To Do List Take out notebook Date page

To Do List… Take out notebook Date page Write heading: Understanding Checking Accounts Take notes when you see

Banking Unit Understanding Checking Accounts

Objectives for the Day… Understand what a checking account is and what it is used for. Identify how money is spent/removed from a checking account. Recognize the basic components of a check.

Essential Question: Why are checking accounts important to our daily lives?

Checking Accounts An account opened at a financial institution that allows for withdrawals and deposits. • The account is initially opened by putting money into the account. • Designed to hold funds for a short period of time (immediate uses). • Used to pay bills and make purchases.

Methods for spending/removing money Account owner spends from the account: • Uses debit card • Writes checks

Debit Card A card that is issued from the bank that connects to your account: • Can pay for goods and services. • Money is deducted from account when used. • Able to withdraw cash from an ATM. *Related Question: How is a debit card different from a credit card? • A debit card takes it from you banking account and a credit card charges it to your line of credit.

Advantages and Disadvantages Advantage: • No need to carry cash • More convenient • Give an example! Disadvantage: • Must be diligent at tracking your spending • Could overdraw your account (when a withdraw or check written exceeds the funds in the account)

Checks A written document that authorizes the transfer of money from a bank account to a person or business. • The money is drawn from your checking account.

Basic components of a check Use the worksheet. Fill out each section as we go.

Name of account owner.

Person/company the check is to be paid to.

The amount of the check written out in words. Example: One hundred and 00/100

Date the check was written.

The amount of the check in numeric form. Example: $100. 00

Check number – used for tracking the checks.

Used to list the purpose of the check.

The financial institution where the account is held.

Routing number – connects the check to the financial institution.

Account number – connects the check to your account.

Check number, allows financial institution to track checks.

Signature line – needed from the account owner to authorize the check.

Today is December 12 and the electric bill has come in. You have decided to write out the check immediately so you don’t forget later in the month. The electric bill from National Grid is $47. 82. Let’s write out a check. December 12 11 National Grid ----47 82 Forty Seven and 82/100 -----------------------Electric bill John A. Doe

“We Do” Know we are going to practice filling out a check together. We are going to be working on the front board. Look on the Power Point to see our tasks.

Task #1 Today is December 13, 2011. Your heat bill is due from National Fuel. Your bill is $150. 75. Here is the information you will need for the check. • National Fuel • Amount: $150. 75

12 December 13 NNational Fuel One hundred fifty and HHeat Bill 1111 1150 75 ------------- m. Miss Heider

Task #2 Your holiday shopping has come to an end! Your bill from Macy’s Department Store has just arrived. The amount on the credit card bill is $220. 45. Macy’s Department Store $220. 45 Today’s date Write out your check!

DDecember 12 Macy’s Department Store Two hundred twenty and Credit card payment 11 220220 ---------------- m. Miss Heider 245

Task #3 Your friend Todd loaned you money to fix a flat tire. Now you have to pay him back. The amount you owe Todd is $30. 15. • Todd Carr • Amount: $30. 15 • Today’s date • Write out your check!

DDecember 12 Todd Carr Thirty and Tire Money ----------------------------- m. Miss Heider 11 220_ 30 1818

“You Do” Now its your turn to try writing out a check on your own. Take out the blank check template. Look to the next slide to see your task.

Task #1 You just realized your phone bill is due this week. You owe $75. 83 to Verizon Wireless Phone Company. • Verizon Wireless Phone Company • $75. 83 • Use today’s date • Write out your check!