1. MoneyCounts: A Financial Literacy Series
Banking
11-A Grange Building
University Park, PA 16802
financialliteracy.psu.edu

2. Description
Banking: business activity of accepting and safeguarding money owned by other individuals and entities, and then lending out this money in order to conduct economic activities (e.g., making profit, covering operating expenses) 

3. Learning Outcomes Know the key terms you need for banking
Understand what a bank is and what a credit union is
Understand how to decide who should safeguard your money
Expect what would happen if you do not use a bank or a credit union
Understand how to get the most of your banking experience

4. What is Banking?

5. Banking System in the USA?

6. Federal Reserve System – 12 Central
Map of the twelve Federal Reserve Districts, with the twelve Federal Reserve Districts enumerated in black circles and the twelve Federal Reserve Banks marked as black squares. Branches within each district are marked as red circles. The Washington, D.C. headquarters is marked with a star enclosed in a black circle.

7. Why use a financial institution?
Safeguard your cash
Use debit and credit card services
Manage your finances (Record keeping and budgeting)
Earn interest
Receive your paycheck quickly using direct deposit
Borrow loans
Facilitate financial transactions
Invest your money
Establish a credit history to generate a FICO credit score instrumental in borrowing funds and building wealth
Insure your liquid assets

8. Key terms you need to know
Checking account & Saving account
Routing number
Certificate of Deposit
Account number
Money market account
Debit card & Credit card
Automatic bill payment & bill-pay
Online banking
Payroll direct deposit
Automated teller machine (ATM)

10. Banks
Can be central, commercial, retail, and investment financial institutions
Insured by the Federal Deposit Insurance Corporation
Can have multiple locations (national and international)
Eligibility to join has little restrictions to none
Convenience and numerous ATM machines
Sophisticated electronic banking technology
Wide range of choices in services and products
Profit-driven to satisfy shareholders
They serve customers

11. Credit Unions Can be federally or State chartered
Insured by different insurance corporations other than FDIC
Have limited locations by region or state
Eligibility to join is restricted to individuals affiliated with certain groups
Limited ATM locations
Limited online banking services, depending on size
Limited range of choices in services and products, depending on size
not-for-profit driven to satisfy members/owners
They serve members/ de facto owners

12. Side by side! Bank Credit Union Types
Central, commercial, retail, and investment financial institutions
Federally or State chartered
Insured by
Federal Deposit Insurance Corporation (FDIC)
Different insurance corporations other than FDIC
Locations
Multiple locations (national and international)
Limited locations by region or state
Eligibility to join
Little restrictions to none
Restricted to individuals affiliated with certain groups
ATM
Convenience and numerous machines
Limited ATM locations
Online
Sophisticated electronic banking technology
Limited online banking services, depending on size
Choice
Wide range of choices in services and products
Limited range of choices in services and products, depending on size
Profit
Profit-driven to satisfy shareholders
Not-for-profit driven to satisfy members/owners
For whom
Serve customers
Serve members/ de facto owners
Side by side!

13. Who should guard your money?
In-person or online
Your lifestyle
Services you want/need
Your occupation
Price or convenience
Current location
Temporary or long-term
YOUR decision

14. Un-Banked?

15. Tips to get the most of banking experience!
Adopt an emergency fund
Know the value of each institution
Know what you “need” and “want”
Find free services for students
Find the highest interest rate on a saving account
Consider the cost of using ATM
Know that you are free to deposit financial aid refund checks
Seek trusted information!

16. MoneyCounts: A Financial Literacy Series
Comments and questions
11A Grange Building
University Park, PA 16802
financialliteracy.psu.edu