DC Personal Finance Unit 5
When to record debit card transaction
as soon as you see it
Liquid Assets
cash and items of value that can easily be converted to cash
Typical banking services
check writing, deposits, overdraft protection, checking accounts, minimum fees, interest rates
When to start a financial plan
the sooner the better
Cashier's check
A check bought from a bank with payment guaranteed by the bank
Certified check
A check for which the bank assures that the drawer has sufficient funds to make payment. (large amount)
savings account
An account at a depository institution that is designed to hold money not spent on current consumption
Smart Card
An electronic funds transfer tool that is a combination credit card, debit card, phone card, driver's license card, and more.
Online Banking
An electronic way to view account activity and pay bills via the Internet and an institution's website.
Savings and loan associations
Banks originally established to help people buy homes.
FDIC
Federal Deposit Insurance Corporation: A federal guarantee of savings bank deposits initially of up to $250,000
Reconciliation process
Final step in valuation process. Analyze and weigh estimates of value from market, cost, and income approaches NOT an average of the value estimates
Deposit-Type Financial Institutions
Financial institutions that provide traditional checking and savings accounts. Commonly referred to as "banks."
Credit unions
Nonprofit, member-owned financial cooperatives that offer the full variety of banking services to their members.
3 Endorsements
Restrictive, Blank, and Special
Money Market Deposit Account (MMDA)
a federally insured savings account, offered by banks and other depository institutions, that competes with money market mutual funds
Series EE bonds
a savings bond issued in various denominations by the U.S. Treasury
Traveler's Check
a special form of check that functions as cash
Overdraft protection
an automatic loan made to you if you write a check for more money than you have in your account
EFT transactions
any financial transaction that takes place electronically
Asset management accounts
Comprehensive financial services packages offered by a brokerage firm, which can include a checking account, credit and debit cards, MMMF, loans, automatic payment of fixed payments such as mortgages, brokerage services (buying and selling stocks or bonds), and a system for the direct payment of interest, dividends, and proceeds from security sales into the MMMF.
what to compare when choosing an investment type
interest rates
NOW accounts
interest-bearing checking accounts
demand deposit
money in a checking account that can be paid out "on demand" or at any time
CD
pays a fixed rate of interest for a set time-penalty to withdrawal early