Personal Finance Study Guide

When using a debit card at a supermarket checkout, where does the money for the purchase come from?

• Your credit card company covers the cost

• It is deducted directly from your checking account

• Your credit card company provides you with a cash advance to cover the cost

• The store provides a discount equivalent to the purchase amount

Which of the following is the best use of a person-to-person payment?

• To give a donation to someone soliciting contributions outside the grocery store

• To repay your uncle who covered the cost of your first semester textbooks

• To buy some school supplies and baseball equipment while shopping online

• To pay for a meal at a restaurant

What is the best recommendation for Tammy to ensure her payment is on time for the school trip?

• Sign up for direct deposit with her employer so that the money is already in her account the morning of the 1st

• Use her 15-minute break during work on the 1st of each month to run to the check cashing business

• Deposit the check through her mobile app on the 1st of the month and do a cash withdrawal from the ATM each month on the 2nd

• Request an extension for payment deadlines from the trip organizers

What should Jocelyn do if she notices her bank account balance is unexpectedly low?

• Ignore the situation as it might be a temporary error

• Check her recent account statements and transactions for any discrepancies

• Wait for the bank to contact her regarding the low balance

• Immediately deposit more money without checking the transaction history

What should you do if you notice unauthorized withdrawals from your bank account?

• Wait until her monthly statement arrives so she can check to see if those withdrawals are still there

• Wait a week, as it is fairly common for the bank to catch mistakes like this

• Check her wallet to be sure her debit card has not been stolen. If she still has it, then she should not worry

• Contact the bank immediately to report the unauthorized transactions

Which of the following is NOT a way to access money in your checking account?

• Take out cash using your debit card at an ATM machine

• Write a check to pay the rent on your apartment

• Swipe a prepaid card to pay for your fast food purchase

• Transfer money via an online banking app

Which transaction will immediately REDUCE your checking account balance?

• Writing your monthly rent check which you will mail tomorrow

• Using your debit card to pay for groceries at the supermarket

• Depositing a check at a local bank branch

• Receiving a wire transfer

What is likely to happen if you overdraft your account but have overdraft protection?

• Your account would be closed

• You will likely be charged an overdraft fee for EACH transaction and also will need to repay the bank for the amount overdrawn ($29)

• Because you requested overdraft protection, the bank will not allow you to overdraw your account, so your debit card will be denied in these 3 instances

• The bank will cover the overdraft without any additional fees

How do credit unions differ from banks?

• Banks charge overdraft fees, but credit unions do not

• Banks are owned by shareholders, while credit unions are owned by members

• Banks allow customers to do online banking, while credit unions are too small to provide that service

• Credit unions offer higher interest rates on savings accounts than banks

What is an important question to ask before opening a checking account at a FDIC-insured bank?

• What is your schedule of fees for this account?

• How many branches do you have?

• Can I access my account online?

• What types of loans do you offer?