Questions and Answers
What are commercial banks often called due to their many services?
In most commercial banks and savings banks, the money you deposit is safe because it is insured by the ________ for up to $250,000.
FDIC
A _________ offers many of the same services provided by commercial banks.
savings and loans association
A ________ differs from a commercial bank and a savings loan association in that its services are for its members only.
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Most credit unions are insured by the ____.
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An ________ authorizes your bank to electronically pay certain bills directly from your account each month.
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An _____ can be used to withdraw money from your account when you are shopping in the mall.
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In order to use an ATM, you must have a _______.
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You may pay for purchases in a store without cash, check, or credit cards by using a ________.
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______ checking works very well for people who use online banking, banking by phone, or ATMs to do all their banking.
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A _______ is good to have if you want an interest-bearing account and can maintain the minimum balance.
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An ________ checking account allows you to earn interest and write checks on the same account.
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When two or more people share a bank account, it's called a _____ account.
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A check with a ______ endorsement can be cashed by anyone who possesses it.
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For deposit only is a common _____ check endorsement.
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A ________ is a record of the checks, deposits, and charges made to your account for a specific length of time.
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If you're going to be traveling, ________ checks are convenient to use.
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If you're paying a large sum of money, a ________ check may be a more acceptable form of payment than a personal check.
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A _______ check is a personal check with a bank's guarantee that the check will be paid.
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A _______ is a type of check for a specified amount of money payable to the specified payee which may be purchased at numerous places.
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_______ are small metal containers people rent to protect their valuables from fire and theft.
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A ______ savings account is a convenient form of savings, but it pays the lowest rate of interest.
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With a ______, you deposit money for a set period of time and earn a set annual rate of interest.
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Study Notes
Banking Institutions
- Commercial Banks: Full-service banks offering a wide range of financial services.
- Savings and Loan Associations: Similar services to commercial banks, primarily focused on housing and residential lending.
- Credit Unions: Member-only financial cooperatives providing services distinct from commercial banks and savings associations.
Insurance and Regulation
- FDIC: Insures deposits at commercial and savings banks up to $250,000, ensuring the safety of deposited funds.
- NCUA: Insures deposits in credit unions, safeguarding member contributions.
Transactions and Payment Methods
- Electronic Funds Transfer (EFT): Mechanism allowing automatic electronic bill payments from a bank account.
- Automated Teller Machine (ATM): Enables cash withdrawals and other transactions at various locations.
- Debit Card: Facilitates cashless purchases using linked bank accounts.
Account Types and Features
- Express Checking: Ideal for users relying on online banking, mobile banking, and ATMs for transactions.
- NOW Account: Interest-bearing checking account that requires maintaining a minimum balance.
- Interest-Bearing Checking: Allows earning interest while writing checks.
Accounts and Ownership
- Joint Account: Shared by two or more individuals.
- Blank Endorsement: Allows any holder of a check to cash it.
- Restrictive Endorsement: Limits a check to a specific purpose, commonly marked for deposit only.
Financial Documents
- Bank Statement: Summary of account transactions over a specified duration, including checks, deposits, and charges.
- Traveler's Check: Convenient, pre-printed checks used for travel, offering safety and ease.
- Cashier's Check: A secure payment method for large amounts, backed by the issuing bank.
Specialized Payment Instruments
- Certified Check: Personal check guaranteed by a bank, ensuring payment reliability.
- Money Order: Prepaid check that designates a specific payee and amount, purchasable at various locations.
Security and Savings
- Safe Deposit Box: Rentable, secured containers in banks for protecting valuable items from theft and fire.
- Regular Savings Account: Simple savings option with lower interest rate offerings.
- Certificate of Deposit (CD): Fixed-term deposit account providing a predetermined interest rate over a specified duration.
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Test your knowledge of important banking and investment terms with these flashcards. Each card provides a word and its definition, helping you to understand key concepts in the financial world. Ideal for students and professionals looking to enhance their financial vocabulary.
