banking services

Convenience

:How many checks do you think you will write every month? :Do you want a bank that is close to your home or work? :What are the bank's hours of operation? :Will you use the ATM often? :Does the bank have ATMs close to where you live or work? :How often do you plan to visit the bank to use teller services? :What other bank services are important to you?

Cost

:How much money will you keep in your account? :Will you be charged for writing extra checks? :Are you willing to pay a monthly fee? If so, how much? :Will you be charged to use your bank's ATM? :Will you be charged for using other banks' ATMs? :Will you be charged for using teller services? :Are there ways to avoid paying fees?

Overdraft Fee

Also called non-sufficient funds (NSF) fee. Expensive fees apply when you bounce a check. The bank will notify you if a check is returned to the person or company to whom it was issued because there were insufficient funds in the account. Your bank will charge a processing fee to your account because of the cost to return the check. Merchants might also charge a fee if a bounced check is used to purchase goods or services. The fee charged is usually posted near the cashier.

Returned Deposit Item

Banks might charge a fee if a check you deposit in your account bounces.

Free/Low-Cost Checking

If you do not plan to write many checks, a free or low-cost checking account might be right for you. The charge for a low-cost checking account is often no more than $5 per month. However, there may be a limit to the number of checks you can write.

Stop-Payment Fee

If you lose a check or need to make sure a check is not paid by the bank for some other reason, you can request a "stop payment." There is a fee for this service, and the bank might not be able to catch the check before it is paid.

Regular Checking

With a regular checking account, there is usually a minimum balance required to waive the monthly service fee. This type of account usually offers unlimited check writing privileges.

Check Printing Fee

You can buy checks from the bank or through the mail from other companies. If you buy checks from the bank, the charge for printing the checks is usually automatically deducted from your checking account. Fancy checks cost more than basic checks. You can buy more than one box at a time. Carbon copy checks are an option.

ATM-Use Fee

You might be charged each time you use the ATM at your bank or each time you use an ATM at a bank other than your own.

point-of-sale transactions

acceptance of ATM/debit card at retail stores and restaurants for payment of goods and services.

check-deferral services

allow consumers to get a cash advance on their next paycheck. However, these short-term loans are very expensive. A $200, two-week advance may cost over $30 (with annual costs exceeding $900).

automatic teller machines

allow customers to obtain cash and conduct banking transactions; some ATMs sell bus passes, postage stamps, gift certificates, and mutual funds.

online banking

banking through online services. Bank websites allow customers to check balances, pay bills, transfer funds, compare savings plans, and apply for loans online.

Location

branch offices; hours of operation; availability of ATMs

check-cashing outlets

charge high fees (sometimes 2 or 3 percent) just to have a paycheck or government check cashed.

pawn shops

charge very high interest for loans based on the value of tangible assets (such as jewelry or other valuable items).

electronic cash...

companies are developing electronic replicas of all existing payment systems—cash, check, credit cards, and coins.

special features

direct deposit; automatic payments; overdraft protection; online banking; discounts or free checking for students, seniors, or employees of certain companies

direct deposit

earnings (or government payments) automatically deposited into bank accounts, saving time, effort, and money.

restrictions

minimum balance; deposit insurance; holding period for deposited checks

interest rate earned

minimum deposit to earn interest; compounding method; fee charged for falling below necessary balance

fee

monthly fees; per check fees; printing of checks; balance inquiry fees; ATM fees

other charges

monthly fees; per check fees; printing of checks; balance inquiry fees; ATM fees

rent to own

offer an opportunity to obtain home entertainment systems or appliances for a small weekly fee. However, the amount paid for the item usually far exceeds the cost if the item were bought on credit.

stored-value cards...

prepaid cards for telephone service, transit fares, highway tolls, laundry service, library fees, and school lunches.

rapid-refund tax services

provide "instant refunds" when you pay to have your federal tax return prepared. However, this "instant refund" is a loan with interest rates as high as 120 percent.

smart cards

sometimes called "electronic wallets," look like ATM cards; however, they also include a microchip. This minicomputer stores prepaid amounts for buying goods and services. A smart card can also store data about a person's account balances, transaction records, insurance information, and medical history. Uses for smart cards may expand in the future.

automatic payments

utility companies, loan payments, and other businesses use an automatic payment system with bills paid through direct withdrawal from a bank account.

Monthly Service Fee

Also called a maintenance fee. The bank might charge a fee each month just for having the account. You might also be charged a fee if your balance drops below the required minimum.

Per Check Fee

Some accounts charge a fee for each check you write. Depending on the account, you might pay the fee for each check or only when you write more than a certain number of checks (perhaps five) a month.

Phone Inquiry Fee

Some banks charge a fee if you call to check your balance or to see if a check or deposit has cleared.

Teller Fee

Some banks may charge a fee if you use a teller to make deposits or withdrawals more than a set number of times each month. Banks that charge this fee do so to encourage you to use an ATM for your basic banking transactions.

Fee for Helping You Balance Your Checkbook

Some banks will help you balance your checkbook. Others might charge you for this service.

interest-Bearing Checking

There are also different interest-bearing accounts: The Negotiable Order of Withdrawal (NOW) account. The Money Market Deposit Account (MMDA). With these accounts, you usually have to maintain a high minimum balance in order to earn interest and avoid fees. The minimum balance is usually at least $1,000.

Electronic/ATM Checking

This account usually requires you to use direct deposit. If you do not plan to use teller services often, an electronic checking account might be right for you. This type of account usually allows you to write an unlimited amount of checks per month without incurring a fee for each check you write. However, you may be charged for in-person teller services.