INTRODUCTION TO DEPOSITORY INSTITUTIONS Advanced Level

Page 1 2.2.1 INTRODUCTION TO DEPOSITORY INSTITUTIONS Advanced Level www.takechargetoday.arizona.edu RECOMMENDED GRADE LEVELS 10 12 AVERAGE TIME TO COMPLETE Anticipatory Set & Facilitation: 100 105 minutes Conclusion/Assessment Options: 15 60 minutes Time does not include optional items. EACH LESSON PLAN IS DESIGNED AND CONTINUALLY EVALUATED BY EDUCATORS, FOR EDUCATORS. THANK YOU TO THE FOLLOWING EDUCATORS FOR DEVELOPING COMPONENTS OF THIS LESSON PLAN. Tracey Newman, Family and Consumer Sciences Educator, Ste. Genevieve, Missouri Amy Broekhuizen, Family and Consumer Sciences Educator, Kentwood, Michigan Kathie Beck, Family and Consumer Sciences Educator, Holland, Michigan NATIONAL STANDARDS The curriculum is aligned to the following national standards: National Standards for Financial Literacy American Association of Family and Consumer Sciences Council for Economic Education National Business Education National Jump$tart Common Core English Language Arts LESSON PLAN OBJECTIVES Upon completion of this lesson, participants will be able to: Analyze the benefits of using a depository institution Research services offered by different depository institutions Summarize factors to consider when choosing a depository institution MATERIALS PROVIDED IN THIS LESSON PLAN Alike but Different 2.2.1.A1 Agree or Disagree? 2.2.1.A2 Josie s Depository Institution Comparison Chart 2.2.1.A3 Help Josie Choose a Depository Institution 2.2.1.A4 What Do You Know About Depository Institutions? 2.2.1.A5 Depository Institution Research 2.2.1.A6 Depository Institution Advertisement 2.2.1.B1 Depository Institution Research Rubric 2.2.1.B2 Introduction to Depository Institutions Vocabulary List 2.2.1.E1 MATERIALS MATERIALS SPECIFIC TO THIS LESSON PLAN BUT AVAILABLE IN A SEPARATE DOWNLOAD Introduction to Depository Institutions Answer Key 2.2.1.C1 Introduction to Depository Institutions PowerPoint Presentation 2.2.1.G1 Introduction to Depository Institutions PowerPoint Presentation 2.2.1.G2 Managing Your Money Unit Multiple Choice Test Bank and Answer Key 2.2.0.M1 & C1 MATERIALS TO ACQUIRE SEPARATELY DEPENDING ON OPTIONS TAUGHT Computer access and/or Internet access Large pieces of paper (1 per 2 5 participants) Colored paper Crayons, colored pencils, markers, etc. Material List Continued on Page 2

Page 2 2.2.1 Depository Institution Advertisement Examples 2.2.1.E2 Introduction to Depository Institutions Information Sheet 2.2.1.F1 Help Josie Choose a Depository Institution Scavenger Hunt Cards 2.2.1.H1 Introduction to Depository Institutions Note Taking Guide2.2.1.L1 RESOURCES EXTERNAL RESOURCES External resources referenced in this lesson plan: Katrina s Classroom: Financial Lessons from a Hurricane: www.frbatlanta.org/forms/katrina_aftermath.cfm The Fed Explains Regional Banks videos www.federalreserveeducation.org/resources/detail.cfm?r_id=83165294 571e 4940 af70 8939434adb28 Find A Better Bank: www.findabetterbank.com Elderly Man Accidently Gives Life Savings to Goodwill article: http://abcnews.go.com/blogs/headlines/2011/11/elderly man accidentally gives life savings to goodwill/ Consumer Jungle student oriented website: www.consumerjungle.org Similar lesson plan at a different level: Depository Institution Discovery 1.2.1 Electronic Banking Bonanza 1.2.2 Checking Account and Debit Card Simulation 1.2.3 TAKE CHARGE TODAY RESOURCES Optional lesson plan resources: Technology Integration Options Active Learning Tool 3.0.50 Financial Facts Feud Active Learning Tool 3.0.19 Tablets Applications for the Personal Finance Classroom Active Learning Tool 3.0.52 EDUCATOR MATERIALS Materials to support educators when preparing to teach this lesson plan are available on the Take Charge Today website. CONTENT LESSON FACILITATION PARTICIPANT READING Introduction to Depository Institutions Information Sheet 2.2.1.F1 PREPARE Visual indicators to help prepare the lesson INSTRUCT Instructions to conduct the lesson facilitation VOCABULARY ACTIVITY Alike but Different Approximate time: 10 minutes prior to instruction and 15 minutes at the end Materials to prepare: 1 Alike but Different 2.2.1.A1 per participant Before instruction: CUSTOMIZE Potential modifications to lesson facilitation

Page 3 2.2.1 1. Provide each participant with Alike but Different 2.2.1.A1. 2. Instruct participants to write what they think the definition of each word is in the spaces provided. 3. Conduct the lesson facilitation. After instruction: 4. At the end of the facilitation have participants complete the remainder of the Alike but Different 2.2.1.A1 by identifying how each set of terms are similar and different. Instruct participants to edit their definitions if they are wrong. For the definition of each word in the Alike but Different 2.2.1.A1 have participants tweet the definition by encouraging 140 characters or less. ANTICIPATORY SET OPTIONS There are two anticipatory set options provided for this lesson: 1. Option one: Agree or Disagree? 2. Option two: Katrina s Classroom: Financial Lessons from a Hurricane Option 1: Agree or Disagree? Approximate time: 5 minutes at the beginning of instruction and 5 minutes at the end of instruction Materials to prepare: 1. 1 Agree or Disagree? 2.2.1.A2 per participant Before instruction: 2. Provide each participant with an Agree or Disagree? 2.2.1.A2. 3. Instruct participants to complete the Before section by determining whether they agree or disagree with each statement. 4. After determining if they agree or disagree, they should explain why that choice was made in the comment section. After instruction: 5. At the end of the lesson facilitation, have participants complete the After section to determine if their views regarding depository institutions have changed during the course of the lesson. a. A bank can help me positively manage my money. i. Agree Using a depository institution has many benefits that can help a person manage their money. b. I trust that my money is safe if I store it in a bank. i. Agree One of the most important services a depository institution offers is a safe and secure place to store your money due to security and insurance. c. My money has the possibility to increase in value if stored at a bank. i. Agree If you store your money in an interest earning account it will increase in value. Option 2: Katrina s Classroom: Financial Lessons from a Hurricane Approximate time: 15 minutes Materials to prepare: Katrina s Classroom: Financial Lessons from a Hurricane video In the Aftermath (link available in the supplemental resources section) 1. The Federal Reserve Bank of Atlanta s series Katrina s Classroom: Financial Order a free DVD of the Katrina s Classroom videos from the Federal Reserve Bank of Atlanta website.

