Money Management


Money Management

Most foreign students, like many American students, live on limited budgets. It is important to manage money wisely in order to insure that it lasts as long as possible. Because it takes time for newcomers to adjust to the value of the dollar and to estimate daily living expenses, these students should be cautious about spending money. Here are some hints about managing money:

Budget carefully

If you pay all bills at the beginning of the month, you will know how much remains for other expenses. Set aside the amount of money for rent, utilities, food, and other monthly expenses.

Keep accurate records

Keeping track of expenditures by category (for example, for books, recreation, and food) can pinpoint areas of heavy spending which might help you budget your money more wisely.

Transportation

An apartment close to campus may save hundreds of dollars annually on car expenses. Cars are very expensive to maintain and park. You can rent a car for special occasions. Bicycles and mopeds are the most common forms of transportation around Gainesville for most students.

Credit

Although credit is a convenience for purchasing large items, it is easy to overextend oneself financially with it. Some credit card companies charge 18-21% interest per year, which may total to hundreds of extra dollars annually over the worth of items purchased. You should evaluate whether you need expensive items before you purchase them on credit. Buy Used: Weekend garage and yard sales are advertised in newspapers daily, and are good places to purchase appliances for reasonable prices. You can bargain for a lower price at these sales.

Meals

Although dining out is pleasant and convenient, this can double your food bill. By making bagged lunches at home for school and eating at home you can save money.

Take Advantage of Sales and Coupons

By watching the newspaper for sales of items a student needs, he/she can save up to 50% on these items. The Paper Mint, a book of coupons distributed in Gainesville, and manufacturer's coupons can also save money on items. More information about the Paper Mint can be found in the "

Shopping

See section below, "Some Characteristics of Shopping in the United States."

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U.S. Currency

American currency is based on the decimal system, where 100 cents are equal to one dollar, $1.00 Currency is issued in the forms of bills and coins. Coins are metal and are either silver or copper-colored. They come in six different sizes: 1 cent, a penny, is made of copper; 5 cents, a nickel, is silver colored, and larger than a penny; 10 cents, a dime, is the smallest silver coin; 25 cent, a quarter, is silver-colored and larger than a nickel; 50 cents, a half-dollar or 50-cent piece, is silver and larger than a quarter, but not common; 100 cents, silver dollar, comes in two forms: the Susan B. Anthony silver dollar, which is the size of a quarter, and the older silver dollar, which is the largest coin (both are rarely seen in circulation). Bills are paper money. All U.S. paper money bills are the same size and the same green color. Denominations include $1 (commonly called a dollar), $2 (not commonly in circulation), $5, $10, $20, $50, $100, and larger amounts. Paper money for these larger amounts is not usually seen in public circulation.

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Banks' Banking Services

Because it is not wise or practical for people to carry large amounts of money with them or keep it in their homes, the money is usually deposited in a bank. In Gainesville, there are several banks that offer checking and savings account services, as well as other services such as wire transfers and dollar exchange, which are important for international students.

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Automatic Teller Machines (or ATM's)

Most banks in Gainesville have an automated teller service. This automatic teller is a computerized device through which bank customers can make deposits or withdrawals at any time of the day, any day of the week. To operate an automatic teller, you need a particular plastic card that the bank provides. Instructions for operating the automatic teller are given on the teller itself. Automatic tellers are located at the banks themselves and at other locations, especially at supermarkets. Some banks are part of the "HONOR" network of automated tellers, which means that you may use your card in different cities through Florida. Withdrawals and deposits made with the automatic teller will be subtracted automatically from the customer's savings or checking account. You may be charged a fee each time you use your ATM card. Because this may lead to confusion or mistakes in judging the balance in your account, you should retain your receipts after making a transaction, and enter all transactions, and any service charges, in your record.

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Savings Accounts

Money which is not used for routine living expenses is normally kept in a savings account. Savings accounts earn relatively low interest rates (between 5 and 6 per cent). You may usually withdraw any amount from a regular savings account (also called a "passbook account") whenever it is necessary.

