ABCs of banking

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When you bank, you may come across terms that you hear over and over and have no clue what they mean. While we try to avoid such jargon, occasionally they slip through. In order to help you understand what they mean, let’s start with the ABCs!

ACH – Stands for automated clearing house. Think of this as where your money is “housed” or held when you use electronic payments or transfers. Getting a tax refund? ACH is the spot where your money is housed while it’s electronically transferred into your account.

Budget– This is a tool you can use to keep track of where your money is going. The more you know, the more you can save and have your money work for you.

CD – Certificate of Deposit. This is basically a special savings account. Think of a CD as savings you won’t touch for a while, but when you do, you’ll make money on your money with a higher interest rate.

Debit Card – This looks like a credit card but is connected to your checking account. Think of your debit card as cash. It helps you spend money without actual paper cash or checks while not adding debt to a credit card.

Direct Deposit – This is a payment option where your funds are electronically transferred into your checking or savings account instead of getting paid by a cash or by check.

Electronic Funds Transfer – Think of electronic payments or funds transfers as online, digital payments from one financial institution to another, or a merchant you pay from your bank account.

Financial Institution – Big words that mean your bank or credit union.

Guarantor – Sometimes you need a guarantor or co-signer when applying for a loan. This is the person who guarantees your payments if you cannot.

Hold – This refers to the length of time a check deposit can be “held” before the funds are credited to your account to ensure the check is authentic. If applicable, you will find hold information on your receipt after making a check deposit.

Interest Rate – Your interest rate is the amount of money (by percent) charged by a lender for the use of assets. Having a high interest rate for savings is good, as you’ll make more money, but when it comes to taking out a loan or mortgage, you want a low interest rate to reduce the amount you’ll pay.

Joint Account – Your checking or savings accounts can be privately yours or you are joint on it with someone you trust.

KPI – Key Performance Indicator. A measurable value that shows how effective an organization is at achieving goals. Many organizations use KPIs to help make smart strategic decisions for their businesses.

Loan or Mortgage Loan Officer – A fancy name for the person who is ready to help you apply for and receive a mortgage or loan. Professional loan officers help you get the best interest rates and terms.

Mobile Banking – Banking through your Consumers Credit Union app on your smartphone or device. Available on iOS through the App Store or on Google Play.

NSF Fee – If you don’t have enough money in your checking account to cover something you’ve bought or a bill you’ve paid, (we get it, it happens) a non-sufficient funds fee may be issued. This means your bank or credit union rejected your check or credit card payment, which can also cause a waterfall of more fees if you do not catch up.

Online Banking – Easy banking on your desktop, mobile phone or other smart device that connects you to all your accounts in one place. Most transactions you make in-person at your financial institution can probably be completed within your secure Online Banking account.

P2P – Peer-to-Peer or Payment to Person. Think transaction through Venmo or PayPal. You upload your debit or credit card to the P2P network and pay people over the Internet. Mobile banking makes P2P very easy.

Pending – Monetary transactions that have not yet been approved and posted are often labeled as “pending” when funds come in and out of your account.

Quandorum – If you’ve read this far and appreciate our definitions, please pay us a quandorum (compliment) in the comments below.

Remote Deposit Capture (RDC) – These are fancy words for taking a photo of your check and uploading it to your account through a mobile app.

Routing Number – A nine-digit code that’s also known as the transit or ABA number is a number that identifies your financial institution to others within the United States. The routing number for Consumers Credit Union is 272481839.

Share Savings or Checking – Share is the term credit unions use to showcase your ownership or membership at a credit union. When you invest $25 in Consumers (to open an account), you become part of the cooperative that makes credit unions so special. Your share stays in your account and brings you membership advantages daily (and is returned should you ever leave).

Teller Plus+ – Consumers’ innovative Interactive Teller machines in our offices or drive thrus that serve as both an ATM 24/7 or connect you to a teller for banking service from 9 a.m. – 7 p.m. weekdays and 9 a.m. – 1 p.m. on Saturday. Think of it like Facetime banking. Tellers are local, live and real time!

Unsecured Loan – A loan that is granted without property attached to it that would be given to your bank or credit union if you cannot pay the loan back.

Variable Rate – This is an interest rate that changes as the market or index fluctuates, which can affect your payments if it goes higher or lower.

Wire Transfer – You can move money electronically across a network of banks across the world in the same day with a wire transfer. The money cannot be stopped once it’s sent, which helps eliminate risk in a transaction.

Xenial – A positive relationship between two parties, like our members and team!

You – Helping you reach your financial goals and dreams is our mission at Consumers Credit Union.

Zillow – A website where you can find, buy and sell homes online. Get pre-approved today with a Consumers MLO (see Loan Officer).

Grey Equal Housing Opportunity logo NMLS# 414712

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  1. Lyndsey C. says:

    This is so cute and FUN!

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