Fill - Free fillable - Savings Tools Lesson Plan 2.4.3 PDF form

2.4.3.F1

©TakeChargeToday–August2013–SavingsTools–Page1

FundedbyagrantfromTakeChargeAmerica,Inc.totheNortonSchoolofFamilyandConsumerSciencesTakeChargeAmericaInstuteatTheUniversityofArizona

SavingsTools



AdvancedLevel

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maturi ty)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

depositoryinstuons.



2.4.3.F1

©TakeChargeToday–August2013–SavingsTools–Page2

ChoosingaSavingsTool

 Deﬁnion Interest Liquidity

(accessibility)

Features

Checking

Account

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

thereislimitedriskandnofees.



Page|20

2.4.3.A1



FundedbyagrantfromTakeChargeAmerica,Inc.totheNortonSchoolofFamilyandConsumerSciencesTakeChargeAmericaInstituteatTheUniversityofArizona

SavingsToolsPresentationPlanning



TotalPointsEarned



GroupMembers



 TotalPointsPossible



Date



 Percentage



Class



Directions:UseSavingsToolsInformati o n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:



Section TalkingPoints Presenter

Toolanddefinition 

Interestandliquidity 

Features 

Answerstoprompts 

Definition Interest Liquidity Features

Page|19

2.4.3.B1



SavingsToolsPresentationRubric



TotalPointsEarned



GroupMembers



18 TotalPointsPossible



Date



 Percentage



Class



Directions:UsethisrubrictoevaluateeachgroupSavingsToolspresentation.



Exemplary Satisfactory Unsatisfactory No

Performance

Score



Presentation

 Eachindividualwaswellpreparedfor

theirportion

 Thegroupworkedwelltogether

 Eachindividualpresentedaportionof

thepresentation

6‐5 4‐3 2‐1 0



Content

 Allessentialcontentpointsfromthe

SavingsPresentationPlanningGuide

werepresentedincluding:

o Definition

o Interest

o Liquidity(accessibility)

o Features

o Anyadditionalinformation

aboutthesavingstool

9‐7 6‐4 3‐1 0



QualityofPresentation

 Easytounderstand

 Accurate(noerrorsincon tentor

grammar)

 Well‐organized

3 2 1 0



TotalPointsEarned



TotalPointsAvailable

18

Percentage





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