| A | B |
|---|
| Compound interest | Interest is earned on interest. |
| APR | The actual Rate used to calculate interest in one year |
| APY | The actual Rate of Return on your investment. It takes into account compounding. |
| Savings Account | An account from which you can easily withdraw money without paying a penalty; however usually pays very low interest. |
| Money Market Savings Account | An account that usually pays higher interest; however the minimum deposit required is usually higher. |
| Certificate of Deposit | usually pays high interest; however, in exchange for the high interest you lose some liquidity. |
| Liquidity | the ease of transferring your asset to cash. |
| Individual Retirement Account | a savings plan that offers a way to save for retirement and enjoy tax benefits. |
| EFT System | eliminates the costly and time consuming process of handling and processing checks, deposit slips, and other pieces of paper. |
| Direct debit | Money is withdrawn (subtracted) from your account electronically |
| Direct deposit | Money is deposited (added) into your account electronically |
| Automated Teller Machine | a computer terminal where bank clients can perform financial transactions. |
| Point-of-Sale Transfers | Allows customers to pay a retailer (seller) by using a debit card, instead of writing a check. |
| POS Terminal | The place where Point of Sale transactions are processed |
| Money Order | bought by people without a checking account to make a small payment through the mail. |
| Traveler’s Checks | purchased when it is not wise to carry a large amount of cash while traveling. |
| Safe Deposit Boxes | rented containers that are stored inside the bank’s vault. |
