EVALUATED “BY EDUCATORS, FOR EDUCATORS.” THANK YOU
TO THE FOLLOWING EDUCATORS FOR DEVELOPING
COMPONENTS OF THIS LESSON PLAN.
10‐12
Anticipatory Set & Facilitation: 50 minutes
Conclusion/Assessment Options: 45 minutes
Time does not include optional items.
Kimberly Knoche, Family and Consumer Sciences Educator, Forsyth, Montana
Glenda Seward, Family and Consumer Sciences Educator, Wellman, Iowa
NATIONAL STANDARDS LESSON PLAN OBJECTIVES
The curriculum is aligned to the following national standards: National Standards for Financial Literacy American Association of Family and Consumer
Sciences Council for Economic Education National Business Education National Jump$tart Coalition Common Core English Language Arts
Upon completion of this lesson, participants will be able to: Compare the characteristics of savings tools Analyze which savings tools are appropriate for
reaching different financial goals
MATERIALS
MATERIALS PROVIDED IN THIS LESSON PLAN
MATERIALS SPECIFIC TO THIS LESSON PLAN
BUT AVAILABLE AS A SEPARATE DOWNLOAD MATERIALS TO ACQUIRE SEPARATELY
DEPENDING ON OPTIONS TAUGHT
Savings Tools Presentation Planning 2.4.3.A1
Savings Tools reinforcement worksheet 2.4.3.A2
Letter to Jane 2.4.3.A3
Savings Tools Presentation Rubric 2.4.3.B1
Letter to Jane Rubric 2.4.3.B2
Savings Tools Vocabulary List 2.4.3.E1
Savings Tools Information Sheet 2.4.3.F1
4 of a Kind Labels 2.4.3.H1
Which Savings Tool Would You Use? 2.4.3.H2
4 of a Kind Answer Key 2.4.2.K1
Savings Tools Note Taking Guide 2.4.3.L1
Savings Tools Answer Key 2.4.3.C1
Savings Tools PowerPoint presentation 2.4.3.G1
Saving and Investing Multiple Choice Test Bank & Answer Key 2.4.0.M1 & C1
Internet access Labels Decks of cards Large sheets of paper Markers
External resources referenced in this lesson plan: Start Saving – Ways to Save, from the PBS Series Your Life, Your Money: http://pbs.org/your‐life‐your‐money
TAKE CHARGE TODAY RESOURCES
Similar lesson plan at a different level: None available
Optional lesson plan resources: Technology Integration Options Active Learning Tool
3.0.50 Tablet Applications for the Personal Finance Classroom
Active Learning Tool 3.0.52 True or False Active Learning Tool 3.0.12
CONTENT EDUCATOR MATERIALS PARTICIPANT READING
Materials to support educators when preparing to teach this lesson plan are available on the Take Charge Today website.
Savings Tools Information Sheet 2.4.3.F1
OPTIONAL ADVANCE INSTRUCTIONThis lesson is designed to be taught as a stand‐alone lesson. However, background content knowledge from the
following lesson plans is directly related to this lesson and may be helpful for participants.
Introduction to Depository Institutions 2.2.1 Lifelong Employment 2.3.7
LESSON FACILITATION
PREPARE
Visual indicators to help prepare the lesson INSTRUCT
Instructions to conduct the lesson facilitation
CUSTOMIZE
Potential modifications to lesson facilitation
VOCABULARY ACTIVITY
Savings Tools Groups
Approximate time: 5 minutes prior to instruction.
Materials to prepare: None
1. Break participants into groups of 3‐4. 2. Assign one savings tool to each group. Savings tools include checking
account, savings account, money market deposit account and certificate of deposit.
a. Participants will remain in these groups for the remainder of the lesson.
3. Instruct each group to engage in a 1‐minute discussion of what they know or have heard about their groups’ assigned savings tool.
Approximate time: 10 minutes Materials to prepare: Start Saving – Ways to Save video clip (URL found in the supplemental
resources section)
1. Show Part 4: Start Saving – Ways to Save, from the PBS Series Your Life, Your Money. This is part of a 6‐part series. Chapter 4 contains two sections: Ways to Save, with D. Woods and Saving for Retirement, with Maria Cortez. Only the first section (Ways to Save) should be shown for this lesson.
