NGPF Activity Bank

Banking
Spanish version

Name Dustin Delk, _____________________

COMPARE: Types of Savings Accounts
There are multiple types of savings accounts that can help you meet your savings goals. You’ll explore and compare four different types of savings accounts in this
activity by first researching the basics of the accounts, then comparing which of those accounts a specific bank or credit union offers, and finally applying what
you have learned about those accounts to various saving goal scenarios!

Part I: Research Savings Accounts

1. TEAMWORK: With a partner or alone, conduct online research about the types of savings accounts: (1) Traditional Savings Account, (2) Online Savings
Account, (3) Certificate of Deposit, or (4) Money Market Account. With your teammate, conduct online research on the savings account type. Complete
each field below.

Type of Saving Account: _ Traditional Savings Account ______________________________

Describe how it works / Draw a picture: Typical Interest Rate: Typical Minimum Balance:
.43 APY
A savings allows you to accumulate funds you $300-$500
have saved for future

Can you add to balance regularly? Is it FDIC insured?

Yes yes

Can you write checks / pay bills directly Is your money “stuck” for a set time?
from it? No but your bank may set limits on how

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 Yes with few limits much you can withdraw or set a fee for
withdraws

Add to Write Money

Typically Is it
Type of Typical balance checks / stuck for
Description Minimum FDIC
Account Interest Rate regularly pay bills a set
Balance insured?
? directly? time?

Traditional
Savings No might
Account
A savings allows you to accumulate funds you have Yes with be fees or
.43 APY $300-$500 yes yes
saved for future few limits limit
though

Online
Savings A savings account that only exists online and there is no
Account
real life brick and mortar bank for it
5% $100 OR LESS yes yes yes No never

Certificate of You
Deposit cannot
a type of savings account offered by banks and credit withdraw
unions. You generally agree to keep your money in the .20% No not your
CD without taking a withdrawal for a specified length of
$500-$2500 no yes without money for
time. Withdrawing money early means paying a penalty
penalty a set
fee to the bank
period of
time so
NO

Money .1%-3.45% $5000,$10000 no yes yes

Market Yes for a
Account

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 money market accounts are insured by the FDIC or
NCUA, up to $250,000 held by the same owner or
owners. Money market accounts tend to pay you higher period of
interest rates than other types of savings accounts. time

Part II: Research A Bank or Credit Union

Now that you know the basics of how these four types of savings accounts work, let’s take a closer look at how these accounts compare against each other at your
favorite bank or credit union. Select one bank or credit union (it can be one that you or your parents / guardians currently use, or one that you are interested in
learning more about). Then, research the bank or credit union’s options for savings accounts. NOTE: If the bank offers multiple products in the same category (ex:
two tiers of MMA or CDs at 10 different time intervals) just record answers for ONE of the options.

3. What bank or credit union do you want to explore? Include the name, website link and indicate if this bank / credit union is an ONLINE or a
TRADITIONAL brick & mortar institution. Navy Federal Credit Union, https://www.navyfederal.org/, it is a brick and mortar instutution

4. Research information for a savings account, a CD, and an MMA for this bank / credit union. Record your findings in the table below.

Savings Account CD MMA

Account name CD MMA

(ex: Basic Savings, 1 Savings account
Year CD, 5 Year CD)

Interest rate .25% 4.50% for 18 months .23APY

Minimum Only $5 $1000 $5

deposit or
balance

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 Fee There are penalties for No fees
A $3-per-quarter fee will be withdraws before the time
charged if your savings period on the account
account has no activity for
12 months, you have no
other Navy Federal account
relationships and your
combined balance is less
than $50.

Time period for Within 90 days The day before the official
your deposit Same day or day after pay date

Part III: Apply Your Knowledge!

Congratulations - you now have a deeper understanding of how various types of savings accounts can be used for different savings goals! Now that you know
more about the details on these different accounts, apply your learning by helping out the following characters by reading each scenario below and selecting which
type of savings account, from the 3 you’ve chosen above, fits best.

5. Robert wants to get serious about saving for a new car. Which account would you recommend? Why? I say the CD account because with that withdraw
penalty, he will refrain from taking money out of the savings for anything else than the car that he was saving for.

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6. Cindy has been working for 8 years, and she’s built up a huge emergency fund -- $45,000, which would be 6 months of her salary. She’s hoping to earn a
bit more interest than she currently is with that $45,000 just sitting in her traditional bank’s savings account. Which account would you recommend? Why?
The MMA account because it has the lowest interest fee.

7. Janelle likes to keep all her savings goals separate, so she has an account for each one, including an account to save for her college textbooks every
semester. She buys books about every 6 months, with roughly $550 due each time. She likes to save the money up in installments, with auto-deposits from
each of her twice monthly paychecks. She’s wondering if her online savings account, earning 0.75%, is still her best option for monthly deposits toward
her textbooks. Which account would you recommend? Why?
8. The regular savings account because it only has a .25% interest rate and a $3 per quarter fee , and also no other fees

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