Select your own financial service provider 1 2014 National Endowment for Financial Education Lesson 54 Financial Service Providers Preview Today we will answer these questions Where can I cash my paycheck ID: 651576
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Financial Service Providers
Select your ownfinancial service provider
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Preview
Today we will answer these questions:
Where can I cash my paycheck? What is the difference between a bank, credit union, and check cashing business?What do I need to know about using banking services?How do I decide where to do my banking?Use what you learn todayto select a financial service provider.
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What’s the Difference?
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Teach Your Peers
Describe the financial service business
Share description in one or two sentencesReference at least one local exampleList typical consumer finance servicesExplain how consumers use the servicesExplain in 30-60 secondsGive examples of how teens use services
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Read the Fine Print
Do you think the fees and fee conditions are reasonable?Be prepared to share your findings with the class.
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Payday Loan
Customer leaves post-dated check with lender
Fill out applicationLeave a check to cover principal (amount borrowed) and feeMust be employed and must have bank accountMust be at least 18 years oldCustomer receives borrowed amountCustomer decides options by due date:Instruct lender to deposit post-dated checkPay cash and reclaim post-dated checkRenew loanCustomer pays feesHigh interestAdditional fees for “bounced” check
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Payday Loan … Good Choice?
What are other options rather than using payday loans?
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Principal
Time
Interest
APRTotal Owed
$500 (rent)
2 weeks
15%
$300
(car loan)
4
weeks
12%
$1,000
(household
and credit card bills
)
2
weeks
10%
Principal
Time
Interest
APR
Total Owed
$500
(rent)
2 weeks15%390%$575$300 (car loan)4 weeks12%156%$336$1,000 (household and credit card bills)2 weeks10%260%$1,100
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Services That Matter
Life Style
In-person or ATM deposits and withdrawalsOnline or mobile bankingConvenient hoursConvenient locationNumber of branch locationsOther services (overdraft, automatic savings programs, alerts/reminders, etc.)Fees and User RequirementsMinimum opening depositRequired monthly balanceOverdraft feesATM feesPenalties and withdrawal limitationsMonthly maintenance feeInterest rates
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Challenge
5-B: Which is Best for Me?
Use the DECIDE steps to select a financial institution with servicesthat are right for you.
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Reflection
Where do you keep your money now and why?
Is it safe?Is it growing?Can you track it?
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