2. After the video, discuss how using savings tools helped D. Woods. Example questions include:
a. What methods did D. Woods use to save money? b. Do you agree with all of D. Woods’ financial decisions? Why or why
not? c. Why is it necessary to save money? d. If D. Woods had a job that paid her on a regular basis, would she
want to save as much money? e. If you were D. Woods, would you change any of the financial
decisions that she has made so far? 3. Explain to participants that D. Woods used various types of savings tools,
such as checking accounts, savings accounts, and Certificates of Deposit, to help her save money. Participants will learn about each of these savings tools and why they should be used throughout the remainder of the lesson.
RECOMMENDED FACILITATION OPTIONS There are two recommended facilitation options provided for this lesson. 1. Option 1: Small Group Presentations 2. Option 2: Savings Tools PowerPoint Presentation
Option 1: Small Group Presentations
Approximate time: 45 minutes
Materials to prepare: 1 Savings Tools Information Sheet 2.4.3.F1 per participant Optional: 1 Four of a Kind Answer Key 2.4.3.K1 Per group (4 groups total)
o 1 set of Four of a Kind Cards – Four of a Kind Labels 2.4.3.H1 are provided
o 1 marker o 1 large sheet of butcher paper o 1 Savings Tools Presentation Planning 2.4.3.A1 o Optional: Savings Tools Presentation Rubric 2.4.3.B1
1. Pass out one Savings Tools Information Sheet 2.4.3.F1 to every participant. 2. Read page one of the Savings Tools Information Sheet 2.4.3.F1 together as a
class. Stress key points: a. Each tool has different features and it is very important to choose
the appropriate savings tool to assist in reaching financial goals. b. Savings tools are ideal for emergency savings because they are
Rather than a deck of cards, place labels on index cards and laminate.
Use a talking avatar to convey key points. Refer to Technology Integration Options Active Learning Tool 3.0.50 for assistance.
insured. c. Understanding the features of savings tools will help individuals
choose the appropriate tool for their goals. d. Savings tools will vary between and within depository institutions,
making it very important to compare savings tools in order to find the best option.
3. Divide participants into small groups and assign each group one savings tool. a. If the Savings Tools Groups vocabulary activity was completed have
them continue working in that group. 4. Instruct each group to prepare a presentation about their assigned savings
tool that will be presented to the rest of the class. a. Groups should read the corresponding section (on page two) of the
Savings Tools Information Sheet 2.4.3.F1 and prepare a presentation explaining the various characteristics of the savings tool.
b. Provide each group with a Savings Presentation Planning 2.4.3.A1. Presentations should include all content prompted. This includes discussing the: definition, interest, liquidity, features, and any additional information about the savings tool.
c. Every member of the group should participate equally in the presentation.
d. Optional: Use the Savings Tools Presentation Rubric 2.4.3.B1 to score each group’s presentation.
5. Provide each group with a set of cards labeled with the ‘Four of a Kind’ labels 2.4.3.H1, a large sheet of butcher paper, and a marker.
a. A Four of a Kind 2.4.3.H1 set of cards contains each of the 4 savings tools as well as 5 characteristics of each savings tool.
6. Instruct each group to create a 6x5 grid on their butcher paper and label the top of the grid with the following labels: Savings Tools, Definition, Interest, Accessibility, Feature, and Feature. The Savings Tools Note Taking Guide 2.4.3.L1 can be used as a guide to complete the chart.
a. The butcher paper should resemble the following: Savings Tools
Definitions Interest Liquidity (accessibility)
Feature Feature
7. Have participants work in their groups to organize the cards correctly onto
the butcher paper grid. a. To provide additional guidance, provide participants with the grid
label color‐coding information, as follows: i. Savings Tools = maroon ii. Definition = pink iii. Interest = gold iv. Liquidity (accessibility) = blue v. Features = green
b. Some characteristics may apply to more than one tool. Match a card to the tool best described by the card.
Reduce instruction time by making the charts in advance.
