Banking · Module 5 of 5
Moving money in and out
Getting paid, using ATMs, overdrafts, and the real difference between debit and credit cards.
Key terms in Moving money in and out
- Direct deposit
Direct deposit is money sent electronically straight into a bank account, credit union account or prepaid card. Employers commonly use it to pay wages, and government agencies use it for benefits and refunds. It avoids paper checks and the fees some places charge to cash them.
Source: Consumer Financial Protection Bureau, Financial Terms Glossary
- Overdraft
An overdraft happens when an account lacks enough money to cover a transaction but the bank pays it anyway. The account balance then drops below zero. Institutions may charge a fee for the service, and the rules for those charges differ by account type and by whether the customer has opted in.
Source: Consumer Financial Protection Bureau, Financial Terms Glossary
- Debit card
A debit card is a payment card issued by a bank and linked to a checking or savings account. Purchases draw on money already in the account, so no borrowing is involved and no interest is charged. It carries a card network logo that can make it look like a credit card.
Source: Federal Deposit Insurance Corporation, Debit, Credit and Prepaid Cards: There Are Differences
- Prepaid card
A prepaid card is a card on which money is loaded in advance, so spending is limited to the amount already added. Unlike a debit card, it is not linked to a bank or credit union account. It also differs from a credit card because it involves no borrowing and no payment due date.
Every term on Lever is in the money glossary.
About this module
Moving money in and out is part of Banking, one of 15 subjects in Lever. It’s a short run of 7 lessons, about 18 minutes in all, so you can finish it in one sitting.
Every lesson takes one idea at a time. You read it with the math worked out step by step, answer a question that puts it to use, then see why the right answer is right and why the others aren’t.
It’s for anyone who was never taught this, and you don’t need to know anything first. Every lesson is free. Lever works out what you already know, so you can start here or let your path bring you to it.
More in Banking
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1
Lending to people you know
Lending to friends and family, cosigning a loan, and what it can really cost you.
6 lessons -
2
What a bank actually does
What a bank does with your money, how it makes a living, and how to choose between a bank, a credit union and an online bank.
5 lessons -
3
Where the money sits
Checking, savings, fixed-term deposits and more: what each account pays, how easy it is to reach, and when switching is worth it.
8 lessons -
4
What borrowing costs
What a loan is made of, what the yearly rate means, and why paying only the minimum costs so much.
5 lessons
Try this module
It’s part of Banking. Lever will bring it to you when you’re ready, or you can go straight there.