3.3 Fa HW Checking Accounts

What is a checking account?

• A type of bank account that offers easy access to deposited funds

• A type of bank account that pays high interest rates

• A type of bank account that restricts withdrawals and deposits

• A type of bank account that is only used for monthly bills

Why do checking accounts typically pay low interest rates?

• Because they allow unlimited withdrawals and deposits

• Because they have high minimum balance requirements

• Because they are only used for ordinary purchases

• Because they are not insured by the FDIC

What are the convenient ways to access the money in a checking account?

• Write checks, make purchases with a debit card, make withdrawals and deposits with an ATM card

• Visit your local branch, use online bill pay service, set up automatic payments

• Transfer funds to and from other bank accounts

• All of the above

Where can you find free checking accounts?

• Large brick-and-mortar banks

• Community banks and credit unions

• Online banks

• All of the above

What does free checking mean?

• No monthly maintenance fee and/or minimum balance requirements

• No overdraft charges and other fees

• No direct deposit requirement

• No interest earned on the account

What is an interest-bearing checking account?

• An account that allows unlimited withdrawals and deposits

• An account that pays interest rates

• An account that requires a minimum balance

• An account that restricts debit card transactions

What is a joint checking account?

• A bank account shared by two or more people

• A bank account that requires a minimum balance

• A bank account that pays high interest rates

• A bank account that restricts withdrawals

What is the function of a debit card?

• To easily access the money in a checking account

• To earn interest on the money in a checking account

• To make ATM withdrawals only

• To make credit card purchases

What is overdraft protection?

• A fee charged by the bank for using a debit card

• A fee charged by the bank for overdrawing a checking account

• A service that allows you to continue using your debit card for purchases

• A service that allows you to withdraw cash from an ATM

What happens if you opt out of overdraft protection?

• All transactions that would put you in the red will be declined

• You will be charged an overdraft fee for each transaction

• You will not be able to use your debit card for purchases

• You will not be able to withdraw cash from an ATM