8. Instruct each group to present their section to the class. 9. After each group is finished with their presentation:
a. Discuss the information presented and add any missed information or clarify any possible confusion.
b. Instruct groups to reorganize their Four of a Kind Cards 2.4.3.H1 (if needed) on the butcher paper according to their new knowledge regarding each savings tool.
10. After all groups have presented, ask the groups to re‐evaluate their butcher paper, making sure all characteristics correlate with the correct savings tool.
a. Display the Four of a Kind Answer Key 2.4.3.K1 to have groups check their butcher paper. Or, have each group check their butcher paper using the Savings Tools Information Sheet 2.4.3.F1.
11. Instruct participants to work as a group to organize the four maroon savings tools cards from the most liquid to the least liquid. Discuss.
12. Instruct participants to work as a group to organize the four maroon savings tools cards from highest interest rate to the lowest interest rate. Discuss.
a. Stress that higher interest rates are a trade‐off for lower liquidity.
Option 2: Savings Tools PowerPoint Presentation
Approximate time: 30 minutes
Materials to prepare: 1 Savings Tools PowerPoint presentation 2.4.3.G1
1 Savings Tools Note Taking Guide 2.4.3.L1 per participant
Present the Savings Tools PowerPoint presentation 2.4.3.G1. Provide each participant with a Savings Tools Note Taking Guide 2.4.3.L1. 1. Slide 1: Savings Tools 2. Slide 2: Types of Savings Tools
a. There are four common types of savings tools that will be featured in this lesson.
3. Slide 3: Ideal for Storing Emergency Savings a. Ask participants how a consumer will know if their depository
institution offers secure accounts. i. They are insured by the Federal Deposit Insurance
Corporation or the National Credit Union Association. 4. Slide 4: Savings Tools Characteristics
a. The goal is to determine the savings tool most appropriate for reaching a financial goal.
5. Slides 5‐6: Checking Account a. Ask participants to determine common ways to access funds in a
checking account. i. Writing checks, using a debit card or withdrawing cash from
the account. b. Checking accounts may have minimum balance requirements, they
may charge transaction fees, and there can be limits on the number of checks that can be written each month.
c. Checking accounts are not recommended as the only account used to save money because they do not typically earn interest.
Have participants use an online graphic organizer to identify the definition, interest, liquidity and features of each tool. Refer to Technology Integration Options 3.0.50 for assistance.
After the presentations, have participants complete their Savings Tools Note Taking Guide 2.4.3.L1.
6. Slides 7‐8: Savings Account a. Ask participants what are common ways to access funds in a savings
account? i. Funds may be accessed or transferred by ATM, telephone,
and on the internet. b. They are effective for storing emergency funds because the money is
not as accessible as a checking account yet still very liquid. 7. Slides 9‐10: Money Market Deposit Account
a. Ask participants which would typically earn a higher interest rate. An account with a $10,000 or $2,500 balance.
i. The account with the $10,000 balance because the higher the balance, the higher the interest rate.
b. They are less accessible than savings or checking accounts because they usually have a very limited number of transactions allowed each month. Because of these restrictions, interest rates are often higher.
8. Slides 11‐12: Certificate of Deposit a. Higher interest rates are usually paid for money saved for longer
periods of time. b. Ask participants why a depository institution would typically offer a
higher interest rate for a CD with a longer time period or more money saved.
i. The depository institution has access to those funds for a longer period of time.
9. Slide 13: Matching Savings Tools to Goals a. There are several factors to consider when determining the most
appropriate savings tool for your financial goal. 10. Slide 14: You Decide: Which Tool is Best
a. Ask participants which tool they would recommend for Avery. i. A savings account is the most appropriate because the funds
are easily accessible in case of emergency. b. Ask participants which tool they would recommend for Javier.
i. A money market account is appropriate because the funds will be earning a higher interest rate with easier access to the funds than a CD. However, if Javier does not have the minimum balance ($1,000) than he may have to start with a savings account and work into a money market account.
