$$ Finance Unit $$
There are many places to put the money you don't need to spend right away. They are usually safer than keeping it laying around the house, where it could be lost, stolen, or spent on a whim.
CHECKING ACCOUNTS - For money you want to be able to spend easily. Some banks offer free accounts, some cost a little each month, and a few actually pay you a tiny bit of interest.
QUESTIONS TO CONSIDER:
1. Does your bank charge you a fee to use its checking account?
2. If you keep a certain amount in the account, do they pay any interest?
3. Do they limit how many checks you can write each month?
SAVINGS ACCOUNTS - For money you want to set aside for awhile. These are usually free, but some banks require you to maintain a minimum balance to earn interest.
QUESTIONS TO CONSIDER:
1. How much interest does your bank pay you to keep your money in their savings account?
2. Do you earn more interest if you maintain a higher balance?
MONEY MARKET ACCOUNTS - For larger amounts of money you don't want to spend right away. Minimum balances are higher, but they pay better interest. Some banks limit how often you can take money out.
QUESTIONS TO CONSIDER:
1. How much interest does your bank pay you to keep your money in their Money Market account?
2. Do you earn more interest if you maintain a higher balance?
3. Do they limit how many times you can take out money each month?
CERTIFICATES OF DEPOSIT - Also known as CDs; this is for a bigger chunk of money you won't need to spend for awhile. These usually pay the best interest, but you must promise to leave the money alone for 6 months or more. Then, at the end of the term, you get your money back, plus the interest it earned.
QUESTIONS TO CONSIDER:
1. How much does the bank pay in interest?
2. How long do you have to leave your money alone?
3. What is the minimum amount you are required to spend on the certificate?
1. How much does the bank pay in interest?
2. How long do you have to leave your money alone?
3. What is the minimum amount you are required to spend on the certificate?