Page 4 2.2.1 Lessons from a Hurricane series consists of four different videos. For this activity, it is recommended to watch the second video in the series called In the Aftermath. This video is 6:32 minutes. 2. Explain to participants that they are going to watch the story of Nick, a young man whose family fled from New Orleans during Hurricane Katrina. Ask participants to pay attention to how Nick and his family were able to get money while they were away from home. 3. Show the video In the Aftermath. 4. After the video hold a class discussion. Have participants think about how using a depository institution helped Nick and his family. The following discussion questions may be used: a. What would the family have done in the aftermath of Hurricane Katrina if they didn t have a bank account? b. What would have happened if the family stored their money at home and was unable to return home to retrieve it before the hurricane destroyed their house? c. What ways did Nick s mom prepare the family for a natural disaster? d. Why did Nick open a bank account of his own? e. From watching this video, what are benefits of having a bank account? f. If the family hadn t been victim to a natural disaster do you think they would still benefit from having a bank account? RECOMMENDED FACILITATION There are two facilitation options provided for this lesson: 1. Option one: PowerPoint Presentation With Josie Throughout 2. Option two: PowerPoint Presentation with Josie at the End Option 1: PowerPoint Presentation with Josie Throughout Approximate time: 90 minutes Materials to prepare: Introduction to Depository Institutions PowerPoint Presentation 2.2.1.G1 1 Josie s Depository Institution Comparison Chart 2.2.1.A3 per participant 1 set of Help Josie Choose a Depository Institution Scavenger Hunt Cards 2.2.1.H1 1. Split participants into groups of 2 5 to conduct group discussion and brainstorming throughout the lesson. 2. Present the Introduction to Depository Institutions PowerPoint Presentation 2.2.1.G1. Part 1: What is a Depository Institution? 3. Slide 1: Introduction 4. Slide 2: What is a Depository Institution? a. The term depository institution may be unfamiliar, but they have probably heard of a bank. A bank is a type of depository institution. b. Ask participants to name one depository institution in their community. 5. Slide 3: Meet Josie a. Describe Josie and explain that she is looking for a depository The Introduction to Depository Institutions Note Taking Guide 2.2.1.L1 is provided but not included as part of the recommended facilitation instructions or approximate time. Write the names of the depository institutions in your community on the board and refer to them throughout the rest of the facilitation.

Page 5 2.2.1 institution to keep her money safe and pay her bills when she starts college next year. 6. Slide 4: Help Josie manage her money by choosing a depository institution a. Hand one Josie s Depository Institution Comparison Chart 2.2.1.A3 to each participant. b. Josie has found two depository institutions with branches in her hometown and near the college she will be attending. c. She has summarized the information for both of these depository institutions in the Josie s Depository Institution Comparison Chart 2.2.1.A3 to help her make an informed decision. d. Their mission is to learn more about Josie and about depository institutions to help Josie determine which depository institution she should choose to use. Part 2: Types of Depository Institutions and Location 7. Slide 5: Types of Depository Institutions a. Stress that there are multiple types of depository institutions. Commercial banks and credit unions are the two most common. b. Although each type of depository institution is a little different, they are often referred to as banks. c. Each type of depository institution is unique, so they should choose the type that works best to help them manage their money. 8. Slide 6: Josie a. Refer participants to the Josie s Depository Institution Comparison Chart 2.2.1.A3. b. Have participants work within their groups to analyze the chart to determine if Josie s depository institutions options 1 and 2 are credit unions or banks. c. Have each group share their answers making sure they provide at least one reason for their choice. d. Discuss the answers. i. Option 1 is a bank because it is open to anyone. ii. Option 2 is a credit union because it has membership requirements (members must be a family member of a particular railroad system employee). 9. Slide 7: Location a. In addition to determining which type of depository institution is the best match, a person may also want to consider the location of a depository institution. b. Refer back to the depository institution in your community identified on slide 2. Ask participants if that depository institution has more than one branch. 10. Slide 8: Josie a. Ask participants to determine how Josie considered location when choosing her top two depository institutions. Show a video clip from the movie It s a Wonderful Life to illustrate how banks work. Learn how the center bank s structure helps form a big picture view of the United States economy by watching The Fed Explains Regional Banks videos available on the Federal Reserve Bank website. Part 3: Depository Institution Insurance 11. Slide 9: Depository institutions keep your money safe a. One of the most important services a depository institution offers is a

Page 6 2.2.1 safe and secure place to store money. b. Part of this security is offered by the bank itself in terms of having security features such as safes and storing data on a secured network. However, the other part of this security is offered by depository institution insurance. c. Discuss FDIC and NCUA insurance noting that the only difference is that FDIC covers all types of depository institutions except for credit unions. Since credit unions are a not for profit business they are covered by their own type of insurance. d. Ask participants to determine how insurance can play a role in choosing a depository institution. i. Tell participants that the majority of depository institutions are insured but there are some that are not insured. Therefore, before depositing your money into a depository institution account, make sure to ask if that depository institution is insured. 12. Slide 10: Josie a. Have participants refer to the Josie s Depository Institution Comparison Chart 2.2.1.A3 and work within their groups to determine if Josie s choices are insured. b. Discuss the correct answers. Insurance coverage is another clue to what type of depository institution option 1 and 2 are (option 2 is a credit union because it is covered by NCUA insurance). Part 4: Depository Institution Services 13. Slide 11: Businesses offer services to the public a. Assign each group one of the businesses listed on slide 11. b. In the first section, ask participants to brainstorm what type of services their business offers to the public. i. For example, a gas station provides fuel, snacks, and limited groceries. c. Allow a few minutes for participants to brainstorm services and then ask a few groups to share what services their business type provides. 14. Slide 12: Services offered by depository institutions a. Depository institutions are business just like gas stations, grocery stores, restaurants and clothing stores that provide services to the public. b. Have participants brainstorm what types of services the depository institution in their community offers to the public. c. Explain that depository institution services can be divided into five categories. 15. Slide 13: Depository institutions offer the ability to earn interest a. Discuss the definitions of interest and interest rates. b. Stress that a person may earn or be charged interest. When depositing money at a depository institution you may earn interest, which is another benefit of using a depository institution. 16. Slide 14: Savings Tools a. Savings tools are one type of service a depository institution offers. Savings tools help people manage their money by decreasing the To reinforce the concept of keeping money safe in a depository institution, discuss the article regarding a man who accidently gave his life savings to goodwill. A link to one article is available in the supplemental resources section of this lesson. Use the Savings Tools Lesson Plan 2.4.3 to further explore features of savings tools. Further explore the concept of depository institutions by reading articles on the studentoriented Consumer Jungle website.