11. Slide 15: Depository Institutions a. In addition to analyzing the features of a savings tool, individuals
should also closely examine different depository institutions. b. Terms and conditions for each account may vary such as interest
rates offered, fees, minimum balance requirements, etc. c. Remind participants that they are not limited to use only one
depository institution. 12. Slide 16: Liquidity
a. Direct participants to look at the graphic that illustrates that in general, the more liquid a savings tool is, the lower the interest rate it earns. The opposite is also true; the less liquid a savings tool is, the higher the interest rate it usually earns.
b. Higher interest rates are a trade‐off for lower liquidity. 13. Slide 17: Summary
a. By understanding the features of different savings tools, an individual can choose which tools would best help them reach their financial goals.
CONCLUSION OPTIONS There are two conclusion options provided for this lesson. 1. Option 1: Four of a Kind Activity 2. Option 2: Which Savings Tool Would You Use?
Option 1: Four of a Kind Activity
Approximate time: 20 minutes or longer depending on the number of rounds completed Materials to prepare: Per group of 4:
o 2 sets of Four of a Kind Cards – Four of a Kind Labels 2.4.3.H1 are provided
o Optional: 1 Four of a Kind Answer Key 2.4.3.K1 Instructions: 1. The object of the activity is to get a “four of a kind” with four cards
describing the same savings tool. a. For example, if a player is collecting Certificate of Deposit cards,
he/she would have to have four of the six following cards: i. Certificate of Deposit ii. Used for a fixed period of time iii. Interest rate will vary depending upon the specified time
length and amount deposited iv. Access to the funds deposited is restricted v. Time length usually ranges from seven days to ten years vi. Penalties are most likely assessed if the funds are withdrawn
early b. Each row of the Four of a Kind Answer Key 2.4.3.K1 describes the six
eligible cards for each savings tool. 2. Divide the participants into groups of four. 3. Provide each group with a set of cards labeled with the ‘Four of a Kind’ labels
2.4.3.H1. 4. Each group should identify a dealer who will deal four cards to each player,
put the rest of the cards face down as the draw pile and turn one card face up to be the discard pile.
5. For each player’s turn, the player will draw a card from either the draw pile or the discard pile.
a. The player will determine if that card is a characteristic of the savings tool for which they are trying to get four of a kind for.
b. If they want to keep the card, they discard a different card and it is the next person’s turn. If they do not want to keep the card, they discard it and it is the next person’s turn.
c. Players must always have four cards in their hands at all times. 6. Rotate to the next player.
Visit the Take Charge Today website for a video classroom demonstration of this activity.
A helpful tip for participants is to look at the label colors. A “four of a kind” for the same savings tool occurs when each labeled card is a different color with the exception of green (they may have up to 2 green cards in a “four of a kind.”
Simplify the activity by adding Jokers as wild cards.
Provide participants with the Four of a Kind Answer Key 2.4.3.K1 the first few rounds of play to provide additional support.
7. To win, a player must say “four of a kind” during his/her turn after collecting four of a kind.
a. They must have four cards describing the same savings tool. b. Verify the four of a kind by checking that all cards are from the same
savings tool row of the Four of a Kind Answer Key 2.4.3.K1.
Option 2: Which Savings Tool Would You Use?
Approximate time: 15 minutes Materials to prepare: 1 set of Which Savings Tool Would You Use? 2.4.3.H2 cards 1. Divide participants into small groups. 2. Randomly choose a Which Savings Tool Would You Use? 2.4.3.H2 card and
read it to the class. 3. In small groups, have participants determine what savings tool is the most
appropriate for that scenario. a. Consider having groups write 1‐2 reasons why they selected the tool
they did on the back of the Which Savings Tool Would You Use? 2.4.3.H2 card.
4. Ask groups to identify why they selected the tool they recommend. 5. Repeat until all Which Savings Tool Would You Use? 2.4.3.H2 cards have
been discussed. Discussion points: Mariah and the Twins
a. 2‐year Certificate of Deposit – they don’t need the money and the interest rate will likely be the highest available.
Conner and Lisa a. Money Market Account – to earn interest on the money while
waiting to buy the furniture. Aran
a. Money Market Account – this will allow him to make regular deposits while earning some interests in the 2‐years he is saving the money.
