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Below is a list of money matters that you may encounter on a daily basis during your adventure in the United States.
United States currency is based on a decimal system, with one dollar ($1 or $1.00) equal to one hundred cents. Coin currency is used for amounts less than one dollar; the most common coins and their equivalencies follow:
- penny equals one cent or 0.01 dollars
- nickel equals five cents or 0.05 dollars
- dime equals ten cents or 0.10 dollars
- quarter equals twenty-five cents or 0.25 dollars
It may take a few days to get used to the new currency. You will learn, for example, that $1 is a reasonable price for a can of cola out of a vending machine; two dollars for the same item is expensive. Five dollars for a pizza is inexpensive, while twelve dollars is expensive.
Paper currency, all printed in green and white, is most often circulated in the amounts of $1, $5, $10, $20, $50 or $100. The slang term for a dollar bill is a “buck,” so $50 may be referred to as “fifty bucks.”
Most banks and some major airports and hotels will exchange foreign paper currency for a service fee; very few, however, exchange foreign coinage. Pay attention to drastic fluctuations in the exchange rates between your home country’s currency and U.S. currency. If your home currency is decreasing in value, you may wish to conduct all transactions (like student loans) in U.S. currency.
Within the first few days of your arrival, you may want to open a checking account with a bank on or near campus. You may directly deposit traveler’s checks for free in most cases, or arrange for a wire transfer from your home bank for a fee of about $35. Typically, you may make an unlimited number of additional deposits or withdrawals thereafter. Be sure to always have sufficient funds in your account to cover all outstanding checks; if you “overdraw,” the bank may impose expensive fees. Also be aware that there is usually a waiting period of a few days before you may withdraw the money you deposit, as a way for the bank to protect itself from fraud.
You will most likely need some form of identification to open a checking account. The bank representative may ask you for your Social Security Number. If you do not have one, fill out an IRS Form W-8, which the bank can supply.
Most banks offer a number of different types of checking accounts. One might bear interest if you maintain a minimum balance; another might provide a limited number of free checks. Learn about all options before deciding which type of account is best for you.
Many college students appreciate the convenience of a MAC (Money Access Card) or ATM (Automatic Teller Machine) card. The card allows account holders to make deposits, withdrawals and other transactions at any time—24 hours a day—through machines located throughout campus and shopping districts. If you have an ATM card from a bank in your home country, ask whether the U.S. bank will honor it; some Personal Identification Numbers (PINs) cross national borders, while others do not. As a safety precaution, most ATMs limit the daily withdrawal amount to $300. If you happen to lose your ATM or MAC card, report it immediately to your local bank office.
Writing a check is simple. The dollar amount is written twice: once using numerals ($67.32 for example) and once using words (sixty-seven dollars and 32/100). Draw one horizontal line through any unused space after the words, to prevent someone from adding extra digits.
Once a month, the bank typically mails the account holder a statement of all transactions. It is important to make sure that their records match your records to ensure that no errors were made by them or by you. If you have a question about your account, contact your local bank office.
Generally, retail stores accept checks only if they are drawn on an in-state bank. Be prepared to show some form of photo identification, such as a driver’s license, student I.D., or passport (though you may not want to carry such an important document with you all the time).
Credit and Debit Cards
One payment option accepted nationwide is the credit card. As a matter of fact, you may find it difficult to make certain purchases without a credit card. You need one to place an order by phone, to rent a car, or buy airline tickets in most instances. A credit card is also a good idea if you want to maintain good financial records, as your monthly statement will serve as a reminder of how you are spending money.
A credit card may turn into a very expensive payment option if you are not able to pay the balance on the account within the specified grace period—typically between 20 and 30 days. Be careful to read all of the details of the credit card offer before committing to it; some companies offer a special low introductory interest rate (perhaps 2.9%), but then increase it dramatically (to about 18.9%) after that introductory period. Also know the structure of the credit card company’s annual fees, such as how much and when they charge it to your card. As always, learn all you can so that you can make an informed decision.
Some companies are reluctant to issue credit cards to international students, as they do not have an established credit history in the United States. If you already have a major credit card from your home country (like Eurocard, Access, Chargex, Barclaycard, Carte Bleue, American Express, Visa or MasterCard), bring it with you; after the U.S. bank reviews your credit limit on the foreign card, they may be more likely to offer you a credit card. Banks with which you have accounts are also more likely to accept your request for a credit card.
Debit Cards (also referred to as “bank cards”) are another option. When you open an account, you will most likely get a bank card which you can use to withdraw money from an ATM. You can also use it like a credit card to make purchases. Unlike credit cards, the money is instantly taken from your account, so if the money is not there it will be rejected.
Common money terms
abbreviation of Automated Teller Machine: a machine, usually in a wall outside a bank, from which you can take money out of your bank account using a special card.
the amount of money in a bank account.
I’d like to check my bank balance, please.
sums of money paid by a customer for a bank’s services.
a printed record of the money put into and removed from a bank account
when a check cannot be paid or accepted by a bank because of a lack of money in the account:
I had to pay a penalty fee when my check bounced.
(noun) money in the form of notes and coins, rather than checks or credit cards:
Do you have any cash on you?
cash a check/cheque
(verb) to exchange a check for cash:
Would you cash a check for me?
checkbook (US) / chequebook (UK)
a book of checks / cheques with your name printed on them which is given to you by your bank to make payments with.
check (US) / cheque (UK)
a printed form, used instead of money, to make payments from your bank account:
I wrote him a check for $100.
- money in your bank account.
I was relieved to see from my statement that my account was in credit
- a method of paying for goods or services at a later time, usually paying interest as well as the original money.
They decided to buy the car on credit.
a small plastic card which can be used as a method of payment, the money being taken from you at a later time.
checking account (US) / current account (UK)
a bank account that you can take money from at any time and which usually earns little or no interest.
(a record of) money taken out of a bank account.
The account was in debit at the end of the month (= more money had been spent than was in the account at that time).
money, which is owed to someone else, or the state of owing something:
He managed to pay off his debts in two years.
The firm ran up huge debts.
deposit (US) / pay in (UK)
to put money into a bank account.
If you go to the bank, will you deposit these checks for me?
an arrangement for making payments, usually to an organization, in which your bank moves money from your account into the organization’s account at regular times:
I pay my electricity bill by direct debit.
when you spend or use money.
Buying a bigger car has proved to be well worth the expense.
We’ve just had a new garage built at great expense.
an agreement in which you pay a company money and they pay your costs if you have an accident, injury, etc.:
- money which is charged by a bank or other financial organization for borrowing money.
I got a loan with an interest rate of 10%.
- money that you earn from keeping your money in an account in a bank or other financial organization.
You should put the money in a savings account where it will earn interest.
a sum of money which is borrowed, often from a bank, and has to be paid back, usually together with an additional amount of money that you have to pay as a charge for borrowing.
She’s trying to get a $100 000 loan to start her own business.
Non Sufficient Fund
The act of overdrawing a bank account.
a person who money is paid to or should be paid to.
savings account (US) / deposit account (UK)
a bank account in which you usually leave money for a long time and which pays you interest.
standing account (UK)
an instruction to a bank to pay a particular amount of money at regular times from a person’s bank account to another bank account (compare direct debit)
(an amount of) money paid to the government, which is based on your income or of the cost of goods or services you have bought:
They’re putting up the tax on cigarettes.
a piece of paper that you buy from a bank or a travel company and that you can use as money or exchange for the local money of the country you visit
to take money out of a bank account.