Personal Finance: Chapter 5

share accounts **

Audi credit union do you saving plans

annual percentage yield (APY) **

The percentage rate expressing the total amount of interest that would be received on a $100 deposit. We don't need to calc it but (interest/principal). AMOUNT OF INTEREST A SAVER SHOULD EARN! This is based on a $100 deposit for 365 day period

Money market fund **

The savings and lesson plan offered by investing companies with earnings based on investments and very short-term financial instruments.

Savings**

Time deposits

Commercial bank **

a financial institution that offers a full range of financial services to individuals business and government agencies. They chartered have a few regulations then the federal chartered banks.

Share draft account

an interest-bearing checking account at a credit union. So credit union members write checks (share drafts) against their account balances

Cash availability and payment services**

demand deposits

money market account**

is a savings account that requires a minimum balance earnings based on market interest rates

Credit unions **

A user owned nonprofit cooperative financial station that is organized for the benefit of its members. Usually have a common bond with the community. As the common bond restrictions were loosen membership of credit unions have increased.

Overdraft protection

An automatic loan made to checking account customers to cover the amount of checks written in excess of the available balance in the checking account.

Mutual savings bank **

a financial institution that is owned by depositors specializes in savings accounts and mortgage loans. The profits of mutual savings banks go to depositors usually paying higher rates on savings.

******Liquidity

allows you to withdraw your money on short notice w/o principal or fees

Rate of return **

% of increase in the value of saving as a result of interest earned (can be called the yield)

Trust**

a legal agreement that provides for the management and control of assets by one party for the benefit of another.

Debit card **

a plastic access card used in computerized banking transactions

Compounding**

a process that calculates interest based on previously earned interest. Future and present value take these calculations into account

Automatic teller machine **

the cash machine to conduct banking transactions.

Savings and loan associations **

He financial institution the traditionally specializes in savings accounts and mortgage loans. While commercial banks traditionally served businesses and individuals with large sums of money.

Certificate of deposit [CD]**

is a savings plan requiring that it a certain amount be left on deposit for a stated time.

Asset management account **

provides financial services (borrowing, checking ect) for a single fee.