Brittany a. Checking Account – because of the accessibility and the ability to pay
bills directly from the account. Bryan
a. Savings Account – Good accessibility in case of an emergency. Amani and Grace
a. Savings Account, possibly evolving into a Money Market Deposit Account when they get enough money saved for the minimum deposit. They need it to be accessible and have the option to make additional deposits.
ASSESSMENT OPTIONS There are two assessment options provided for this lesson. 1. Option 1: Reinforcement Worksheet 2. Option 2: Letter to Jane
Have groups use a brainstorming/ discussion tool to identify which savings tool they would use and why. Refer to Technology Integration Options Active Learning Tool 3.0.50 for assistance.
Provide each group with all or one Which Savings Tool Would You Use? 2.4.3.H2 as an alternative.
Give each group 1‐2 scenarios and have them create an avatar explaining the situation. Play the avatars for the class and conduct small group discussions to make recommendations. Refer to Technology Integration Options Active Learning Tool 3.0.50 for assistance.
Option 1: Reinforcement Worksheet Approximate time: 20 minutes Materials to prepare: 1 Savings Tools 2.4.3.A2 per participant 1. Complete the Savings Tools 2.4.3.A2 reinforcement worksheet.
Option 2: Letter to Jane Approximate time: 45 minutes Materials to prepare for assessment option 1: 1 Letter to Jane 2.4.3.A3 per participant 1 Letter to Jane Rubric 2.4.3.B2 per participant
1. Complete the Letter to Jane 2.4.3.A3 worksheet and write a short letter
using the Letter to Jane Rubric 2.4.3.B1 to describe choices made.
Use the True or False Active Learning Tool 3.0.12 to reinforce key concepts.
1 Certificate of deposit An account at a depository institution that is used for a fixed period of time and allows restricted access to the funds deposited
2 Checking account An account that allows quick access to funds for transactions
3 Depository institution Businesses that provide financial services
4 Liquidity How quickly and easily an asset can be converted into cash
5 Money market deposit account
A account at a depository institution that usually has minimum balance requirements and tiered interest rates
6 Savings account An account at a depository institution that is designed to hold money not spent on current consumption
7 Savings tools Accounts offered by depository institutions whose main purpose is to help people manage their money
8 Tiered interest rate The amount of interest earned depends on the account balance
Approximately one set of cards will be needed per group of four participants. The following supplies are needed per group: 1 deck of playing cards (does not need to be a complete deck) OR 24 3x5 index labels Print one set of 4 of a Kind Labels 2.4.3.H1
o Labels are formatted to be printed on a sheet of 1.83 x 3.06 labels. o Labels are provided in color. However, the color of each label is noted in the bottom left corner if
the cards are printed in black and white. Preparation:
Place one 4 of a Kind Labels 2.4.3.H1 on each playing or index card. There are 24 labels total. Reference the 4 of a Kind Answer Key 2.4.3.H1 for a list of all labels included in a set. If using playing cards:
o The focus of the activity is on the savings tool described by each label, not the playing card. Therefore, it is okay to cover the playing cards numbers and symbols.
o Discard any extra cards (so the only cards remaining in the set are those labeled).
Directions: Use Savings Tools Information Sheet and this guide to plan the group savings tools presentation. What is your savings tool? Characteristics of your savings tool:
Choose at least two of the following discussion prompts to address in your presentation: At what point in the life cycle would this tool be used and why? What is a situation when this tool would be effective for reaching a financial goal? When would the tool not be a good fit for reaching a financial goal? When researching this tool at a depository institution, what types of questions should consumers ask? Plan your presentation:
Directions: For each of the following scenarios, determine which savings tool should be used and explain
your decision. (2 points per question)
17. Glenn recently graduated from college and accepted his first career position. He received a signing bonus of $1,000 for his new job. He plans to buy a new car in one year and has decided to save that $1,000 to use as a down payment on a new car. Which savings tool would you recommend Glenn utilize and why?
18. Micah is a high school senior who works part‐time earning $500 per month. He is responsible for paying several of his own expenses including entertainment, automobile insurance and eating out. He needs a flexible account which allows him easy access to his money. Which savings tool would you recommend Glenn utilize and why?
