For better or worse (whether it’s good or bad), technology has made it almost completely unnecessary for us to physically go to a bank these days. Most banking can be done online or at an ATM. In fact, I think the last time I physically entered a bank and spoke to a teller (the person who works at the bank) was four years ago when I set up my German account. However, banking is still an essential (key, very important) part of day-to-day life, so it's important to know some banking English vocabulary.
Whether you handle all your accounts online, still balance a checkbook, or like to go inside a bank to speak with a real person, here are some essential banking English phrases.
When you go to an ATM, the machine will usually ask you what you would like to do and present (give, offer) you with a few options. You can do things like check how much money you have in your account (your personal amount of money), deposit (put in) money, or withdraw (take out) money by making a withdrawal.
Don't be scared off (intimidated, afraid) by the word withdrawal...it's even tricky for me to say! Withdraw simply means to take out money out of an account. Who doesn't like holding some cold, hard, cash?
Do you make enough money to put some away at the end of the month? Then you might want to save some of it. Saving money means putting some money aside (on the side) for when you may need it at a future point in time. We have a great idiom for this in English: putting money aside for a rainy day.
To save money, people usually have a separate savings account to keep that money separate from their general spending money (money you use regularly to pay for things). Watching your savings account grow each month is a great feeling, so if you think it's time to open a savings account, you definitely should!
A deposit is pretty much (basically, in essence, in principle) the opposite of a withdrawal. A deposit is when you or an employer puts money into your bank account, instead of taking it out.
I like to deposit the change I've collected into my savings account every few months. It's a great, little way to save some extra money!
Interest is one of my favorite parts of a savings account, and least favorite parts of a credit card. When you open a bank account, they will generally have a small amount of interest attached, meaning that the bank will pay you a little bit of money, a fixed percent, each month to incentivize (reward, pay) you to keep your account open. It's never much money, but it's always nice to see my money growing month by month.
Interest on something like a loan (money you borrow from the bank) or a credit card is a fixed percentage charged to you (that you have to pay the bank) each month for borrowing money.
This is part of how banks make money: by charging you a fixed percentage of interest for borrowing money they are borrowing from other customers. So, a customer puts money in the bank and the bank gives the customer a percentage of interest for allowing the bank to use their money. In turn, the bank uses that money to give to other people in the form of a loan and charges the borrower a higher interest rate for using the money. This way the bank can pay interest to their customers with the interest they charge the borrowers. Make sense?
Interest on a loan can make things like student loans difficult to pay off, as you end up paying back a lot of interest.
To deduct is quite similar to withdraw, but slightly different. When something is deducted from your account, it is subtracted from it. A deduction is usually something like an automatic payment set up to be removed from your account each month, a payment at a restaurant, etc. These are listed clearly on your bank statement/ bank summary.
Does your employer (the place you work) pay your salary (the money you earn) directly into your bank account each month? Then you have a direct deposit set up.
Direct deposit is exactly what it sounds like: it's when a certain amount is deposited into your bank account directly, without the need for a middleman to handle the transaction. The day the direct deposit clears (transfers, goes through) is the best day of the month!
Have you ever heard of anyone paying remunerations? Remuneration is a scary sounding banking English word, but it's really just a fancy word for a payment (normally money) in exchange for work or a service. So, when that direct deposit clears, you're getting your remuneration from your employer.
This is perhaps one of the most important banking English phrases when it comes to your personal banking, as you won't get very far without a bank account. When you are just starting out as a young person, move to a new country or state, or feel it's finally time to switch banks, you'll have to go into a bank and tell them that you would like to set up or open an account.
Did you like this blog? Share it with others! Let us know what YOU think!
Erin Duffin lives in Hamburg, is an English teacher, blogger, yoga instructor, and loves when she sees her remuneration directly deposited into her bank account! Whoo hoo! Pay Day!