Page 7 2.2.1 need to carry large amount of cash. b. Although there are many different types of savings tools, checking accounts and savings accounts are the most common types. 17. Slide 15: Checking Account vs. Savings Account a. Discuss the function of checking and savings accounts and how they differ from each other. b. Ask participants if they should look for a high or low interest rate on a savings account. Discuss that they should look for a high interest rate because the higher the interest rate the more interest they will earn. 18. Slide 16: Josie a. Josie is looking for both a checking account and a savings account. She would like a checking account that is linked to her savings account so she can transfer money into her savings account whenever needed. b. Have participants review their Josie s Depository Institution Comparison Chart 2.2.1.A3 and determine if both depository institution options have this ability. Both options do have the ability for a linked savings account. c. Ask participants to determine why having a checking account linked to a savings account would be beneficial. 19. Slide 17: Credit a. If money is borrowed from a depository institution the borrower has to pay back the money borrowed plus interest. 20. Slide 18: Other Services a. Discuss financial advice, safe deposit boxes, and special needs payment instruments as other services that may be offered by depository institutions. 21. Slide 19: Using depository institution services a. If you want to use a depository institution service you should determine what steps are needed to use that service by calling, visiting, emailing, or researching online. b. A person may be required to have an account at a depository institution in order to use other services. For example, most depository institutions won t cash a check unless you have an account with them. c. If you are under the age of 18, in most cases you will need a parent/guardian signature to open an account at a depository institution. However, this does vary between depository institutions so ask about individual policies for those under 18. Part 5: Depository Institution Features 22. Slide 20: Features of Depository Institutions a. The services offered by depository institutions may offer certain features. 23. Slide 21: Online Banking a. Discuss online banking stressing that it may be used with many different services, such as savings tools and credit. 24. Slide 22: Mobile Banking a. Mobile banking is the same as online banking but it is an application

Page 8 2.2.1 that allows access from mobile devices such as smartphones and tablets. 25. Slide 23: Debit Cards a. A debit card has the same function as a check but it is electronic. b. Debit cards are common with checking and savings accounts. 26. Slide 24: ATM a. Stress that some number of ATMs available varies between depository institutions. 27. Slide 25: Contactless Payment a. If depository institutions offer contactless payment it will be used for debit and credit cards. 28. Slide 26: Cast your vote! a. Conduct a class survey to see which feature of depository institutions is the most popular. b. The vote could be conducted in a variety of ways: i. List each feature and have participants raise their hand to determine their vote. ii. Have a station for each feature around the room and instruct participants to move to the part of the room coordinating with their favorite feature. iii. If you have access to an interactive whiteboard, use the polling feature provided (if available). iv. Use an online poll creator or brainstorming/discussion tool to conduct the vote. Refer to the Technology Integration Options Active Learning Tool 3.0.50 for samples and instructions. c. Ask for volunteers from each group to explain why the feature chosen is their favorite. In addition to polling on the favorite feature, conduct a poll to determine which depository institution services and features participants already use (for example, checking accounts, debit cards, online banking, etc.). Part 6: Depository Institution Fees 29. Slide 27: Fees a. Depository institutions are a business and just as with any other business they may charge fees for certain services. b. There are many different types of fees that vary between depository institutions and within different services offered at the same institution. c. Discuss the example fees given stressing that these are only three examples; there are many other types of fees. 30. Slide 28: How do you manage fees? a. Discuss how with research and responsible management of accounts, most fees can be avoided. Part 7: Choosing a Depository Institution 31. Slide 29: How do you choose one depository institution over another? a. Discuss the factors to consider when choosing an institution that matches personal goals. 32. Slide 30: Which checking account should Josie choose? a. Print one copy of Help Josie Choose a Depository Institution Scavenger Hunt Cards 2.2.1.H1 and cut apart the eight cards. Instead of conducting a scavenger hunt, hand one or two cards to each group. Or, read the cards yourself.

Page 9 2.2.1 b. Before class, place the eight cards in different places around the room. c. Tell participants that there are eight cards hidden around the room that tell us more about Josie. In order to help her make a decision about which checking account to choose we need to find those cards. d. Send participants on a scavenger hunt around the room to find the cards. e. Once all eight cards have been found have participants return to their groups. f. Have each person who found a card read that card to the class. After each card is read allow time for participants to complete the instructions given. 33. Slide 31: What did you learn about Josie? a. Review the factors that they should consider when helping Josie choose option 1 or option 2 b. Have participants work within their groups to determine if they would recommend Josie choose option 1 or 2. c. Ask groups to share their choice and a brief explanation as to why they made that choice. Remind participants that there is no right or wrong answer. 34. Slide 32: Summary a. Review the major points of the lesson. Option 2: PowerPoint Presentation with Josie at the End Approximate time: 90 minutes Materials to prepare: Introduction to Depository Institutions PowerPoint Presentation 2.2.1.G2 1 Introduction to Depository Institutions Note Taking Guide 2.2.1.L1 per participant Optional: 1 Introduction to Depository Institutions Information Sheet 2.2.1.F1 per group of 2 5 1 Josie s Depository Institution Comparison Chart 2.2.1.A3 per participant 1 set of Help Josie Choose a Depository Institution Scavenger Hunt Cards 2.2.1.H1 Don t distribute the Josie materials until the end of the presentation. 1. Split participants into groups of 2 5 to conduct group discussion and brainstorming throughout the lesson. 2. Present the Introduction to Depository Institutions PowerPoint Presentation 2.2.1.G2. Part 1: What is a Depository Institution? 3. Slide 1: Introduction 4. Slide 2: What is a Depository Institution? a. The term depository institution may be unfamiliar, but they have probably heard of a bank. A bank is a type of depository institution. b. Ask participants to name one depository institution in their community. Part 2: Locations and Insurance

Page 10 2.2.1 5. Slide 3: Types of Depository Institutions a. Stress that there are multiple types of depository institutions. Commercial banks and credit unions are the two most common. b. Although each type of depository institution is a little different, they are often referred to as banks. c. Each type of depository institution is unique, so they should choose the type that works best to help them manage their money. 6. Slide 4: Location a. In addition to determining which type of depository institution is the best match, a person may also want to consider the location of a depository institution. b. Refer back to the depository institution in your community identified on slide 2. Ask participants if that depository institution has more than one branch. 7. Slide 5: Depository institutions keep your money safe a. One of the most important services a depository institution offers is a safe and secure place to store money. b. Part of this security is offered by the bank itself in terms of having security features such as safes and storing data on a secured network. However, the other part of this security is offered by depository institution insurance. c. Discuss FDIC and NCUA insurance noting that the only difference is that FDIC covers all types of depository institutions except for credit unions. Since credit unions are a not for profit business they are covered by their own type of insurance. d. Ask participants to determine how insurance can play a role in choosing a depository institution. i. Tell participants that the majority of depository institutions are insured but there are some that are not insured. Therefore, before depositing your money into a depository institution account, make sure to ask if that depository institution is insured. Part 3: Depository Institution Services 8. Slide 6: Businesses offer services to the public a. Assign each group one of the businesses listed on slide 6. b. In the first section, ask participants to brainstorm what type of services their business offers to the public. i. For example, a gas station provides fuel, snacks, and limited groceries. c. Allow a few minutes for participants to brainstorm services and then ask a few groups to share what services their business type provides. 9. Slide 7: Services offered by depository institutions a. Depository institutions are business just like gas stations, grocery stores, restaurants and clothing stores that provide services to the public. b. Have participants brainstorm what types of services the depository institution in their community offers to the public. c. Explain that depository institution services can be divided into five Use an interactive whiteboard application to complete the activity on slides 11 12 using tablets. Refer to the Tablets Applications for the Personal Finance Classroom Active Learning Tool 3.0.52.

