Checking & Accounts
This document shows all transactions in your account, usually sent monthly.
Bank statement
What does FDIC insurance protect?
deposits up to $250,000 per depositor, per insured bank.
According to the 50–30–20 rule, what percentage goes to savings?
20%
What is a digital wallet? Give one example of when someone might use it.
A digital wallet stores card info on a device for contactless payments (e.g., Apple Pay used at a store checkout).
True or False: You can deposit a check by taking a photo with your banking app. Explain briefly.
True — mobile deposit lets you deposit checks by photographing them in many banking apps.
Name two common methods to deposit money into a checking account.
direct deposit; mobile deposit; ATM deposit; deposit at branch.
Name one monthly fee some banks charge just for keeping an account open.
Monthly maintenance fee (monthly service fee).
Define the “Pay Yourself First” strategy and one advantage.
Automatically transfer a set amount into savings each pay period; advantage: ensures consistent saving before spending.
List two advantages of mobile or online banking.
check balances anytime, mobile deposit, set up automatic transfers, online bill pay.
Name one fee you could avoid by using only in-network ATMs.
ATM out-of-network fee.
Explain the main difference between a checking account and a savings account in one sentence.
Checking is for everyday access and transactions; savings is for storing money to earn interest and may limit withdrawals.
Give three strategies you can use to avoid bank fees.
Set up alerts, use in-network ATMs, choose accounts with no/waived fees, maintain minimum balance.
How many months of expenses do experts recommend keeping in an emergency fund?
3-6 months of expenses
Give two CONS of peer-to-peer (P2P) payment apps.
Security risks/scams; limited recourse to recover mistaken payments; possible fees for certain transactions.
Using the 50–30–20 rule, what category does "wants" correspond to and what percent?
Wants — 30%
Certificate of Deposit — what is the primary tradeoff?
Higher interest rates but funds are locked for a set time; early withdrawal may incur penalties.
If you opt in to overdraft protection and your balance is $10, then you make purchases totaling more than $10, what likely happens?
The bank may cover transactions, but you’ll be charged one or more overdraft fees and must repay the negative balance.
If someone saves 20% of a $2,750 monthly income toward an emergency fund, how much is saved each month?
$550 per month
Online banking automatically waives all overdraft, ATM, and maintenance fees.
False — online banking does not automatically waive fees; you must check account terms.
If your savings account earns 2% interest but inflation is 4% this year, explain what happens to your money’s purchasing power and recommend one action to help protect savings.
Your purchasing power decreases because prices are rising faster (4%) than your savings are growing (2%), so your money can buy less over time; consider finding savings or investment options with higher returns (e.g., a higher-yield savings account, CDs, or diversified investments) or adjust savings goals to aim for a rate above inflation.
Describe compound interest and why starting earlier helps your savings.
Compound interest is interest earned on principal and on previously earned interest. Starting earlier gives more time for interest to compound, increasing total growth.
Describe two ways checking and savings accounts differ in fees or access and why banks set those differences.
Checking often allows unlimited transactions but may have maintenance fees; savings may limit withdrawals and pay interest because banks lend out saved funds.
Iliza wants an $11,000 emergency fund and saves $550 per month. How many months will it take?
20 months
List three mobile/online features students should use to manage accounts securely and effectively.
Low-balance & unusual-activity alerts, mobile deposit, online bill pay, automatic transfers.
If a student has $45, buys $20 and $15 with a debit card, then attempts a $12 purchase and they opted out of overdraft protection, will the $12 charge go through? Explain and state whether a fee applies.
No — the $12 charge will likely be denied because account balance is insufficient, and if opted out of overdraft protection, they should not be charged an overdraft fee.