What is Banking?

In its simplest form, the concept of banking revolves around an institution accepting deposits (cash, your paycheck, etc) from a customer. These deposits could go into several different types of accounts - some essentially are available for transactions (i.e a checking account) that generally pay limited or no interest, or savings types of accounts that pay “interest” to the customer to keep those funds in the account (either for a fixed duration, or available to the customer for transactions. Banks in turn lend funds to customers in the form of a loan.

What is Money?

Money. It conjures up so many feelings.

  • we don’t have enough
  • it's the root of all evils
  • money = freedom
  • money = happiness
  • it's stressful

What words come to mind for you when you hear the word “money?” For so many of us, it’s a scary topic . Some of that is because we don’t have a fully operative definition of the word.

so what is it, really?

checking account

It can be hard work to live life without a basic bank account. For most of us, a “checking account” – also known as a “demand deposit account” – is a necessity. We deposit our income into these accounts, and then use those funds to pay our bills – via online billpay, or checks, or even using a debit card. Banks, credit unions, and certain investment brokerages offer these accounts. Some accounts pay interest, some do not.


When choosing a bank account, find a no fee or low fee account. If you can maintain a high balance on deposit, an interest-bearing checking account may make sense for you. But in general, find an account where you can easily meet the requirements to avoid paying monthly fees.


When you pay a monthly fee for a checking account, you are basically paying a company for that account. And in the financial services marketplace of today, it is easy to avoid most, if not all, fees with a little planning. Your goal should always be to keep as much of your money as possible – and this is under your control.


Once you have your account open, it’s important to monitor the activities in your account to ensure that you know what is happening to your money (both what you are spending, and to ensure that no one hacks your $$$). This information will feed into your budget tracking program.

savings account

Here at Trevi we recommend that you set up at least two savings accounts using a higher interest rate option from an online bank – or check out savings or money market products from your consumer-friendly local community bank or credit union.  


Your first savings account should be your rainy-day savings account. This isn’t used for your goals, but rather to cover those unexpected emergency expenses, like car repairs or a new appliance. Set a goal to save at least three to six months of salary in this account.


Your second savings account should be used to start saving for some of your aspirational goals. Make sure to fund your rainy-day account first though.


For some people, additional savings accounts may make a lot of sense. If you want to save for a number of different goals, you may find it helpful to set up accounts for those goals. Or, at times you may find it helpful to set up accounts to help smooth out your budgeting process over the course of the year. For example, you may budget $1,000 in car maintenance expenses over the year. You could set up an online savings account and deposit $83.33 in that account each month. The balance will build up month in and month out, and then when you need the money, it will be available.


The accessibility of online savings accounts makes it easy to set up a savings account structure that works best for your goals and aspirations. Take advantage of higher rate savings accounts available.