Page 11 2.2.1 categories. 10. Slide 8: Depository institutions offer the ability to earn interest a. Discuss the definitions of interest and interest rates. b. Stress that a person may earn or be charged interest. When depositing money at a depository institution you may earn interest, which is another benefit of using a depository institution. 11. Slide 9: Savings Tools a. Savings tools are one type of service a depository institution offers. Savings tools help people manage their money by decreasing the need to carry large amount of cash. b. Although there are many different types of savings tools, checking accounts and savings accounts are the most common types. 12. Slide 10: Checking Account vs. Savings Account a. Discuss the function of checking and savings accounts and how they differ from each other. b. Ask participants if they should look for a high or low interest rate on a savings account. Discuss that they should look for a high interest rate because the higher the interest rate the more interest they will earn. 13. Slide 11: Credit a. If money is borrowed from a depository institution the borrower has to pay back the money borrowed plus interest. 14. Slide 12: Other Services a. Discuss financial advice, safe deposit boxes, and special needs payment instruments as other services that may be offered by depository institutions. 15. Slide 13: Using depository institution services a. If you want to use a depository institution service you should determine what steps are needed to use that service by calling, visiting, emailing, or researching online. b. A person may be required to have an account at a depository institution in order to use other services. For example, most depository institutions won t cash a check unless you have an account with them. c. If you are under the age of 18, in most cases you will need a parent/guardian signature to open an account at a depository institution. However, this does vary between depository institutions so ask about individual policies for those under 18. Part 4: Depository Institution Features 16. Slide 14: Features of Depository Institutions a. The services offered by depository institutions may offer certain features. b. Assign each small group to one feature (online banking, mobile banking, debit cards, ATMs or contactless payment). Each group must identify what their feature is, what you can do with it and one piece of additional information. i. If participants are familiar with depository institutions, have them complete this activity using their prior background knowledge. If they are unfamiliar with depository institutions, Have groups record their responses on butcher paper.

Page 12 2.2.1 give each group one Introduction to Depository Institutions Information Sheet 2.2.1.F1. c. Have groups share with the rest of the class and supplement the information shared with information on slides 15 19 if necessary. 17. Slide 15: Online Banking a. Discuss online banking stressing that it may be used with many different services, such as savings tools and credit. 18. Slide 16: Mobile Banking a. Mobile banking is the same as online banking but it is an application that allows access from mobile devices such as smartphones and tablets. 19. Slide 17: Debit Cards a. A debit card has the same function as a check but it is electronic. b. Debit cards are common with checking and savings accounts. 20. Slide 18: ATM a. Stress that some number of ATMs available varies between depository institutions. 21. Slide 19: Contactless Payment a. If depository institutions offer contactless payment it will be used for debit and credit cards. 22. Slide 20: Cast your vote! a. Conduct a class survey to see which feature of depository institutions is the most popular. b. The vote could be conducted in a variety of ways: i. List each feature and have participants raise their hand to determine their vote. ii. Have a station for each feature around the room and instruct participants to move to the part of the room coordinating with their favorite feature. iii. If you have access to an interactive whiteboard, use the polling feature provided (if available). iv. Use an online poll creator or brainstorming/discussion tool to conduct the vote. Refer to the Technology Integration Options Active Learning Tool 3.0.50 for samples and instructions. c. Ask for volunteers from each group to explain why the feature chosen is their favorite. Part 5: Depository Institution Fees & Choosing a Depository Institution 23. Slide 21: Fees a. Depository institutions are a business and just as with any other business they may charge fees for certain services. b. There are many different types of fees that vary between depository institutions and within different services offered at the same institution. c. Discuss the example fees given stressing that these are only three examples; there are many other types of fees. 24. Slide 22: How do you manage fees? a. Discuss how with research and responsible management of accounts, most fees can be avoided.

Page 13 2.2.1 b. Slide 23: How do you choose one depository institution over another? i. Discuss the factors to consider when choosing an institution that matches personal goals. c. Slide 24: Summary i. Review the major points of the lesson. Optional: Part 6: Josie 25. Slide 25: Meet Josie a. Describe Josie and explain that she is looking for a depository institution to keep her money safe and pay her bills when she starts college next year. 26. Slide 26: Help Josie manage her money by choosing a depository institution a. Hand one Josie s Depository Institution Comparison Chart 2.2.1.A3 to each participant. b. Josie has found two depository institutions with branches in her hometown and near the college she will be attending. c. She has summarized the information for both of these depository institutions in the Josie s Depository Institution Comparison Chart 2.2.1.A3 to help her make an informed decision. d. Their mission is to learn more about Josie and about depository institutions to help Josie determine which depository institution she should choose to use. 27. Slide 27: Josie a. Have participants work within their groups to analyze the chart to determine if Josie s depository institutions options 1 and 2 are credit unions or banks. b. Have each group share their answers making sure they provide at least one reason for their choice. c. Discuss the answers. i. Option 1 is a bank because it is open to anyone. ii. Option 2 is a credit union because it has membership requirements (members must be a family member of a particular railroad system employee). 28. Slide 28: Josie a. Ask participants to determine how Josie considered location when choosing her top two depository institutions. b. Slide 29: Josie i. Determine if Josie s choices are insured. ii. Discuss the correct answers. Insurance coverage is another clue to what type of depository institution option 1 and 2 are (option 2 is a credit union because it is covered by NCUA insurance). 29. Slide 30: Josie a. Josie is looking for both a checking account and a savings account. She would like a checking account that is linked to her savings account so she can transfer money into her savings account whenever needed. b. Determine if both depository institution options have this ability. i. Both options do have the ability for a linked savings account. c. Ask participants to determine why having a checking account linked Use the Help Josie Choose a Depository Institution 2.2.1.A4 worksheet instead of the PowerPoint to facilitate the Josie activity.

Page 14 2.2.1 to a savings account would be beneficial. 30. Slide 31: Which checking account should Josie choose? a. Print one copy of Help Josie Choose a Depository Institution Scavenger Hunt Cards 2.2.1.H1 and cut apart the eight cards. b. Before class, place the eight cards in different places around the room. c. Tell participants that there are eight cards hidden around the room that tell us more about Josie. In order to help her make a decision about which checking account to choose we need to find those cards. d. Send participants on a scavenger hunt around the room to find the cards. e. Once all eight cards have been found have participants return to their groups. f. Have each person who found a card read that card to the class. After each card is read allow time for participants to complete the instructions given. 31. Slide 32: What did you learn about Josie? a. Review the factors that they should consider when helping Josie choose option 1 or option 2 b. Have participants work within their groups to determine if they would recommend Josie choose option 1 or 2. c. Ask groups to share their choice and a brief explanation as to why they made that choice. Remind participants that there is no right or wrong answer. CONCLUSION OPTIONS There are two conclusion options provided for this lesson: 1. Option one: Financial Facts Feud 2. Option two: Depository Institution Advertisement Option 1: Financial Facts Feud Approximate time: 30 minutes Materials to prepare: Financial Facts Feud Active Learning Tool 3.0.19. o Feud Questions for Introduction to Depository Institutions Lesson Plan 3.0.19.K1 o Financial Facts Feud PowerPoint for Introduction to Depository Institutions Lesson Plan 3.0.19.G2. 2 taplights or buzzers at the front of the room set up for a face off 1. Conduct the Financial Facts Feud activity. This activity is similar to the television game show Family Feud. Instructions and questions for this activity are included in the Financial Facts Feud Active Learning Tool 3.0.19. Option 2: Depository Institution Advertisement Approximate time: 15 30 minutes depending upon the method used Materials to prepare: 1 Depository Institution Advertisement 2.2.1.B1 per participant Optional: Technology Integration Options Active Learning Tool 3.0.50 Optional: Depository Institution Advertisement Examples 2.2.1.E2 Let participants choose which option they would like to complete.

