Bank Accounts
This account is used for everyday transactions and allows you to write checks and use a debit card.
Checking Account
Experts recommend you save 3–6 of these in an emergency fund.
Months of expenses
Using this card pulls money directly from your checking account.
debit card
This government program protects bank deposits up to $250,000.
FDIC Insurance
This is what “living paycheck to paycheck” means.
having no savings and just barely covering monthly expenses
This type of savings option locks in your money for a set period of time in exchange for a higher interest rate.
CD
The budgeting rule that splits income into 50% needs, 30% wants, and 20% savings.
50/30/20 rule
Apps like Venmo and CashApp are examples of these types of payment tools.
peer to peer
If Jocelyn notices suspicious ATM withdrawals on her account, she should do this right away.
contact her bank immediately
Direct deposit refers to your employer sending this directly to your account.
Paycheck
These are fees banks charge if you spend more than you have in your account.
Overdraft
Saving a certain percentage of every paycheck right away is an example of this saving strategy.
Pay yourself first
This type of prepaid card is often used by unbanked people but usually comes with many fees.
prepaid card
One reason why it is important to check your bank statements regularly.
catch errors or fraud?
If inflation is higher than your savings account interest rate, you are losing this.
purchasing power
Customers typically receive this type of document once a month summarizing their checking account activity.
Bank statement
Joelle earns $4,000 gross per month, spends $2,000 monthly, and saves 10%. It will take her this long to save a 6-month emergency fund.
24 months
With overdraft coverage turned OFF, this happens if you try to spend more than you have in your account.
card gets denied
This type of banking allows you to transfer funds, pay bills, and automate savings without visiting a branch.
online banking
One fee banks charge on checking accounts and how you can avoid it.
overdraft fee (avoid by monitoring balance) OR ATM fee (avoid by using your bank’s ATMs)
Online savings accounts are often preferred over traditional bank accounts because of this feature.
Higher Interest Rate
One reason why it is important to start saving for retirement early.
compound interest
money grows more over time
This type of transaction reduces your checking account balance immediately.
using a debit card at checkout
One con of being paid with a payroll card.
high fees / limited access compared to direct deposit
Name one pro and one con of payroll cards.
Pro: useful without a bank account; Con: high fees.