19. José and Gabriela were recently married. They received $1,500 from wedding presents and want to use the money wisely. They have decided to save $1,000 and use it to take a vacation next year for their one‐year anniversary. They want the remaining $500 to be the start of an emergency fund for their new life together. Which savings tool(s) would you recommend José and Gabriella utilize and why?
20. Roland is a sophomore in high school. He has started his first job and is paying himself first by setting aside 20% of each paycheck (approximately $100 per month). Roland is saving this money for future continuing education expenses when he graduates high school. Which savings tool(s) would you recommend Roland utilize and why?
Directions: Answer the questions that follow. After the questions have been answered, write a letter to Jane
explaining the savings tool choices.
1. Jane recently moved to a new city. She is adjusting her current spending plan to fit her new lifestyle. She needs to find new depository institutions and savings tools to fit her new financial needs. She already has a checking account to help her manage her everyday spending. She has $3,000 she wants to use as an emergency fund. Although, she does not plan to use this money very often, Jane knows unexpected expenses always occur in life. Therefore, she wants to be able to have quick and frequent access to the account with the $3,000 emergency fund. Jane also has $500 that she wants to save to buy a new computer in one year; her goal is to not use this money in the next year, so she wants to get the highest interest rate she can. Which savings tool(s) would you recommend Jane utilize and why?
2. Jane has been researching depository institutions in her new city. It is her goal to find a depository institution close to either her apartment or her place of work, offering both in‐person and ATM services. From these criteria, she has narrowed her search down to two depository institutions, Many Choices Credit Union and the Smart Savings Bank. She has $3,000 she wants to use as an emergency fund. She does not plan to use this money often but realizes she may have unexpected expenses. Jane wants to be able to have quick and frequent access for this account. Jane also has $500 that she wants to save to buy a new computer in one year. Her goal is to not use this money in the next year, so she wants to get the highest interest rate she can. She knows she wants to utilize either a Savings Account, Certificate of Deposit, or Money Market Deposit Account.
Complete this table by referring to the banking brochure comparison information below to determine Jane’s best options for saving her money.
Which Savings Tool (savings, money market deposit or certificate of
deposit)?
Which depository institution (Many Choices or Smart Savings Bank)?
What type of account within the selected depository institution
would be used?
$3000 Emergency Fund
$500 Computer Saving
3. Using the answers on your table in question two, write a letter to Jane explaining the savings tools, depository institutions and accounts that you would recommend for her. View the Letter to Jane Rubric 2.4.3B2 for detailed instructions.
Banking Brochure Comparison Information Savings Accounts
Directions: Write a letter to Jane explaining the savings tools, depository institutions and accounts that you would recommend for her. The letter should answer the following questions: Which savings tool did you recommend Jane use to save her $3,000 emergency fund? Why did you
choose this savings tool and depository institution? Which account did you recommend Jane use to save her $500 computer fund? Why did you choose this
savings tool and depository institution?
Exemplary Satisfactory Unsatisfactory No Performance
Score
Content Both required questions are
answered An accurate and thoughtful
justification is provided for each savings tool, depository institution and account choice.
12‐9 8‐5 4‐1 0
Quality of Letter Easy to understand Accurate (no errors in content
or grammar) Well‐organized with an
introduction, body and conclusion
Presented as a one‐page letter, typed, double‐spaced, 12‐font and 1‐inch margins
Depository ins tu ons offer secure accounts to store money that is saved. These accounts are known as savings tools.
There are four common types of savings tools: checking accounts, savings accounts, money market deposit accounts,
and cer ficates of deposit, ordered from lowest to highest rates of interest typically paid. Cer ficates of deposit (CD)
generally pay the highest rate of interest, but they have specific maturity dates (for example, 6 months, 12 months, 24
months). This means the bank agrees to pay a specified interest rate for the me period, but if you want to withdraw
your funds early (prior to the full maturity) you would typically pay a penalty in the form of lost interest.
Savings tools are ideal for storing emergency savings because:
Savings tools are secure ‐ As long as the specific depository ins tu on is insured and you stay within the coverage
limits your money is secure when deposited in one of the four savings tools.