Page 15 2.2.1 1. Conduct the Depository Institution Advertisement 2.2.1.B1 activity. Two options are available for the advertisement: a radio spot and a billboard. 2. If completing the billboard option consider providing participants with one or all of the following options: a. Manually by using paper, crayons, colored pencils, markers, etc. b. Electronically by utilizing desktop publishing software or an online poster/collage maker. Refer to the Technology Integration Options Active Learning Tool 3.0.50 for online poster/collage maker websites and instructions. 3. An example is provided for both options on the Depository Institution Advertisement Examples 2.2.1.E2. ASSESSMENT OPTIONS There are two assessment options provided for this lesson: 1. Option one: Reinforcement Worksheet 2. Option Two: Depository Institution Research Option 1: Reinforcement Worksheet Approximate time: 20 minutes Materials to prepare: 1 What Do You Know About Depository Institutions 2.2.1.A5 per participant 1. Complete the What Do You Know About Depository Institutions 2.2.1.A5 worksheet as instructed. Option 2: Depository Institution Research Approximate time: 60 minutes possible time outside of class may be needed to conduct the research Materials to prepare: 1 Depository Institution Research 2.2.1.A6 per participant Optional: 1 Depository Institution Research Rubric 2.2.1.B2 per participant Optional: internet access 1. Individually or in small groups, complete the Depository Institution Research 2.2.1.A6. Participants conduct research on a depository institution and then write a short essay describing whether or not they would become a customer of that depository institution. Research may be conducted in a variety of ways depending upon what works in your classroom: a. Call the depository institution b. Visit the depository institution website c. Visit the depository institution d. Email the depository institution 2. The Depository Institution Research Rubric 2.2.1.B2 is available for grading if desired. After the radio spot is written, have participants translate it into a speaking avatar. Refer to the Technology Integration Options Active Learning Tool 3.0.50 for websites and instructions. Use the online resource Find A Better Bank to find depository institutions and conduct some or all of the research. Have participants create a presentation or some type of creation to share their research with the class. Then, have participants choose which depository institution they would choose out of those chosen. Require that the depository institution researched be one in your local community.

Page 16 2.2.1.E1 Introduction to Depository Institutions Vocabulary List TERM DEFINITION 1 Automated teller machine (ATM) A machine that allows individuals to complete certain transactions from the machine without human assistance 2 Checking account An account that allows quick access to funds for transactions 3 Commercial bank For profit depository businesses that offer financial services to both consumers and other businesses 4 Contactless payment Payment transactions that can be completed with no physical connection between the payment device and the physical point of sale (POS) terminal or store clerk 5 Credit Union Depository institutions that offer many banking services and are owned by their customers 6 Debit card A plastic card that is electronically connected to the cardholder s depository institution account 7 Depository institution Businesses that provide financial services 8 Interest The price paid for using someone else s money 9 Interest rate The percentage rate used to calculate interest 10 Mobile banking Apps that many depository institutions have developed that allow online banking access from devices such as smartphones, tablets and other mobile devices 11 Online banking Allows customers to complete certain transactions from a secured Internet site by using a username and password from any place in the world with Internet access 12 Savings account An account at a depository institution that is designed to hold money not spent on current consumption 13 Savings tool Accounts offered by depository institutions whose main purpose is to help people manage their money

Page 17 2.2.1.A1 Alike but Different 20 (1 point per box) Total Points Earned Total Points Possible Percentage Name Date Class Directions: Write the definition of each term in the space provided. When prompted by your instructor answer the remaining questions. Commercial Bank Definition: Credit Union Definition: Checking Account Definition: Savings Account Definition: How are these terms alike? How are these terms alike? How are these terms unique? How are these terms unique?

Page 18 2.2.1.A1 Online Banking Definition: Mobile Banking Definition: Definition: ATM Definition: Debit Card How are these terms alike? How are these terms alike? How are these terms unique? How are these terms unique?

Page 19 2.2.1.A2 Agree or Disagree? Total Points Earned Name 12 (4 points per Total Points Possible question) Date Percentage Class Directions: Complete the Before section by determining whether you agree or disagree with each statement and explaining your decision in the comment section. Complete the After section when prompted by your instructor. A bank can help me positively manage my money. Comment: Agree Before Disagree Comment: Agree After Disagree I trust that my money is safe if I store it in a bank. Comment: Agree Before Disagree Comment: Agree After Disagree My money has the possibility to increase in value if stored at a bank. Comment: Agree Before Disagree Comment: Agree After Disagree

Page 20 2.2.1.L1 Introduction to Depository Institutions Note Taking Guide Total Points Earned Total Points Possible Percentage Name Date Class Directions: Use the prompts provided to help you take notes during the lesson. What is a depository institution? Types of depository institutions What are two characteristics of a commercial bank? 1. 2. What are two characteristics of a credit union? 1. 2. Location How does location play a factor in choosing a depository institution? Insurance What does depository institution insurance cover? Services A person may earn or be charged interest from depository institution services. What is interest? What is an interest rate? Savings tools are accounts that help you manage your money. The two most common accounts are checking accounts and savings accounts: What is a checking account? What is a savings account?

Page 21 2.2.1.L1 What is credit? What other services do depository institutions offer? Features Online banking allows customers to complete certain transactions with their depository institution from a secured Internet site by using a username and password. What are two activities that may be completed with online banking? 1. 2. How is mobile banking different from online banking? What is a debit card? An ATM is a machine that allows depository institution customers to complete certain transactions from the machine without the need for human assistance. What are two activities that may be completed with ATMs? 1. 2. What is contactless payment? Fees Fees will vary between institutions and within different services at the same institution. Explain one type of fee that a depository institution may charge:

Page 22 2.2.1.A3 Josie s Depository Institution Comparison Chart Total Points Earned Name 10 points for Total Points Possible completion Date Percentage Class Directions: Josie has determined that she will use one of two depository institutions and has summarized the information regarding each depository institution below. Use the information provided by your instructor to determine which depository institution is the best choice for Josie. Features Depository Institution Option 1 Depository Institution Option 2 Minimum account balance $0 $100; a $10 fee is charged if the balance is below $100 Monthly Service Fee None None Debit Card Yes; free and unlimited usage Yes; free and unlimited usage ATM Fee Yes; $2 if another institution s No ATM locations ATM is used five within the college campus; three within the hometown area two within the college campus area; two within the hometown area Online banking Yes Yes Mobile banking/smartphone Yes No application Unlimited check writing Yes No; up to ten checks may be written each month Free checks Yes Yes Insufficient fund fees $24 per transaction $22 per transaction Account overdraft protection Yes Yes Linked Savings Account Option Yes; ability to transfer unlimited funds to a savings account Yes; ability to transfer unlimited funds to a savings account Interest earned on balance No.02% Branch locations within 5 Yes; three of them Yes; one of them miles of college Branch locations within 5 Yes; two of them Yes; two of them miles of hometown Branches in neighboring Yes No states Insurance provided on deposits $250,000 per depositor, per account; covered by FDIC $250,000 per depositor, per account; covered by NCUA Accountholder requirements None Must be an employee (or related to an employee) of the railroad system Josie s father is employed by

