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25_Chapter_29_Checking_Accounts

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					Aim: What Are The Features
   Of A Checking Account?

       DO NOW: What do you
      think are the advantages
     of using checks instead of
                cash?
     Opening an Account
Checking accounts are sometimes
called demand deposits because
each check a customer writes is an
order to the bank to release money
from the account on demand.
      Types of Accounts
Most banks offer several types of
checking accounts.
A wise consumer investigates all the
kinds of accounts available, as well as
their advantages and costs.
      Regular Account
A regular checking account is
designed for customers who write a
few checks each month and don’t
keep a minimum amount of money in
the account.
       Regular Account
Some accounts require a minimum
balance.
If the balance falls below the minimum,
a service charge is deducted from the
account.
  Interest-Bearing Account
An interest-bearing account is a
checking account that earns interest
on your account’s balance.
  Interest-Bearing Account
An interest-bearing account usually
has a minimum balance requirement
with an unlimited number of checks
allowed each month.
 Interest-Bearing Account
The minimum balance might be much
higher than for a regular checking
account.
        Joint Account
A joint account is an account shared
by two people who are equally
responsible for the account.
With a joint checking account, either
person can write checks on the
account.
Figure
 29.1    TYPES OF CHECKING ACCOUNTS


                                 This chart shows the
                                 different types of checking
                                 accounts available at one
                                 bank.

                                 Which type of account
                                 requires the smallest
                                 amount of money to
                                 open?
       Signature Card
A signature card is a record of your
signature used by the bank to verify
your identity.
The signature card helps prevent other
people from cashing your checks.
        Signature Card
The signature you put on your card is
the same one you have to use when
you sign your checks.
  Fast Review

1. What is an advantage and a
   disadvantage of an interest-bearing
   account?

2. What is the main purpose of a
   signature card?
 Online Activity
     Log onto MrCohenOnline.com
Select the activity associated with lesson
                     29

           Banks to compare
             Citibank.com
               PNC.com
              Chase.com
          BankofAmerica.com

      I will explain the instructions.
       Overdraft Protection
One risk of having a checking account
is writing checks for more money than
you have in your account, or
overdrawing your account.
       Overdraft Protection
Banks charge a fee for a returned
check.

The business you wrote the check to
will probably also charge a fee.
       Overdraft Protection
Overdraft protection is a line of credit
for overdrawn checks.
You pay a service fee for the overdraft
protection and interest on the
overdrawn amount until it is repaid.
          Stop Payment
A stop payment is an order for a bank
not to cash a particular check.

Banks charge a fee to stop payment
on a check.
             Debit Cards
A debit card is like a credit card but
money is taken directly from your
checking account when you use it
rather than charging the amount to a
credit account.
         Online Checking
Online banking allows you to check
your accounts, transfer money, or pay
bills at any time of the day over the
Internet.
Online Bill-Paying
CheckFree provides the online bill-paying
service for the majority of the United States’
largest banks. It works with the banks that
want to provide online bill paying for their
customers.
                                      continued
Online Bill-Paying
CheckFree has little competition since others
don’t want to build the required complex
computer system.



                                    continued
Analyze
What other vendors could CheckFree build
relationships with in order to be successful?
         Online Checking
Online checking is less expensive for
banks, so service fees are often lower
than a traditional account.
         Online Checking
Banks offer the option of scheduling
automatic payment of your bills from
your checking account.
   Fast Review

1. What happens if a customer has
   insufficient funds in a checking
   account to pay a check?

2. How is a debit card different from a
   credit card?
When you write a check at the
store, what do you think the store
does with it?

                           continued
What do you think an intermediary
bank does?
What’s the purpose of the routing
number on a check?
                          continued
How do you know when a check
has cleared?
End of Chapter 29
Checking Accounts