FINANCIAL SERVICES GETTING TO KNOW YOUR FINANCIAL INSTITUTION

FINANCIAL SERVICES GETTING TO KNOW YOUR FINANCIAL INSTITUTION

History of financial institutions Federal Reserve Act 12 Federal Reserve Districts Non-Banking Financial Institutions -Credit Unions -Savings and Loans Institutions 2

History of credit unions Cooperatives Meet the needs of a specific group of people 1909 - First Credit Union in the United States 1934 - Federal Credit Union Act 1970 - National Credit Union Share Insurance Fund (NCUSIF) NCUA 3

International efforts Financial access in developing countries Barriers Unbankable Cash-only users Cultural and religious factors Women and poverty groups Lack of competition Regulatory conflicts Rural areas Financial education World Council of Credit Unions 4

Why use a financial institution? Safety Convenience Security Planning 5

Types of financial institutions Banks Credit Unions Insurance Companies Check Cashing / Payday loans / Auto Title Loans Pawn Shops 6

Banks vs. credit unions Credit Union Not-for-profit cooperatives Owned by members Operated by mostly volunteer boards Charge lower and fewer service fees Pay higher saving rates Charge lower loan rates Local branches and decisions Banks For-profit corporations Owned by outside stockholders Controlled by paid boards Charge higher and more service fees Pay lower saving rates Charge higher loan rates 7

Deposit accounts Checking Accounts Savings Accounts Money Market Accounts Certificates of Deposit 8

Non-deposit accounts Stocks Bonds Mutual Funds 9

Loans Auto Home (Mortgage) Business 10

Additional services Direct Deposit Online and Mobile Banking Money Transfers Money Orders / Cashier Checks Safety Deposit Boxes 11

Opening and maintaining an account Open an account that best meets your needs Make deposits and withdrawals Record interest and fees Keep track of your balance 12

Checking account Convenience Cost Money Management Safety 13

Checking account An ATM or debit card A checkbook A check register 14

Checking account CHECK REGISTER Check Number Date Transaction Description Payment/ Debit (-) Deposit/ Credit (+) Balance 1025 Monthly Rent 475.00 1,200.00 725.00 15

Checking account 16

Checking account 17

Checking account 18

Deposits Cash or check Direct deposit ATM deposit Phone 19

Deposits 20

Deposits 21

Checks List singly 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 TOTAL Dollars Cents Deposits 22

Deposits 23

Direct deposit Funds are deposited directly into your account electronically. You do not receive a paper check Direct deposit is often used for your paycheck, income tax return, and student loan disbursement. Make deposits 24 hours a day using the ATM machine 24

ATM and debit cards ATM cards can be used at ATMs and Point of Sale terminals participating in the same network as your card Debit cards can be used anywhere the payment system (Visa or MasterCard) are accepted If your ATM or Debit card are lost of stolen, notify your bank within 2 days or you could be responsible for unauthorized purchases Temporary holds may be placed on your account 25

ATM and debit cards PIN-Based Debit Card Transaction Facts: Select Debit when processing transaction A PIN (Personal Identification Number) is used to complete transaction (no signature required) Money comes out of your checking account immediately Transaction is just like using cash Some merchants offer the option to get cash back with your purchase Signature-Based Debit Card Transaction Facts: Select "CREDIT" when processing transaction Sign for your purchases May take several days for money to come out of your account Cash back option not available 26

ATM and debit cards ATM Fees Overdraft Fees Annual Fees Minimum Balance fees 27

More ways to pay bills Electronic Bill pay -Pays your bills directly from your account -No postage or late fees Mobile Banking -Pay bills from your cell phone -Obtain account information Online Bill Pay -Set up automatic payments through your financial institution 28

Your account 29

Your account Record all transactions in our check register including fees, interest, and other charges Keep your checkbook register up to date and maintain totals Reconcile your account by finding and correcting any differences between your check book register and your bank statement 30

Reconciling your account Outstanding checks Deposits in transit Service fees/charges NSF (Not Sufficient Funds) EFT (Electronic Fee Transfer) Overdraft fees Bank Reconciliation Formula Check Register Balance Bank Statement Balance Ending Balance Ending Balance - NSF +Deposits in Transit -Overdrafts - Outstanding Checks -Service charges = New Balance ±EFT = New Balance 31