Financial services intr

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Financial services intr

  1. 1. • Activity 1…….Where Do I Keep My Money?• Activity 2…….Evaluating Financial Services• Activity 3…….Banks, Yesterday and Today
  2. 2. ACTIVITY 1Where Do I Keep My Money?Overview• The functions of banks• The cost of alternative financial services• The stability of banks Introduction to Financial Services - Activity 1
  3. 3. PLACES TO SAVE MONEYWould you save your money in any of theseplaces? Why? Why not? Can you think ofother places to save money? • Bed & Mattress • Cookie Jar • Pillow • Wallet • Money Belt • Small House Safe Slide 1 - Places to Save Money Lesson Reference: Introduction to Financial Services, Activity 2 – Overhead 1
  4. 4. ALTERNATIVE FINANCIAL SERVICES• Check-Cashing Services• Check-Deferrals, Cash Advances, Payday Loans• Pawn Shops• Rapid Tax Refunds• Rent-to-Own• Other Financial Services Slide 2 - Alternative Financial Services Lesson Reference: Introduction to Financial Services, Activity 1 – Handout 1
  5. 5. FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC)• Established in 1933.• Insures most Savings, Checking, and other Deposit Accounts, up to $100,000 per depositor, per institution.• Applies to most Commercial Banks, Savings Banks, and Savings Associations. Slide 3 – FDIC Lesson Reference: Introduction to Financial Services, Activity 1 – Overhead 2
  6. 6. ACTIVITY 2Evaluating Financial Services Overview • Formal and informal financial services • Costs of alternative financial services and average bank accounts • Advantages of establishing a banking relationship Introduction to Financial Services – Activity 2
  7. 7. FORMAL INFORMAL FINANCIAL FINANCIAL SERVICES SERVICES• Accounts • Payday lenders• Credit cards • Check cashing services• Loans • Rent-to-own stores• Investment vehicles • Pawn shops• Direct deposit • Title lenders• Wire transfers/ remittances • Loans from family/friends • Cultural savings clubs • Remittances offered through nonfinancial institutions Slide 1 – Formal and Informal Financial Services Lesson Reference: Introduction to Financial Services, Activity 2 – Overhead 1
  8. 8. HOW A BANK CAN SAVE YOU MONEYMonthly Fees without a Bank Monthly Fees with a Bank*• $80 to cash paychecks • $0 to directly deposit paycheck• $3.81 on money orders and • $0 to get cash from banks stamps to pay bills ATMs or make debit card• $15 to send money to family with a purchase wire transfer company • $0 to pay monthly bills using electronic bill payment • $5 to send money to family Monthly cost: $98.81 Monthly cost: $5.00 Annual cost: $1,185.72 Annual cost: $60.00 Annual Savings by Using a Bank: $1,125.72 Slide 2 – How a Bank Can Save You Money Lesson Reference: Introduction to Financial Services, Activity 2 – Handout 2
  9. 9. ADVANTAGES OF ESTABLISHING A BANKING RELATIONSHIPNearly everyone needs a bank account to help manage hisor her day-to-day money.Bank accounts can help you to:• Pay bills• Manage your money• Receive money• Send money to a friend or family member• Keep your money secure• Start building wealth• Earn interest Slide 3 – Advantages of a Banking Relationship Lesson Reference: Introduction to Financial Services, Activity 2 – Overhead 2
  10. 10. ACTIVITY 3 Banks, Yesterday and Today Overview • The many traditional financial services provided by a bank • Other expanded financial services provided by a bank • The impact of banks throughout the community10 Introduction to Financial Services - Activity 3
  11. 11. TRADITIONAL SERVICES OF BANKS • Checking Accounts • Savings Accounts • CDs (Certificates of Deposit) • Savings Bonds • Loans • Car • Home • Personal • Safe Deposit Boxes Slide 1 - Traditional Services of Banks11 Lesson Reference: Introduction to Financial Services, Activity 3 – Overhead 1
  12. 12. TRADITIONAL EXPANDED SERVICES SERVICES OF BANKS OF BANKS • Checking Accounts • Insurance Sales • Savings Accounts • Small Business • CDs (Certificates of Advising and Loans Deposit) • Investments • Savings Bonds • Credit Cards • Loans • Remittances • Car • Home • Personal • Safe Deposit Boxes Slide 2 - Expanded Services of Banks12 Lesson Reference: Introduction to Financial Services, Activity 3 – Overhead 2
  13. 13. FINANCIAL SERVICES MODERNIZATION ACT (1999) Transformed the banking industry. Eliminated many restrictions among companies in the securities, banking, and insurance industries. Results? • Banks may offer some insurance and investment services. • Investment and insurance companies may offer some traditional banking services. Investments are not insured by FDIC. Slide 3 - Financial Services Modernization Act13 Lesson Reference: Introduction to Financial Services, Activity 3 – Overhead 3
  14. 14. SOME COMMUNITY-RELATED SERVICES OF BANKS • Bank employees mentor students in areas of basic financial skills. • Bank employees serve on community organizations’ boards of directors. • Banks provide scholarships to students going into the banking profession.14 • Banks fund affordable housing construction.Some Community-Related Services Slide 4 - Lesson Reference: Introduction to Financial Services, Activity 3 – Overhead 4

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