Banking Vocabulary

50-30-20

A popular savings rule of thumb in which 50% of your income goes towards necessities, 20% goes towards saving and debt repayment, and 30% goes towards flexible spending

balance

The amount of money you have in your bank account

bank statement

a monthly document prepared by your financial institution which shows all of the transactions related to your account

cancelled check vs voided check

a check that has been paid or cleared by the bank. It will appear on your bank statement

a check with "VOID" written across it so that it can no longer be used

certificate of deposit

a bank product that earns interest on a lump-sum deposit that's untouched for a predetermined period of time

checks and check register

a written, dated, and signed order to the bank that tells it to pay a definite sum of money to a payee

a record that allows you to keep track of checks you have written, ATM/debit card transactions, and deposits and withdrawals

credit vs debit

a sum of money deposited INTO an account

A sum of money deducted FROM your account

debit card vs credit card

A card that is directly connected to your checkign account. It enables you to conduct ATM transactions and to make purchases instead of using cash or writing a check

A card that allows the holder to make purchases without cash by borrowing money

digital wallet

an application that runs on mobile devices. It securely stores your payment information and passwords and allows you to pay for items without needing your physical cards.

direct deposit vs mobile deposit

an automatic electronic deposit of net pay to an employee's designated bank account

A mobile banking tool that allows you to deposit checks to your bank account using your mobile device

endorse

to sign the back of a check made out to you so it can be cashed or deposited

FDIC

The government agency that insures customer deposits if a bank fails up to $250,000 per individual depositor

maintenance fee

a monthly fee that some banks charge to provide access to chcecking or savings accounts

minimum balance

a certain amount of money that must be kept in an account as required by that particular financial institution

money market account

a type of savings account that may allow debit card and check writing privileges

money order vs cashiers check

a certificate that allows the stated payee to receive cash-on-demand, usually issued by governments and banking institutions

payment issued by a bank, drawn against the bank instead of a personal account

overdraft fee and overdraft coverage

a fee charged to your account when it lacks the funds to cover a withdrawal, but the bank allows the transaction to go through anyway

A loan banks offer to their customers when they try to withdraw more funds than they have in their account, usually for a fee and with interest

unusual activity alert

a notification that lets you know when there is suspicious activity with your account