Page 23 2.2.1.H1 Help Josie Choose a Depository Institution Scavenger Hunt Cards Josie is super excited in today s mail she received a letter that she was selected to represent her new school on the university track team! She is not only excited because she will earn a scholarship and loves track, but she will also get to travel to neighboring states for track meets. Underline any information in Josie s Depository Institution Comparison Chart that might help Josie make a choice related to this new information. Since Josie is still learning about how to best manage her finances, she has been making some mistakes and not writing down every transaction. This resulted in four instances where Josie had insufficient funds to cover all the transactions she had authorized in the last six months. Place a checkmark beside any information in Josie s Depository Institution Comparison Chart that might help Josie make a choice related to this new information As an early graduation gift, Josie s grandmother purchased a smart phone for her. She immediately grows to enjoy the phone s efficiency and quickly learns that apps may be used in many different ways not only for fun and communications but also for managing her finances. Write an x next to any information in Josie s Depository Institution Comparison Chart that might help Josie make a choice related to this new information. Each month, Josie will need to pay her automobile insurance, cell phone bill, and tuition. She will also need to write some checks or use a debit card for purchases such as textbooks, food, and entertainment. Circle any information in Josie s Depository Institution Comparison Chart that might help Josie make a choice related to this new information.

Page 24 2.2.1.H1 Josie is still learning to be responsible with her finances, and sometimes forgets to write down every transaction. She will need an easy, quick way to check her recent transactions as well as her current checking account balance. Write a % next to any information in Josie s Depository Institution Comparison Chart that might help Josie make a choice related to this new information. Since she will be on a tight budget as a college student, she would prefer if she didn t have any minimum balance constraints on her checking account. Draw a star next to any information in Josie s Depository Institution Comparison Chart that might help Josie make a choice related to this new information. Josie s sister opened an account at a depository institution and later learned that the monthly fees made her responsible for nearly $50 a month in charges. Josie wants to avoid this costly mistake. Draw a box around any information in Josie s Depository Institution Comparison Chart that might help Josie make a choice related to this new information. In an effort to save extra money, Josie would like to find a depository institution that offers additional earnings for deposits. Draw a $ next to any information in Josie s Depository Institution Comparison Chart that might help Josie make a choice related to this new information.

Page 25 2.2.1.A4 Help Josie Choose a Depository Institution Total Points Earned 24 Total Points Possible Percentage Name Date Class Josie is a senior in high school who will be graduating in a few months. She has already been accepted to a university that is a three hour drive from her home. While she is excited about moving on to the next phase of her life, she s a little nervous about some of the important decisions she will be making moving out of her parents home and into the dorms at a college, choosing classes for her schedule, and finding a part time job. Josie is also going to need to make some decisions about her money. She knows it s not safe to carry all of her cash in her pocket, and while she won t have a lot of bills to pay, she needs to be able to write a few checks each month and utilize a debit card to have access to her funds. Josie has done a little research on depository institutions in her area that also have branches nearby the college she will be attending, and has narrowed her choices to the two options described in the Josie s Depository Institutions Comparison Chart. Follow the steps below to learn more about depository institutions in order to help Josie choose the depository institution that is best for her. Step One: 1. Examine Josie s Depository Institutions Comparison Chart 2.2.1.A3 and determine if Depository Institution Option 1 and Option 2 are a bank or a credit union. (4 points) Is this depository institution a bank or a credit union? Give one reason to support your answer. Depository Institution Option 1 Depository Institution Option 2 2. How did location influence Josie s selection of her top two depository institutions? (1 point)

Page 26 2.2.1.A4 Step Two: 3. While watching the news today, Josie saw that a local depository institution is closing. Now that she understands the importance of depository institution insurance, she wants to ensure her choices are insured. (4 points) Is Depository Institution Option 1 insured? Explain how you determined the answer. Is Depository Institution Option 2 insured? Explain how you determined the answer. Step Three: 4. Josie is looking for a checking account that is linked to a savings account. This will allow her to transfer money from her checking account to her savings account when needed. (2 points) Does Depository Institution Option 1 have a savings account linked to the checking account? Does Depository Institution Option 2 have a savings account linked to the checking account? Step Four: 5. Your instructor will provide you with more information about Josie to help make a decision regarding which depository institution is best for her. Record what you learned about Josie below: (8 points) 1. 2. 3. 4. 5. 6. 7. 8. 6. Using the information you know about Josie, which checking account would you recommend she choose option 1 or option 2? Explain your choice with at least three reasons. (5 points)

Page 27 2.2.1.B1 Depository Institution Advertisement Total Points Earned 21 Total Points Possible Percentage Name Date Class Directions: You work at a depository institution and have volunteered to create an advertisement for the depository institution. The advertisement should convince current and potential customers that your depository institution is the best to use. You have two options for the advertisement: a radio spot or a billboard. Radio Spot: A radio advertisement is often known as a radio spot. If you choose this option you will write a script for the radio advertisement that is approximately 30 seconds long. Billboard: A billboard is a large outdoor sign that is used to advertise businesses, goods, services, and ideas to consumers. If you choose this option, you will design a billboard using the materials provided by your instructor. Remember that billboards must be eye catching and appealing so that those passing by will take time to read the advertisement (the words must be large enough to read as well). Be creative! You will be graded on the following: Content: The advertisement convinces current and potential customers that the depository institution is the best to use Information is accurate Writing Skills: Sentences are fluent and effective Very few errors in mechanics, punctuation and word choice Effectiveness of Presentation: Clearly prepared Easily read and neatly assembled Eye catching and compelling Minimum of one page, doublespaced with 12 font and 1 inch margins. Exemplary Satisfactory Unsatisfactory No Performance 9 7 6 4 3 1 0 6 5 4 3 2 1 0 6 5 4 3 2 1 0 Score Total Points Earned Total Points Available 21 Percentage

Page 28 2.2.1.E2 Depository Institution Advertisement Examples Billboard example: Dislike paper cuts? Despise writer s cramp? Then, you will love our FREE electronic banking options! Online Banking Mobile Banking Debit Cards Considerate Credit Union We care about you! Radio Spot Example: Is your piggy bank overflowing. or maybe not flowing at all? In either case, Interest ed In You Bank can help you! We offer a wide variety of services to our customers along with knowledgeable employees and a convenient location to make your daily financial tasks as simple and quick as possible. Do you need to open a savings account to store the money in that overflowing piggy bank? With our high interest rates, there is no reason not to make a visit to Interest ed In You Bank, located at the intersection of Savings and Spending Streets in Depository Institution Square. No matter what your financial needs are we can help, because we are Interest ed In You!

