (another word for licensed) by either the state where it is headquartered of by the federal government. Credit unions are similar, except they are nonprofit organizations owned by the people who use their services. Today, banks and credit unions provide basically the same kind of services for their customers.

Financial services provided by banks include: Checking accounts, savings accounts, interest on checking deposits, automatic deposit and payment, credit cards, check cards or debit cards, ATMs, online banking, storage of valuables, money transfers, overdraft protection, and traveler’s checks

C HOOSING F INANCIAL S ERVICES Deciding which financial services and financial providers to use can seem difficult. The more options you have available, the harder it is to choose. The explosion of technology has helped providers expand the number of services they offer and made them less expensive for you to use. Even though technology has reduced the cost of services to customers, financial institutions still charge a variety of fees for providing them. These fees help to offset the expenses for developing and designing the technology, for employee salaries and other expenses.

Fees are what you should consider when making financial choices. Other costs include your time, your ability to access services, and your level of skill using them. If you do not have the internet, do you want online banking? But, if you have access, there are many benefits – review your accounts 24 hours a day, track your spending, easily transfer money, and pay bills.

T RACKING Y OUR M ONEY Automated Tell Machine (ATM) – a computer terminal used to conduct business with a financial institution or purchase items such as postage stamps; also known as a cash machine Check – a written order directing the bank or credit union to pay a person or business a specific sum of money

Debit Card – a plastic card that provides access to electronic funds transfer (EFT) from an automated teller machine or point-of-sale (POS) terminal Reconcile – the process of comparing personal bank account records to the bank’s records of that account balance in order to uncover any possible discrepancies

While many people use debit cards and credit cards to make purchases, there are over 70 million checks written in the United States each year. That is almost 20,000 checks every day. Checks, debits, and credit cards are substitute for cash. Credit cards are LIKE LOANS, but checks and debit card transactions come directly out of your banking account. Knowing how to maintain a bank account can help prevent embarrassing and costly mistakes. Why do people write checks? Why are checks numbered? Why is it important to keep track of the checks your write and times you use your debit card?

We write checks or use debit cards to access money in our banking accounts. This may assist you in making purchases, paying bills, and carrying out other financial matters. Because both of these transactions are almost instant, it is very important to have the money in your account at the time you write that check or use the debit card and it is extremely important to write down each check and every debit card transaction. Why not carry cash? Some people feel that it is not safe or smart to carry too much cash. If lost or stolen, it cannot be replaced.

W RITING A C HECK Step 1 – Write the date in the upper right hand corner Step 2 – Write the name of the person or company receiving your check on the “pay to the order” line Step 3 – Write the dollar amount of the check in numbers in the small space with a $ Step 4 – Write the same amount in words on the line with “dollars” at the end

Step 5 – Sign your name on the signature line at the lower right Step 6 – Write your account number on the memo line Step 7 – Write down the check number, date, payee, and amount in the check register Step 8 – Subtract the amount of the check so you will know how much you have left

D EPOSITING M ONEY INTO Y OUR A CCOUNT Step 1 – Write the date on the deposit slip Step 2 – If you are depositing currency, write down the total amount in the space following the word currency Step 3 – If you are depositing coins, write down the total amount in the space following the word coin

Step 4 – Write down each check, including the person/business it is from and the amount, on a separate line and space Step 5 – total the amount of your deposit Step 6 – If you want cash from your deposit, write the amount next to “cash received” Step 7 – Subtract the cash from the subtotal and write the amount in the space following the words “net deposit” Step 8 – If you are withdrawing cash from your deposit, then you will need to sign your name on the line below the date

M ANAGING Y OUR A CCOUNT It is very important that you write everything down or you may become overdrawn which means that you have used more money than you put into your account. Banks charge “overdraft” or “insufficient funds” fees and business and merchants charge you a fee for giving them a bad check. One “hot check” (a check written on accounts with insufficient funds) may cost about $100 by the time you pay the fees.

R ECONCILING Y OUR S TATEMENT You will receive a bank statement (a record of all of the transactions on your account during the month) each month. It will list every check, ATM withdrawal, debit card use, fee charged, and deposit made. Reconciling should only take a few minutes. To reconcile, you simply compare the bank’s records with your records. Sometimes banks make mistakes and sometimes you may make a mistake. It is important to reconcile to find any potential errors.

T O R ECONCILE Step 1 – Record the balance in your check register Step 2- Subtract any bank charges

Step 3 – Find the balance and add any deposits not included on your statement (if you make a deposit after the statement was printed, it would not be reflected on the statement) Step 4 – Subtract all withdrawals that are not included on the statement If these amounts do not align, contact your bank immediately!