Financial Services & Institutions Review

Flashcards for reviewing financial services and banking terms.

Time Deposit

Money left in a financial institution for months or years to earn interest.

CD (Certificate of Deposit)

A savings option where money is left for a fixed period to earn a specific return.

Demand Deposit

Money in a checking account that can be withdrawn at any time.

Direct Deposit

An automatic deposit of net pay to an employee’s designated bank account.

Automatic Payment

Payments where money is automatically withdrawn from your account to pay bills.

ATM (Automated Teller Machine)

A terminal used to withdraw cash, make deposits, or perform other banking tasks.

Debit Card

A card that allows withdrawals or payments directly from a checking/savings account.

PIN (Personal Identification Number)

A number used to verify identity with a debit card; should be memorized.

Point-of-Sale Transaction

A purchase made by debit card at a store or service location.

Store Value Card

A prepaid card used for specific purposes like transportation or school lunches.

FDIC (Federal Deposit Insurance Corporation)

Insures bank deposits up to $250,000.

Commercial Bank

A for-profit institution offering full financial services.

Savings and Loan Association

Offers savings accounts and mortgage loans.

Mutual Savings Bank

Specializes in savings accounts and mortgage/auto loans, usually offers higher savings interest.

Credit Union

A non-profit financial institution owned by members sharing a common bond.

Non-Deposit Institutions

Includes life insurance, investment, finance, and mortgage companies.

Regular Savings Account

Offers low interest; allows frequent deposits and withdrawals.

Certificate of Deposit (CD)

Money left for a set time earning a fixed interest rate.

Maturity Date

The date when money in a CD becomes available to you.

Money Market Account

A savings account with a minimum balance that earns interest that can vary.

U.S. Savings Bonds

Government-backed bonds that earn compound interest and double in value over time.

Rate of Return

The percent increase in savings value due to interest.

Principal

The original amount of money deposited.

Compounding

Earning interest on both the principal and accumulated interest.

Annual Percentage Yield (APY)

The total interest earned in one year on $100, including compounding.

Truth in Savings Law

Requires disclosure of fees, APY, and terms by financial institutions.

Liquidity

How easily you can access your money without penalty.

Regular Checking Account

May not require a minimum balance, but often has monthly service fees.

Activity Account

No balance requirement, but charges per check/deposit.

Interest-Earning Checking Account

Combines checking and savings features.

Overdraft Protection

A loan made to cover checks when the balance is insufficient—may charge interest.

Signature Card

A card with your signature used to verify checks you write.

Stop-Payment Order

A request to prevent a check from being cashed.

Endorsement

The payee’s signature on the back of a check.

Blank Endorsement

Just your signature.

Restrictive Endorsement

“For Deposit Only” + signature.

Special Endorsement

“Pay to the Order of” + signature.

Check Clearing

The process of ensuring your deposit is valid and funds are available.

Bank Reconciliation

Matching your checkbook with your bank statement to ensure accuracy.

Certified Check

A personal check guaranteed by the bank.

Cashier’s Check

A bank-issued check paid for in advance plus a fee.

Traveler’s Check

Used to obtain local currency while traveling.