Banking Basics: Things New Savers Should KnowDated: October 15, 2021
Opening your first account can be a daunting experience. There are so many products to learn, and a variety of services offered! Of course, you can take your savings journey at your own pace with just a little bit of knowledge to get you started.
Here are five things we think new savers at Evergreen Credit Union should know:
ATM Card vs. Debit Card vs. Credit Card
Once you start saving, you are going to want a way to withdraw your money. However, not all cards are created equal.
ATM Cards are used to take money from your Savings Account. Purchases can’t be made with them. Instead, they are used to withdraw that cash from an ATM. Watch out though, there could be ATM fees for using the machine. You can use the Alliance One Network to avoid ATM fees on Evergreen Credit Union cards.
Debit Cards are used to make purchases from your Checking Account. They can be used at places like a gas station, or online shopping sites like Amazon.com. Debit Cards use your own money to buy things, but if you spend more money than you have available, there can be overdraft fees.
Credit Cards can also make purchases. The spending limit is set when you open the card. You can spend up to the Credit Card limit but the money is “borrowed.” You need to pay it back when it is due. Interest will be charged for any outstanding balances not paid by the due date, so if you make the minimum payment and there is a balance left on the card, you are paying additional money. Credit Cards can help build your credit score by making timely payments; however, they can hurt your credit score if you make late payments. Understand your obligations fully, and what interest you can be charged, before applying for a Credit Card.
Check Your Account Often
Your account will generate statements on a monthly or quarterly basis. This is a running log of all your transactions. Take the time to open your statement each time, whether paper or electronically, to stay up-to-date with your spending habits. Many institutions have online banking available – online banking can be used to check your balances and transaction history whenever you want to. Get in the habit of looking before you spend. Diligently watching your account can also help you avoid fees and catch fraud if your Debit or Credit Card is lost or stolen.
Available Balance and Current Balance
When reviewing your account balances, you will see two different numbers: Available Balance and Current Balance. While both are talking about your money, your Available Balance will tell you what you have left to spend.
Your Available Balance is your account minus pending (or secured) transactions – pending transactions are debits you have authorized, but they haven’t taken the funds yet. If you try spending more than your Available Balance, you may have to pay overdraft fees.
Deposit Checks As Soon As Possible
We can admit it – paper checks are a little old school. However, if you get a check, deposit it as soon as possible. Think of checks as an “IOU” that are good for a specific amount of time, anywhere from 90 Days to one year. The money does not leave the person who wrote the check’s account until it is deposited by you. If you forget to cash the check in a timely manner, it’s game over, and you will not be able to do anything with the check unless it is re-issued.
Ask your employer about direct deposit if you have payroll checks. Your account can have direct deposits automatically made. You do not have to have a Checking Account to receive these deposits, though you may want one to spend the money. Direct deposit avoids the check cashing dance and gets you your money as fast as possible.
If someone gives you a personal check, don’t forget that Remote Deposit services are available to cash your check from home. Follow any on-screen instructions for signing the back of the check to make sure it is accepted. However, keep an eye out for check scams, and always bring any checks you are suspicious of to your financial institution. They can help you determine if a check is legitimate: remember, you can be held liable for bounced or fictitious checks.
Consider Sub Shares for Long Term Savings
Your Savings Account can follow you for life. At a credit union, once you are a member, you are always a member! This means that money saved today becomes your money available for tomorrow – or any day far beyond that. If you are looking to save for a long-term goal, like college or your first car, ask about opening a Sub Share or secondary savings account. Sub Shares allow you to divide out your Savings into a different “bucket” so you remember not to touch it. Automatic transfers can help you save little by little by moving your money automatically too, so if you have a goal in mind, let us know!
Do you have a question about a different product of service? We would love to help: call or text us at (920) 729-2999. As a member of a credit union, you are a member owner, and we are here to serve you. No age is too young to open a Savings Account, but those under the age of 18 will require a parent or guardian.
Evergreen Credit Union membership is open to everyone who lives, works, or attends a 2 or 4 year college in Outagamie, Waupaca, Waushara, Calumet, or Winnebago counties in Wisconsin. Information valid as of 10/15/21. Terms and availability may vary by financial and utility providers. Please consult your financial institution for eligibility and rates.