Savings tools are liquid – Liquidity is defined as how quickly and easily an asset can be converted into cash. The degree of liquidity varies for each savings tool, but in general, it is quick and easy to withdraw money.
Each savings tool has different features including interest rates and liquidity. View the “Choosing a Savings Tool” table to
learn about the features of each tool.
Choosing a Savings Tool
When determining which savings tool is the most
appropriate for your financial goal consider:
Amount of funds you have available
Purpose of the money saved
When the money saved is needed
Liquidity of the savings tool Interest earned Specific requirements of the savings tool,
such as minimum balance requirements
and me restric ons
Fees charged Other factors specific to your financial
goals
It is important to match your specific needs to the appropriate
savings tool. For example, if you would like to build emergency
savings, liquidity is important so the money must be easily
accessible. A savings account would work well to reach this goal
because the funds in a savings account are very liquid. A
cer ficate of deposit (CD) would most likely not be the most
appropriate savings tool because the funds in a CD aren’t
accessible (without penalty) un l the maturity date.
In addi on to choosing a specific type of savings tool, you will also
want to analyze the features of specific savings tools among
depository ins tu ons. The terms and condi ons (such as interest
rates, fees, minimum balance requirements, etc.) vary between
An account at a depository ins tu on that provides an easy method for withdrawing or deposi ng money.
Some earn interest but most do not. If a checking account does earn interest, the interest rate is usually the lowest of any of the savings tools.
The most liquid of all the savings tools. A checking account allows you to deposit money for safe keeping and then use that money at any me by wri ng checks, using a debit card, and/or withdrawing cash from the account.
Popular among consumers, because checking accounts reduce the need to carry large amounts of cash and are easy to use and manage.
Different types of checking accounts are available and the requirements for each are different. Some require a minimum balance, charge transac ons fees, or have limits on the number of checks wri en each month. Learn all of the requirements and restric ons before opening a checking account.
Also known as a share dra account at a credit union
Because checking accounts are very liquid and most likely don’t earn interest, they are not recommended as the only account in which to save money.
Savings Account
An account at a depository ins tu on that is designed to hold money not spent on current consump on.
Earn interest, but have lower interest rates compared to other savings tools except checking accounts.
More liquid than everything except checking accounts. Money is easily accessed via the depository ins tu on or an ATM.
Great account for storing emergency savings funds
Savings accounts may help a person save money easier than a checking account, because the money isn’t as accessible.
The number of monthly withdrawals may be limited. If the withdrawal limit is reached, the owner of the account will be charged a fee.
There are different types of savings accounts with different features and some may require a minimum balance. Learn about all requirements, restric ons, and fees before opening a savings account.
Also known as a share account at a credit union
Money Market Deposit Account
An account at a depository ins tu on that usually has minimum balance requirements and ered interest rates.
Offer ered interest rates. Tiered interest rates mean the amount of interest earned depends on the account balance. For example, a balance of $10,000 may earn a higher interest rate than a balance of $2,500. Interest rates for all deposited fund amounts are usually higher than savings accounts.
Less liquid than checking and savings accounts, because money market deposit accounts have minimum balance requirement and are limited to a certain number of transac ons each month.
Similar to a savings account but earn higher interest
rates and has higher minimum balance/deposit
requirements.
Customers are usually required to deposit a
minimum amount to open a money market deposit
account (typically $1,000) and maintain that
minimum balance.
Cer ficate of Deposit (CD)
An account at a depository ins tu on that is used for a fixed period of me and allows
restricted access to the funds deposited.
Varies depending upon the specified me length and amount of money deposited. In most cases, the longer the length of the CD and the higher the deposited funds, the higher the interest rate will be.
The least liquid savings tool. If the funds are withdrawn before the end of the designated me period, the owner will be assessed penalty fees.
Deposits have to be held for a certain length of me;
me periods usually range from seven days to ten
years or more. However, specific me periods
offered will vary between depository ins tu ons.
Deposits can range from $100 to $250,000.
If funds are held for the designated me period, then
