The List: Download Vocabulary

Flash Cards: Check comprehension

The Vocabulary:

APY – Annual Percentage Yield — The true or effective rate of interest when compounding is taken into effect
ATM – Electronic terminals located on bank premises or elsewhere, through which customers of financial institutions may make deposits, withdrawals, or complete other transactions as they would through a bank teller
Canceled check – Checks the bank has processed
Cash machine – See ATM
Cashier’s check – A check written by a bank on its own funds in exchange for payment by an individual
CD – A time certificate representing a sum of money deposited for a set length of time, such as six months
Checking account – A banking service wherein money is deposited into an account and checks are written to withdraw money as needed
Commercial bank – An institution which accepts deposits, makes business loans, and offers related services
Compound interest – Interest earned on both principal and interest
Credit union – A member-owned and controlled not-for-profit financial cooperative that offers a variety of savings and lending services to members
Debit card – A plastic card that consumers may use to make purchases, withdrawals, or other types of electronic fund transfers; use of a debit card generally results in an immediate transfer of funds
Direct deposit – The deposit of funds directly into a bank account as a form of payment
EFT – Electronic Funds Transfer – transferring funds electronically rather than by check
FDIC – Federal Deposit Insurance Corporation – Provides deposit insurance which guarantees checking and savings deposits in member banks up to $250,000 per depositor
Fees – Charges for services rendered
Finance company – A company that makes loans to businesses and/or individuals
Money market account – A bank deposit that pays interest and that allows a saver to withdraw money at will, often by writing checks
NSF – Not sufficient funds – a check written without sufficient money in an account to cover it
Overdraft – A check written without sufficient money in an account to cover it
POS Terminal – A point-of-sale terminal serves as a computerized cash register; it can track orders, accept credit cards and debit cards, and keep inventory, among other things
Reconcile – Adjusting one’s checkbook balance to match one’s bank statement
Savings – The process of setting aside money until a future date instead of spending it today. The goal of saving is to provide funds for emergencies, short-term goals, and investments
Savings & Loan – Financial institutions that provide loans and interest-bearing accounts. Accounts in federally chartered S&Ls are federally insured
20/10 Rule – One should never borrow more than 20 percent of one’s yearly net income, and payments should not exceed 10 percent of monthly net income
3 C’s – Used by creditors to measure the credit-worthiness of potential customers, the three C’s are: capacity, character, and capital