BANKS & CHECKING ACCOUNTS
A newly arrived student should always open a bank account as soon as possible. It will not only assure the safe and quick deposit of foreign checks, but it will also free the student from carrying cash at all times. Most people in the United States do not carry large sums of cash on their person or keep large amounts of money in their apartment. Cash is easily stolen and seldom recovered. Money should be deposited in a bank as soon as possible.
CHECKING ACCOUNTS
A checking account is a convenient way to pay for large purchases and to pay your monthly bills. The canceled check is a legal receipt for bills paid. To open an account, go to the bank of your choice where the receptionist will direct you to a person who can explain the services available. You will be required to present your passport or driver's license when you open your account. Some checking accounts accrue interest similar to a savings account.
CHECKS
After you open a checking account, you will be given numbered checks imprinted with your name, address, telephone number, account number, and driver's license number (if desired). You may then write checks against the balance in your account. Always use ink to write checks so the information on it can't be changed or erased. When the bank receives the check, the amount is deducted from your account balance. The bank will provide you with a check register in which you should keep a record of all deposits made and all checks written. This allows you to figure the amount of money available in your account. It is very important for you to keep a record of how much you spend and how much you have in your account.
TO KEEP YOUR CHECKBOOK BALANCED: ALWAYS WRITE IN THE CHECK NUMBER,
THE DATE, TO WHOM THE CHECK IS WRITTEN, THE AMOUNT,
AND THE NEW BALANCE IMMEDIATELY AFTER USING A CHECK!
HOT CHECKS
A "hot check" is commonly used slang, and means that there are insufficient funds in your checking account to pay for the amount of the check. If you spend more money than you have in your checking account, your account will be "overdrawn" and your "hot" check will be returned to the person or company to whom you gave it. You will be charged a penalty fee by both the bank and the person or company to whom you wrote the check. These "hot check" fees are usually at least $15, most are $25. You must immediately "cover" the "hot check" by taking cash to the person or company to whom you gave the check. If you do not, you can be fined up to $1,000 and/or placed under arrest. You may also find that your "check-writing rating" is adversely affected and some businesses may no longer accept checks that you write. It is a serious matter to issue a check without having sufficient funds in your checking account.
MONTHLY STATEMENT
Each month the bank will send you a copy of all the deposits you have made and all the checks that have been subtracted from your account during the previous month. You should compare this statement to your register to ensure accuracy. If you have any questions about your statement, the bank will be happy to help. Some banks will return all your canceled checks with your statement; others will send only the statement and keep the cancel checks. The statements and cancel checks constitute legal receipts for payments made, so you should always keep them for your records.
IDENTIFICATION
Most stores require at least one kind of identification before accepting your check.
NOTE: An abbreviation often used for "identification" is "ID" When someone wants your "ID" he or she is asking for your identification.
A driver's license is the most common form of identification, but sometimes a passport is acceptable. A Texas Identification Card from the Department of Public Safety may be used in lieu of a driver license. Your Brookhaven College identification and major credit cards also are helpful for identification.
CASHING CHECKS FOR CASH
You may get cash from your checking account by writing a check payable to cash at your bank. Most grocery stores provide check-cashing privileges for their customers but you may need to apply for a check cashing card before you can cash a check. Proper identification is always required, and there is usually a charge for cashing a check except when you go to the bank where you maintain your account.
SAVINGS ACCOUNTS
You may want to open a savings account if you have several hundred dollars more than you need to pay your immediate expenses. Banks pay interest on the balance of a savings account and you may draw funds from a savings account or transfer funds from your savings account to your checking account.
CERTIFICATE OF DEPOSIT
A certificate of deposit (CD) is a good investment if you are certain that you will not need the money for a specific period of time. Money must be deposited into a CD account for a designated period of time, usually 90 days, one year, or more. The interest paid on a CD is higher than that paid on a regular savings account.
ATM CARD (Automated Teller Machines)
These cards are issued by the bank in which you have your savings and/or checking account. Cash can be instantly withdrawn from ATM machines 24 hours a day, but there may be a charge if you do not use the ATM at your bank. You can make deposits or check the balance in your account, but there may be an extra service charge. Never allow anyone to have access to your Personal Identification Number (PIN) issued by your bank, and care must be taken to prevent the ATM card from being lost or stolen. If this does happen, the bank should be notified immediately.
CREDIT CARDS
Credit cards are popular but sometimes difficult for international students to obtain. To qualify for a major credit card, you need to have a seizable annual income and usually to have established credit in some way by borrowing money or purchased an item on credit and made the agreed upon payments in a timely manner. You may wish to apply for a major credit card in your own country, rather than in the US There are several major credit cards American Express, Visa, MasterCard and Discover. There are also a number of minor credit cards issued by department stores and oil companies, which are easier to obtain and can be used to establish a good credit record.
Credit cards are used for identification purposes, as well as a way to postpone payment of purchases. It may be important to have one or two credit cards but it is not advisable to have or use too many.
NOTE: The interest charged on credit cards is quite high, usually about 12 percent to 18 percent per year.
TRANSFER OF FUNDS FROM YOUR COUNTRY
Most large banks are able to accept foreign currencies by wire transfer. This is the most convenient and fastest way to receive funds from your home country. Most National Banks are able to exchange foreign currencies. If your funds are received in the form of a bank draft, it will take about two weeks to clear the bank. You cannot use that money until the check is cleared by the bank on which it was issued. Cash deposits, money orders, cashier's checks, traveler's checks, and letters of credit can usually be drawn upon immediately.
HANDLING YOUR MONEY WHILE TRAVELING IN THE UNITED STATES
Buy a money belt to wear underneath your clothing.
Buy traveler's checks in US dollars. Buy them in small denominations $20 and $50. Sign them before leaving the bank. We recommend American Express or Citibank traveler's checks (sometimes they may be refused.)
Do not carry large amounts of cash at any time. When traveling, carry no more than a maximum of $100 to $150 in cash. Small bills ($5, $10, and $20) are best.
Always keep your money with you on your person while traveling. Do not keep your money in a suitcase, hotel room, or in the homes of friends or relatives.
If your traveler's checks or money are stolen, you should inform the local police immediately and file a police report.
Contact the nearest local office of your traveler's check company for instructions.
You do not need your passport to travel from state to state in the US however; you should carry some form of identification at all times.
COINS
United States coins come in two colors and six sizes. Smaller sized coins are not necessarily lower in value than larger coins. The following features will help you become familiar with American coins:
Penny or cent (1 cent) is the only copper-colored coin.
100 cents equal 1 dollar
Nickel (5 cents) is silver colored, larger than a penny, and has smooth sides.
20 nickels =1 dollar
Dime (10 cents) is silver colored and the smallest US coin.
10 dimes = 1 dollar
Quarter (25 cents) is silver colored and the largest of the common coins. The new quarters are slightly different than the old ones, but easily recognizable. Four quarters = 1 dollar
PAPER MONEY
All United States paper money is the same size and the same color. The US Treasury has recently changed the look of the bills so there are now two different versions, but the denominations are the same. Use the numbers on any corner of the bill or the portraits on the front to tell them apart. The following features will help you become familiar with American paper money and denominations:
$1 (one dollar) shows George Washington. SLANG: A dollar bill is often called a "buck".
$5 (five dollars) shows Thomas Jefferson.
$10 (ten dollars) shows Abraham Lincoln.
$20 (twenty dollars) shows Andrew Jackson.
$50 (fifty dollars) shows Ulysses S. Grant.
$100 (one hundred dollars) shows Benjamin Franklin.