For young adults today, it's
hard to imagine life
without gadgets and hightech
helpers. We want to
make sure you know about
some of the attractive
electronic banking services
beyond ATMs.
Internet banking (online
banking) enables you to
transfer money between
your accounts at the same
bank and view account
information, deposits as
well as loans, at any time.
Internet bill paying
allows you to pay monthly
and one time bills over the
Internet. Some banks offer
electronic bill payment
free of charge, others
charge a fee that is usually
less than what you would
spend on postage.
Debit cards look like
credit cards but they
automatically withdraw
the money you want from
your account. You can use
a debit card to get cash
from an ATM or to pay
for purchases.
Direct deposit enables
your paycheck and certain
other payments to be
transmitted automatically
to your bank account.
"Direct deposit is free and
it's fast - there's no
waiting for the check to
arrive at home and no
waiting in the teller lines",
said Kathryn Weatherby,
an Examination Specialist
for the FDIC.
Telephone banking
allows you to use your
touch tone phone to
confirm that a check or
deposit has cleared, get
your latest balance,
transfer money between
separate accounts at the
same bank, and obtain
details about services.
Automatic withdrawals
from your bank account
can be arranged free of
charge to pay recurring
bills (such as phone bills
or insurance premiums) or
to systematically put a
certain amount of money
into a savings account, a
U.S. Savings Bond, or an
investment.
"Your banking can be so
much more convenient
and easier to monitor and
control when you have
access to your accounts 24
hours a day, seven days a
week, from your home or
practically anywhere else",
added Weatherby.
However, she also stressed
the need to take security
precautions with your
electronic transactions and
your computer, such as
those discussed on Pages 5
and 6. To learn more
about electronic banking
and consumer protections,
see the Winter 2004/2005
FDIC Consumer News
online at www·fdic·gov/
consumers/consumer/
news/cnwin0405.
To Buy or Not to Buy...
That is a question many young adults face
when it comes to a home or a car
Renting vs. Buying a Home: Once you start earning
a good, steady income you'll most likely face this decision:
Should I buy my own home instead of paying rent to
someone else?
Most people want to own a home. Homeownership often
is referred to as "the American dream". Why is it so
special? Among the reasons: Real estate often is an
excellent investment, perhaps the number one source of
wealth building for families. Owning your own home also
can be a great source of pride and stability. But
homeownership may not be for everyone. It's a big
financial commitment - starting with the initial shock of
your purchase (including a "down payment" and fees paid
to a real estate agent, the lender and others) followed by
years of monthly mortgage payments, real estate taxes,
property insurance and maintenance costs (such as lawn
care and home improvements).
How can you learn more about renting vs. buying a
home, as well as your rights and your responsibilities as a
renter or a homeowner? A good place to start is
www·mymoney·gov, the new Web site for financial
information from the federal government. Or, go to the
Web site of the U.S. Department of Housing and Urban
Development (HUD) at www·hud·gov, which has answers
to common questions from renters and first time
homebuyers, a calculator you can use online to compare
buying vs. renting a home, and links to homebuyer
assistance programs across the country.
Buying vs. Leasing a Car: For many young people, their
first big financial commitment will involve getting their
own wheels.
One option is to buy, which may involve
borrowing money to pay for it. Before you visit a
dealership or bid for a car over the Internet, visit our
Web site for tips from FDIC Consumer News that can
help you save time and money, perhaps hundreds of
dollars, when it comes to shopping for an auto loan. See
Kicking the Tires on an Auto Loan: Don't Kick Yourself for
Paying Too Much online at www·fdic·gov/consumers/
consumer/news/cnsum04/autoloan·html.
Another option is to lease a car, which is similar to
renting it for a few years. The Federal Reserve Board has
published a guide to the differences between buying and
leasing a car, including cost considerations and consumer
rights. Read Keys to Vehicle Leasing online at
www·federalreserve·gov/pubs/leasing.