Page 29 2.2.1.A5 What Do You Know About Depository Institutions? Total Points Earned 29 Total Points Possible Percentage Name Date Class Directions: Choose whether each statement describes a credit union, commercial bank, or both by placing the corresponding letter in the blank. (1 point each) 1. Anyone can open an account here 2. Offers financial services to the public 3. Owned by their customers 4. In business to make money 5. Membership requirements to open an account A. Credit Union B. Commercial Bank C. Both Directions: Answer the following questions with complete sentences. 6. What are two benefits depository institutions can provide? (2 points) 7. What would be the three most important factors that you would consider when deciding which depository institution fits your needs? Explain. (3 points) 8. What are two ways depository institutions keep your money safe? (2 points) 9. What is the difference between a checking account and a savings account? (2 points)

Page 30 2.2.1.A5 10. What is one example of a special needs payment instrument? (1 point) 11. Describe the difference between online banking and mobile banking. (2 points) 12. What are three activities that may be completed with online banking? (3 points) 13. What are two activities that may be completed with an ATM? (2 points) Directions: Circle whether each of the following statements are true or false. (1 point each) T F 14. A debit card can be described as an electronic check that requires a PIN. T F 15. All depository institutions offer ATM s in many different locations. T F 16. If a merchant accepts debit cards, that place of business will also offer contactless payment as an option. T F 17. An overdraft fee may be charged if you exceed your checking account balance when using your debit card. T F 18. All depository institutions are required by law to charge the same fees. T F 19. One person can open accounts at more than one depository institution. T F 20. A person can earn and be charged interest.

Page 31 2.2.1.A6 Depository Institution Research Total Points Earned Total Points Possible Percentage Name Date Class Directions: Complete each section below by following the directions provided. Before Research What would be the three most important things you would look for in a depository institution? (3 points) 1. 2. 3. Research Find a depository institution that offers at least one type of checking account and one type of savings account. Decide whether or not you should become a customer of this depository institution by conducting research and answering the questions in the table below. (15 points for completion) What is the name of the depository institution you are researching? What type of depository institution is it? Commercial Bank Credit Union Other. Please indicate the type: Location: Does this depository institution have a physical location or is it available only online? If there are physical locations, how many locations does the depository institution have? Online only Physical location(s) available Only one location available Multiple locations available locally Multiple locations are available across the state Multiple locations are available across the nation Other. Please explain:

Page 32 2.2.1.A6 Insurance: Is this depository institution insured? Yes No Checking account: Does the depository institution offer more than one type of checking account? If so, choose one checking account and answer the questions below. Only one type of checking account is available Multiple types of checking accounts are available. Which checking account did you choose? Are there any fees associated with this checking account? If so, can you avoid the fee(s) by managing your account responsibly or is there a non avoidable fee(s)? Explain. No fees Fees: Does the checking account offer unlimited check writing? If not, what is the limit? Unlimited check writing Limited check writing. What is the limit? What is one other thing you would like to know about checking accounts before making your decision? Savings account: Does the depository institution offer more than one type of savings account? If so, choose one savings account and answer the questions below. Only one type of savings account is available Multiple types of savings accounts are available. Which savings account did you choose? What is the current interest rate on the savings account? If the rate is not listed online, what email or phone number could you use to learn? Are there any fees associated with this savings account? If so, can you avoid the fee(s) by managing your account responsibly or is there a non avoidable fee(s)? Explain. No fees Fees: Is there any other information that is important to consider about this savings account?

Page 33 2.2.1.A6 Features Offered Does the depository institution offer debit cards as part of their accounts? Yes No How many (if any) ATMs does the depository institution have? ATMs are not available ATMs are available. Describe how you know ATM s are available in your desired location. Does the depository institution offer online and/or mobile banking? Other Services: Online banking is not available Online banking is available Online and mobile banking is available Describe one other service this depository institution offers. Other information: What is one other piece of information that is important to know if deciding whether or not to become a customer of this depository institution. Research Reflection After examining your research, is this a depository institution that you would become a customer of? Make sure to consider the three items you identified as important factors to consider when choosing a depository institution. Answer this question in a well written paragraph. Provide at least three reasons to support your decision. (21 points see rubric)

Page 34 2.2.1.B2 Depository Institution Research Rubric Total Points Earned Total Points Possible Percentage Name Date Class Directions: After examining your research, is this a depository institution that you would become a customer of? Make sure to consider the three items you identified as important factors to consider when choosing a depository institution. Answer this question in a well written paragraph. Provide at least three reasons to support your decision. Content: Identified the three most important factors to consider when choosing a depository institution Information is accurate Thorough research was conducted and all questions were answered More than 3 reasons were provide to support the decision Writing Skills: Sentences are fluent and effective Very few errors in mechanics, punctuation and word choice Effectiveness of Presentation: Easily read and neatly assembled Minimum of one page, doublespaced with 12 font and 1 inch margins. Exemplary Satisfactory Unsatisfactory No Performance 9 7 6 4 3 1 0 6 5 4 3 2 1 0 6 5 4 3 2 1 0 Score Total Points Earned Total Points Available 21 Percentage

2.2.1.F1 Introduc on to Depository Ins tu ons Advanced Level Millions of people use financial services offered by depository ins tu ons on a daily basis to help them manage their money. Commercial banks, credit unions, and savings banks are all examples of depository ins tu ons. Many types of companies offer financial services to consumers. But, depository ins tu ons are special in that they accept deposits from consumers and the safety of those deposits is o en guaranteed by the government. The range of valuable services ed to deposit accounts (online banking, checking accounts and debit cards, bill payment services, automa c savings transfers) makes depository ins tu ons an important component to a financial plan. Types of Depository Ins tu ons Commercial banks and credit unions are the most commonly used depository ins tu ons. Although both types of ins tu ons offer a range of banking services, they are actually quite different in terms of their ownership structure and the types of consumers they serve. Commercial banks are for profit depository businesses that offer financial services to both consumers and other businesses. Banks are usually the largest depository ins tu ons and offer the widest variety of services to customers. Credit unions are depository ins tu ons that offer many banking services. But, unlike banks, they are owned by their customers, who are usually called members. A credit union has membership qualifica ons that require its members share a common bond such as the same employer, the geographic area in which they live or membership in an organiza on. Credit unions are non profit organiza ons exempt from federal income tax. This feature o en allows them to pay higher interest rates on deposits, charge lower interest rates on loans and charge lower fees, compared to banks and other depository ins tu ons. Do you use a depository ins tu on? If so, what kind of depository ins tu on is it? If not, what features of a depository ins tu on do you think would work best for you? The physical loca on of a depository ins tu on may influence your choice. Here are some ques ons to consider when choosing a depository ins tu on that best fits your financial needs: Is the depository ins tu on accessible; does it have mul ple loca ons close to home, work and school? Does the depository ins tu on have loca ons (branches) throughout the United States (something to consider if you travel a lot or plan to move)? What type of transporta on is required to access a branch if it isn t within walking distance? If you are considering a depository ins tu on whose services are offered only online, will that type of access meet your financial needs? Take Charge Today August 2013 Introduc on to Depository Ins tu ons Page 1 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Ins tute at The University of Arizona

