HUMS202: Module 2: You Can Bank On It! (Round 3: Managing an Account)

Overdraft

ATM with drawal

$35

Account balance = $50 - birthday cake $15 Account balance = $35 - gas $25 Account balance = $10 - phone bill $40 Account balance = $30 Overdraft fee of _____

$70

Account balance = $50 - phone bill $40 Account balance = $10 - birthday cake $15 Account balance = -$5 Overdraft fee of $35 - Gas $25 Account balance = -$30 Overdraft fee of $35 That's _______ in overdraft fees!

Mobile wallet

An app that used with debit, credit, or prepaid cards.

Yes. Always be cautious Find out about privacy practices and how your information is used. Some service providers may share transaction activity with other users. Check whether service provider's privacy settings allow you to turn off that feature. Periodically check privacy practices and your privacy settings.

Are there any privacy concerns?

Many possible fees Ask questions Are there fees... - to sign up? - to send money? - to receive money? - single, fixed transaction fee, or... - calculated as percentage of transaction amount?

Are there fees?

Depends who sponsors the P2P system: - financial institutions - non-financial institution Fun transferred from a P2P run by federally insured financial institution are federally insured.

Are transactions insured?

Make sure he reviews the timely of automatic bill payments and debits make from his account.

Asif makes it a habit to check his account balance frequently. Sometimes he still overdraw his account. What else can Asif do to make sure he has enough money in his account before making a transaction? How would you suggest Asif manage his account?

Transfer money from his savings account to his checking account and then pay for the repair using his debit card.

Asif needs to pay for repairs today to fix his car so he can get to work. He won't have enough money in his checking account until he gets paid on Friday. But he has money in his savings account for emergencies like this. How can Asif pay for the repair today without incurring debit or fees? What could Asif do?

Automatic debit

Authorize merchant or lender to take payments

Maybe

Can Charlie write checks with his checking account?

yes

Can some mount financial institution limit how many times she can withdraw money from her savings account each month? yes or no

True

Charlie just opened a checking account. He can use it to pay bills and withdraw money frequently? True or False

Automatic debit

Debit once or on a recurring basis

Read rules of accounts or ask a customer service representative at his financial institution questions, so he can understand the rules. He may want to ask about... Fees.

Derek just opened a savings account and a checking account. What should he do before using is accounts

Review her account transaction and statements regularly

Emma's friend found a bunch of suspicious transactions in her checking account months after they were made. She was able to get her money back, but it took a while. What can Emma do to help prevent the same thing happening to her? How would you suggest Emma manager account?

Checks and Other Payments

Financial institution decides whether to cover these transactions when you don't have enough money in your account

Make sure websites are secure - only provide personal and financial information on encrypted websites

How can Harold keep his information safe online?

Keep and review records - keep your own list - keep track of scheduled transactions

How can Savannah keep track of transactions she make with her savings and checking accounts? 1st suggestion

Review account statements - Monitor online if possible If something doesn't look right > tell financial institution

How can Savannah keep track of transactions she make with her savings and checking accounts? 2nd suggestion

- Use paper - based log - Use mobile app

How do you keep track of scheduled transactions to keep and review records?

- monthly or quarterly - option to review statements online - need a paper copy? ask.

How often will Savannah receive her account statements?

Checks and Other Payments

If transaction is covered, expect an overdraft fee

Checks and Other Payments

If transaction is not covered, may be charged a non-sufficient funds (NSF) fee - Merchant my charge you a returned check fee

- Expect the financial institution to decline ATM withdrawals and debit card transactions if you don't have enough money in your account - Generally, you will not be charged a fee

If you don't opt-in

- Financial institution may allow ATM or debit card transaction to go through, even if it exceeds your account balance - You should expect to be charged a fee to process each transaction

If you opt-in

It is even more important to review statements and transactions for fraud

Linked accounts?

Authorization hold

May last up to 15 days

ATM Cards

Might be able to make some purchases

Direct deposit

Money is safely and secure deposited into your account electronically

Checks

Not all checking accounts use checks

Is there a minimum balance you have to keep in your account? What happens if your account goes below the amount?

Questions about balances

What kind of fees are there? When are the fees charged? How can you avoid charged fees?

Questions about fees

Savings account - is there a limit on monthly withdrawals? What happens if you go over that limit?

Questions about transactions?

Authorization hold

Reduces money available in your account

$80

Rodney has $50 in his checking account. He opted-in to the overdraft program offered by his financial institution. What are his transactions

False

Savings account sometimes offer higher interest rates. True or false?

Automatic bill payment

Send payments electronically through your financial institution

yes

Simone open a savings account. So far, she only deposited money into my account at my local bank branch. Is there another way that Simone could make deposits? yes or no

True

Some checking accounts pay interests others do not. True or false?

Yes. you could use a - mobile wallet - person-to-person app

Sometimes Scott is shopping or he needs to pay a friend or the sitter. But I don't have any cash, we don't have his wallet or checkbook. Is there a way to pay without using cash, a card, or a check?

An authorization hold may be placed on funds

Stephanie used her debit card at a gas station. She noticed that the gas station put a hold on her checking account for $10. What does that mean?

Contact merchant or lender; or a financial institution

Stop a payment?

Checks

Tells financial institution to pay money for your account to the payee

Save you time!

The advantage of direct deposit is to

Encryption

The information is secure

ATM Cards

Use at Automated Teller Machines (ATMs)

P2P payments

Users link their bank account or credit card account to a mobile payment system. They can then transfer money to other people.

Overdraft

Vendor withdraws money from your account to pay bill is an example of...

Savings account

What accounts generally pays interest pay interest?

Set aside money for the future; frequent withdrawals are not intended

What are the limitations on how many times Simone can withdraw money from her savings account each month?

If possible, set up email and text alerts Ex. many financial institutions offer alerts when balances fall below a certain level, when there is a transaction over a certain amount, or when a transaction is made outside of the United States.

What happens if you go over that limit?

Mistyping recipient's email address, username, or amount can easily happen. Service provider pays the wrong person = rely on the service provider's own policies for fixing the error. Wrong amount is drawn from your checking or savings account or added to your credit card balance = the right under federal law to have the error resolved. Money from somewhere else = you might not have same legal protections - instead, you might have to rely on service provider's policies or state laws. Find out what user agreement says will happen if something goes wrong.

What if the wrong person or wrong amount is paid?

Ask her financial institution which ATMs are free to use.

When Emma withdraw money from her checking account at ATMs, she charged multiple fees. This makes it hard to keep track of her balance and pay her bills. What can Emma do? How would you suggest Emma manager account?

Overdraft

When an account transaction goes through, but not enough money in your account to cover it

yes

Who is Simone earn interest on her money in a savings account? yes or no

ATM Cards and Debit Cards

You decide if you want to opt-in to a program to cover certain overdrafts

Mobile wallet

You enter information from your cards into the app and used your mobile device to make point-of-sale purchases, like at a store or some restaurants.

Overdraft

Your account doesn't have enough money to cover the bill is an example of...

Debit Cards

called check cards

Overdraft

check

Debit Cards

conduct ATM

Overdraft

debit card purchase

App for P2P payments

handle money transactions with other people

Recurring ------>

happens repeatedly according to a schedule you select

Overdraft

it's for more money than is in your account

Debit Cards

make purchases

Debit Cards

money generally comes directly out of your checking account

Debit Cards

network logo

Debit Cards

not credit cards

Debit Cards

transaction