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