Banking

Front

Overdraft protection...

Back

Allows you to withdraw more money than you have in your account

Answer explanation

Overdraft protection allows you to withdraw more money than you have in your account, preventing declined transactions and potential fees when your balance is insufficient.

Front

Which of the following is TRUE about banks and credit unions?
Options:
Banks are for-profit institutions, while credit unions are non-profit
Banks offer higher interest rates on savings accounts than credit unions
Credit unions are insured by the FDIC, while banks are not
Banks are owned by their customers, while credit unions are owned by shareholders

Back

Banks are for-profit institutions, while credit unions are non-profit

Answer explanation

The correct statement is that banks are for-profit institutions, while credit unions operate as non-profit entities, focusing on serving their members rather than generating profit.

Front

Which of the following is NOT required to open a checking account? Proof of identity, Proof of address, Social security number, Minimum age requirement

Back

Minimum age requirement

Answer explanation

To open a checking account, proof of identity, proof of address, and a social security number are typically required. However, a minimum age requirement can vary by bank and is not universally mandated.

Front

Which of the following is NOT a common way most people are using P2P, such as Venmo?
Splitting bills with friends,
Paying rent or utilities,
Sending money to family members,
Investing in stocks

Back

Investing in stocks

Answer explanation

Investing in stocks is not a common use of P2P payment apps like Venmo, which are primarily used for splitting bills, paying rent, or sending money to family, rather than for investment purposes.

Front

What feature is the LEAST important for a college student to look for in a checking account? Low or no monthly fees, Convenient ATM access, High interest rates, Online and mobile banking

Back

High interest rates

Answer explanation

High interest rates are generally less important for college students, who prioritize low fees, convenient ATM access, and online banking for managing their finances rather than earning interest.

Front

Which of the following is FALSE about check registers?
They help you keep track of your account balance,
They are used to record deposits and withdrawals,
They are no longer necessary with online banking,
They can help you detect errors or fraud

Back

They are no longer necessary with online banking

Answer explanation

The statement 'They are no longer necessary with online banking' is false. Check registers are still useful for tracking balances, recording transactions, and detecting errors or fraud, even with online banking.

Front

What is a typical overdraft fee?

Back

$25

Answer explanation

A typical overdraft fee is commonly around $25. This amount is standard among many banks, making it the most likely choice compared to the other options provided.

Front

How can you protect your checking account when using online and mobile banking? Options: Use strong and unique passwords, Avoid using public Wi-Fi networks, Regularly monitor your account activity, All of the above

Back

All of the above

Answer explanation

To protect your checking account while using online and mobile banking, it's essential to use strong and unique passwords, avoid public Wi-Fi networks, and regularly monitor your account activity. Therefore, the correct answer is 'All of the above'.

Front

You have $30 in your acct. How can a bank reorder 4 checks written today to MAXIMIZE your fees?

Back

Process the largest check first

Answer explanation

Processing the largest check first maximizes fees because it will cause the account to go negative sooner, leading to overdraft fees on subsequent smaller checks. This strategy increases the total fees incurred.

Front

Why is understanding a bank's fees particularly important for students or young adults?

Back

They are more likely to have a low income

Answer explanation

Understanding a bank's fees is crucial for students or young adults because they are more likely to have a low income. High fees can significantly impact their limited budgets, making financial literacy essential.