Banking 101

"I left my money in a savings account to accrue interest." What does the expression "accrue interest" mean?

• deduct money

• pay off bills

• build up money

• invest money in stocks

People who hide their money in a safe inside their house will not be able to . . . .

• a. buy anything at the store.

• b. pay for college.

• c. earn interest on their money.

• d. give their kids an allowance.

• e. both b and c

True or false:

When you deposit money in a bank, the bank pays you interest on it because they are seriously the sweetest people in the world and they just want what's best for you.

• TRUE

• FALSE

When you first deposit money into the bank, that amount of money is called the ____________________ .

• principal

• checking

• banknote

• interest

True or False:

When you deposit money in a bank, they keep it safe by locking it up in a secure vault within the bank itself.

• TRUE

• FALSE

Why does the bank pay you interest when you deposit money?

• Banks have a surplus of money and they can't keep it all in their vault.

• Banks need people to make money so they can buy products and support the economy.

• Banks are paying interest because they are paying you to use your money.

• Banks pay interest because they are looking out for your best interest.

When you write a check or withdraw money from your account, that money is _____________________ your balance.

• deducted from

• added to

When you deposit money, you are _______________________________.

• a. taking money out of your savings or checking account.

• b. accruing interest on your savings or checking account.

• c. putting money into your savings or checking account.

• d. losing money from your savings or checking account.

• e. A or D

Another word for "yearly" is ___________.

(For example, a bank gives you a yearly interest rate, also called an _ _ _ _ _ _ interest rate.)

In the banking world, what is interest? (check all that apply)

• a percentage of money that the bank pays you for use of your money.

• how much a person truly wants to know about investing money

• a percentage of money that someone pays the bank when they borrow money

• the payment for use of money

• depositing money into a bank