Office of Enrollment Management

Banking 101

Banking 101

Banks and credit unions offer services to individuals and businesses. You are their primary customer. So it is important to know that you can shop around to find the bank or credit union that works best for you.

Banks usually have more advanced mobile apps and technology, provides more branches and ATMs nationwide, tend to have stricter rules and less flexibility with customer service, offers more options for banking, retirement, and investments and make a profit.  Credit unions are non-profit and owned by members, offer fewer options than commercial banking, lower fees and better interest rates on loans and saving accounts, provide thousands of shared CO-OP branch locations and surcharge free ATMs

Banks are for-profit institutions while credit unions are non-profit. Be sure to consider the cost of holding an account, location and availability of branches, and online accessibility when choosing where to bank.

Most banks and credit unions offer several checking and savings account options. Read the terms and conditions for the types of accounts to ensure it will fit your needs.  Students are often able to open a student account that has reduced or no monthly maintenance fees. Remember you are their customer and they want your business. 

After the Great Depression, the federal government began insuring banks and credit unions.  Currently, your checking and savings accounts are insured for up to $250,000 by the FDIC (banks) and NCUA (credit unions). This insurance gives you confidence that money you deposited in the financial institution will be available when you decide to use it. 

Checking versus Savings Accounts

A checking account allows the owner to deposit and withdraw money daily with no limitations. Savings accounts allow the owner to deposit funds and earn interest on the money kept in the account. Savings accounts usually earn a small amount in interest. There can be limits to the number of withdrawals from a savings account.

Learn more about the difference between checking and savings accounts. 

Avoid Common Banking Fees

One way that banks and credit unions make money is by charging fees. Many of these fees can be avoided by understanding the type of account you have. 

Monthly Maintenance fee

Choose an account that is free or that you know you can keep the requirements. Some requirements may mean only banking online, using the ATM, or maintaining a minimum balance. 

Overdraft Fees or Non-Sufficient Funds

Knowing how much you have in your account at all times will help you avoid overdraft and non-sufficient fees. Utilize low balance alerts by activating them. These fees can be avoided by knowing what expenses are regularly drafted and when money will be deposited.

Learn to balance your checkbook. 

Out of Network ATM Fees

Save money by only using ATMs that are considered in-network.  Many bank and credit union apps show the location of in-network ATMs. 

Avoid fees to keep money in your pocket. Educate yourself on what fees your financial intuition charges.