Banking Basics

Introduction

Millions of Americans use banks, which are financial institutions that offer safe, secure, and convenient services to help people save money and build a better financial future. In this lesson, you’ll learn about the different types of banks, the services they offer, and how to choose the right bank for your needs. You’ll also learn some tips for working with a bank.

Types of Banks

Depending on where you live, you may have a number of banks to choose from. Some banks are very large, with branches all over the country, while others are small and locally owned. Some banks have branches in grocery stores and shopping malls, while others are only located in big cities or small towns. Some common types of banks include:

  1. Commercial Banks: These are the most common type of banks and offer a range of services to individuals and businesses. They accept deposits, make loans, and provide other financial services.
  2. Savings and Loans Associations: These banks focus on savings accounts and home loans. They often have lower fees and higher interest rates on savings accounts.
  3. Credit Unions: These are not-for-profit financial cooperatives that are owned by their members. They often have lower fees and interest rates than commercial banks.

 

Services Offered by Banks

Banks offer a wide range of services to help you manage your finances. Some common services include:

  1. Checking and Savings Accounts: These accounts allow you to deposit and withdraw money, pay bills, and earn interest on your deposits.
  2. Loans: Banks offer a variety of loans, including personal loans, car loans, and home loans.
  3. Credit Cards: Banks issue credit cards that allow you to make purchases and pay them off over time.
  4. Investment Services: Some banks offer investment services, such as retirement accounts, stocks, and bonds.

 

Choosing the Right Bank

When choosing a bank, there are a few factors to consider:

  1. Location: Choose a bank that is conveniently located for you.
  2. Fees and Interest Rates: Compare the fees and interest rates of different banks to find the best deal.
  3. Services: Make sure the bank offers the services you need, such as checking and savings accounts, loans, and investment services.

 

Working with a Bank

When working with a bank, there are a few tips to keep in mind:

  1. Ask for Help: If you don’t know who to talk to, ask for help. The bank staff are there to help you.
  2. Read before You Sign: Don’t sign anything you don’t understand. Ask questions until you have the answers you need.
  3. Get Written Information: Ask for written information to take home and review.

 

Further Reading

Lesson Content