Just like any other business, a financial service provider sells products to earn money so that it can run its operations and provide services. To understand how financial service providers operate, know that when you deposit money with them, it gets pooled into a shared fund along with everyone else's.
Financial Institution Basics
Security
Keeping your money in cash puts it at greater risk for theft or loss. The U.S. government protects money you deposit in the bank. A single fund account is insured for up to $250,000 by the Federal Deposit Insurance Corporation (FDIC), which will typically reimburse your insured deposits the next business day. That means you're able to keep your funds safe without having to worry about them being at risk.
Convenience
Money in the bank can be accessed from anywhere, whether it's online, through an ATM, or just a call to your bank's customer service department. With a bank account, you can arrange for your employer to directly deposit your paycheck automatically into your account, so it's easier and faster for you to get paid.
Budgeting
Reviewing a bank statement — a record of the balance in your bank account and the amounts that have been paid into it and withdrawn from it — makes it easier to manage your finances and stick to a budget. With bank statements, you'll know exactly where your money is going, whether it is toward a car payment or your night out with friends.
Making More Money
Banking allows you to make money with your money. It may sound too good to be true, but with interest, you can earn simply by depositing funds into an account. The bank pays you a percentage of interest on your balance, which is added directly to your account on a monthly basis.
Banking Tutor
In order to manage your money wisely, you'll need to know how to read and fill out the relevant paperwork. These brief tutorials will guide you through a few of the most frequently used items.
Making a Deposit
You have to deposit money in your bank account if you want to take it out. This tutorial will show you how to fill out a deposit slip.
Checks List
If you are depositing a check, write the check number for the top right corner of the check.
Total From Other Side
If you are depositing more checks than can be listed on the front, continue to list them on the back and write the total amount of the checks from the back side here.
Less Cash Received
If you would like the bank teller to give you cash back from your deposit, insert that amount in this field.
Name
Your personal information is printed here. Never list your social security number on your printed checks.
Check Amount in Numbers
Write the amount of the check numerically. Do not leave any space before the check amount where extra digits could be inserted.
Check Amount in Words
Starting at the far left side of this field, write the check amount in words. follow the dollar amount with the word "and" before writing the amount of cents over 100 in the form of a fraction. Draw a line from there to the end of the field.
Memo
Use this space to note the purpose of the check. If you are paying a bill, you might wish to put your account number here.
Identification Numbers
These numbers are used to identify the bank, your account number and the check number. They are printed in special magnetic ink that machines can read.
Endorsing a Check
Signing the back of a check is called "endorsing" the check. There are three ways to endorse a check.
Transaction Register
Use a transaction register to keep track of payments (by check or debit card) or deposits you make in your account.
Starting Balance
Record your starting account balance here. When the page is full, carry the bottom balance oer to the starting balance on the next page.
Recording a Check
Record the check number, date, to whom the check was written, the amount of the check and the reason the cehck was written. Subtract the amount of the check from your balance and write in the new balance.
Recording a Deposit
Record the code, date, description and the amount of the deposit. Add the amount of the deposit to your balance and write in the new balance.
Reading a Bank Statement
To keep track of where your money goes and how much you have, it's important to know how to read a bank statement. This explains the information it contains.
Account Summary
This area displays your previous balance, total deposits, total withdrawals and your new balance.
Checks and Other Debits
This section lists all transactions in which money was withdrawn from your account.
Deposit and Other Credits
This section lists all transactions in which money has been deposited in your account.
Reading a Credit Card Statement
Learning how to read your credit card statement will help you to effectively manage your credit usage.
Statement Date
All transactions occurring between the last statement date and this date appear on this statement.
New Balance
This is the current balance you owe on the card. You can pay the full amount and pay no interest. You can also pay a lesser amount and pay interest.
Transaction List
This area lists all the transactions you've made during the statement period. It includes perchases, returns, payments and interest charges.
Payment Information
This section shows your current balance, if there is any remaining balance from past statements, if you've spent past your credit limit and the minimum amount you must pay.
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