Deposit Insurance 2.2.1.F1 One of the most important services that a depository ins tu on offers is a safe and secure place to deposit your money for future use. Stashing your money away in what you might consider a safe loca on within your home or having large sums of cash in your wallet is financially risky. If lost or stolen your money is most likely gone for good. However, depository ins tu ons offer secure storage of both cash and transac on data. Most importantly, deposits in many banks and credit unions are protected by insurance provided by two federal government agencies know as the Federal Deposit Insurance Corpora on (FDIC) and the Na onal Credit Union Administra on (NCUA). Federal Deposit Insurance Corpora on (FDIC) The FDIC is a federal government agency that insures depository ins tu ons that have elected for FDIC coverage against loss. The standard insurance amount is $250,000 per depositor, per insured ins tu on, for each account ownership category. Na onal Credit Union Administra on (NCUA) The NCUA provides insurance protec on for credit unions. The coverage is the same as with the FDIC; each depositor is insured against loss up to a maximum of $250,000 against loss. As long as you stay within the coverage limits your money is safe from loss due to the or failure of the financial ins tu on. Not all depository ins tu ons are covered by the FDIC or NCUA, so you should check for coverage before deposi ng any money. Services Offered by Depository Ins tu ons Depository ins tu ons offer a wide variety of financial services to their customers. The services offered and the terms and condi ons (such as features and fees) will vary for every service at every depository ins tu on. Transac on and Savings Tools Think about how you make purchases at the point of sale. Managing a large amount of cash (and protec ng it from risks) can be overwhelming and me consuming. Depository ins tu ons offer services that allow you to use your money without having to handle cash. These services are known as transac on and savings tools. They are accounts offered by depository ins tu ons whose main purpose is to help people manage their money. Transac on and savings tools may or may not earn interest. Interest is the price paid for using someone else s money. If you deposit money in an interest earning savings tool account you will be paid interest during the me the ins tu on holds your funds and uses it for its own purposes. The depository ins tu on is essen ally borrowing your money. Eventually you ll see your ini al deposit grow over me as it accrues interest paid by that ins tu on. If you want to earn interest on your deposits look for high interest rates. When you borrow money and have to pay interest look for low interest rates. Are you currently earning any interest? If so, on what? Take Charge Today August 2013 Introduc on to Depository Ins tu ons Page 2 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Ins tute at The University of Arizona

2.2.1.F1 The two most common types of transac on and savings tools are checking and savings accounts: Checking Account A checking account allows you quick access to funds for transac ons. You re able to transfer money from one account to another or directly to another person through the use of paper checks, debit cards or withdrawing cash directly from your checking account. Checking accounts are very popular among consumers because they reduce the need to carry large amounts of cash and are easy to use and manage. Some checking accounts earn interest but most do not. Checking accounts at credit unions are known as share dra accounts. This type of account also provides an easy method for accessing your money. Savings Account A savings account is the most common type of bank account and may be the first type of account you open at your depository ins tu on. Savings accounts are generally for money that you don't intend to use for daily expenses. Your savings account will earn interest on its balance and be stored in a secure loca on. To open a savings account, simply go down to your local bank with proper iden fica on and ask to open an account. A savings account at a credit union is some mes referred to as a share account and is required for membership. Has opening a checking or savings account posi vely influenced the way you manage your money? If you haven t opened up one at this point in your financial life, can you iden fy ways a bank account might influence your money management habits in the future? Addi onal services offered by many depository ins tu ons include: Credit Credit products allow you to borrow money from the financial ins tu on in exchange for your promise to repay those funds in the future. Depository ins tu ons may provide a variety of credit products such as loans for the purchase of a house, auto or educa on. Many depository ins tu ons also offer credit cards to their customers. When you apply for credit, the financial ins tu on will determine whether you qualify for the loan based on their assessment of the likelihood that you will repay as agreed. The ins tu on will also determine the amount of me you have to repay, and the price of the loan, in the form of the interest rate to be charged on the amount of money you owe. By agreeing to these loan terms you will agree to pay the depository ins tu on back the money borrowed plus interest. Financial Advice Depository ins tu ons may also offer informa on, advice and assistance regarding a wide range of financialrelated topics including investments and estate planning. Safe Deposit Box A safe deposit box is a secured box at a depository ins tu on that you can use to store valuable personal items. Many people use safe deposit boxes to store important paperwork such as birth cer ficates, Social Security cards and wills. Special Needs Payment Instruments Traveler s checks, cer fied checks, cashier s checks and money orders are all special payment instruments that have a specific func on and are available at most depository ins tu ons. To use any of the services offered by depository ins tu ons, call, visit, email or search the depository ins tu on s website to determine what steps are needed to use the service you desire. You may be required to have an account to use their services. If you are under the age of 18, in most cases, you will need a parent/guardian signature to open an account. Which depository ins tu on services would be the most important to you? Take Charge Today August 2013 Introduc on to Depository Ins tu ons Page 3 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Ins tute at The University of Arizona

Addi onal Features of Depository Ins tu on Services 2.2.1.F1 The services offered by depository ins tu ons may offer certain features such as online banking, mobile banking, debit cards, ATMs and contactless payment. Online banking A depository ins tu on may offer online banking, also known as Internet banking, as a feature of their services. Online banking allows customers to complete certain transac ons from a secured Internet site by using a username and password from any place in the world with Internet access. Online banking ac vi es include accessing account informa on and statements, transferring money between accounts, paying bills and applying for credit. In addi on to paying bills online, consumers may also be able to set up a recurring bill payment. The payment will occur automa cally on a specific date each month without the customer having to write a check or ini ate the payment. However, if you use recurring payment it is your responsibility to make sure that your account has sufficient funds in it to cover the amount of the automa c payment. What is one advantage to online and/or mobile banking? Many depository ins tu ons have developed apps that allow online banking access from devices such as smartphones, tablets and other mobile devices. This is a form of online banking known as mobile banking. Debit cards A debit card is electronically connected to the cardholder s depository ins tu on account. Debit cards allow customers easy access to money in their savings and checking accounts either at the point of sale or through an automated teller machine (ATM). As a payment tool, debit cards func on in the same manner as a check, but debit transac ons are faster and more portable because they are electronic. Debit cards also allow customers to withdraw cash or electronically access their accounts to transfer funds between accounts or view balances. In most cases, debit cards require using a personal iden fica on number (PIN) or signature to perform transac ons. The PIN or signature authorizes the user of the debit card to access the money in the corresponding account. Automated teller machines (ATMs) Contactless payment An ATM is a machine that allows individuals to complete certain transac ons from the machine without human assistance. ATMs are accessed via an ATM card (which is usually also the customers debit card) plus the PIN that accompanies that card. ATMs allow customers to withdraw and deposit money into their account(s), as well as make account transfers and view account balances. The number and loca on of ATM s varies by depository ins tu on. Contactless payment transac ons can be completed with no physical connec on between the payment device and the physical point of sale (POS) terminal or store clerk. If a depository ins tu on offers contactless payment op ons then you will receive a debit card, credit card, or some other type of electronic card that allows you to simply wave the card in front of a sensor to make a purchase (some mes you may have to also enter a PIN for the payment to authorize). This allows for fast payment transac ons, but not all merchants have the technology to support contactless payment. What features of depository ins tu on services would ma er to you? Take Charge Today August 2013 Introduc on to Depository Ins tu ons Page 4 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences Take Charge America Ins tute at The University of Arizona