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Savings Certificates

Banks also offer "savings certificates," "certificates of deposits" or "CD's," and "money market certificates," which require specified minimum deposits for specified minimum time periods. These usually earn higher rates of interest than regular savings accounts. A savings certificate or money market certificate is a prudent investment if the customer is certain that they will not need the money until the designated time period (which may be 90 days, six months, one year, or longer) has elapsed. You may be charged a penalty fee for withdrawing part or all of your investment before its maturity date.

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Checking Accounts

Banks offer different types of checking accounts. Some banks charge a fee for each check written, while others will not charge per check if the customer maintains a minimum balance of $500. Select a bank whose checking account policies and services best meet your needs. You must pay to have personalized checks made, which have your name, address, and phone number on them. The bank sends a monthly statement of checks that you have written, so that you have a record of these checks. It is important to be sure that the record of the amount remaining in the account coincides with the bank's record. The statement will also reflect amounts subtracted from the account by the bank for service charges or for the printing of personalized checks. If you use an automatic teller card to withdraw or deposit cash, these transactions will also appear on the monthly statement. Be sure to enter the transactions when they are made so that you will have an accurate record of your account balance. You are penalized for checks that are written for an amount that is greater than the amount of money you have in your account. Checks such as these are called "returned checks," "bounced checks, "or "overdrafts," and your bank and the place you wrote the check will charge you a penalty fee, plus you will have to pay the returned check amount in cash. Some stores may revoke your check-cashing privileges for writing returned checks. Writing a check for which you know you do not have funds is called a "bad check", and is illegal. You can be arrested for writing a bad check.

How to Write a Check

Here are the steps to follow when writing a check. Refer to the following diagram for illustrations of these instructions:

  • Write the date you are "issuing" the check.
  • Write the name of the person or business to which you are making the payments (the "payee").
  • Write the amount of the payment in numerals (150.50), at the far right on the line with the name of the "payee." Put the first numeral directly after the printed dollar sign, not leaving any space for another person to alter the amount of the check by writing in an additional numeral.
  • Spell out the number of dollars included in the payment, and write the number of cents in the form of a fraction, on the next line. (For example, "One Hundred-Fifty and 50/100) Begin writing on the far left of the line, and fill the entire line with your writing, or draw a line to fill in any blank space.
  • Sign your name as it is printed on the check.
  • Note the purpose of the payment in the check register. (If you make a deposit to your account, be sure to also indicate this in your check register.)

Reminders When Writing a Check:

  • Write the check at the cash register only when you are ready to pay for your purchase.
  • Always record in the check register: the date, the check number, the amount, and the person or business to whom you are writing the check. Compare this record with the monthly statement the bank sends you.
  • When depositing a check or cash in the bank, use a deposit slip. Deposit slips are located at the back of your checkbook, or the bank can give you a blank deposit slip. If you want to mail a check for deposit, sign your name on the back of the check exactly as it appears on the front of the check. Add the words "For Deposit Only" on the back of the check, as well as your account number, so that no one else can cash the check if they find it.
  • If you have a bank card to use at an automatic teller machine, do not print your code number or your personal identification or access code on your card or in your checkbook. If your wallet or purse is stolen or lost, someone else can easily use this information to take money out of your account.

How to Cash a Check Written to You

When someone writes you a check, you must sign your name on the back of the check exactly as it is written to you, only when you are ready to cash or deposit the check! This is called "endorsing" the check. You can sign your bank signature below, if it is different from the first signature. Many banks ask you to write your bank account number on the back of the check, and may ask you to show proof of identification. Caution: The bank will normally "hold" the check until it "clears." This means that the bank will not allow you to use the money until they are certain that the funds exist. This "hold" can take between one week and one month, which can cause problems for students who bring all their money in the form of one check. Be certain that you have enough cash with you to pay for routine expenses while a large check is clearing. Writing a check is written proof of a purchase, and can be the equivalent of a receipt. (If you may have to return a purchase, however, you should save the receipt, as many stores will not accept merchandise for exchange or refund without the receipt.)

Cashing A Sponsor's Check Written to the University

Sometimes students receive sponsor checks for tuition which are written to the University of Florida. You should bring these checks to Student Financial services

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Cash

Cash is the easiest way to pay for purchases, but because it can be stolen so easily, most people carry only small amounts of cash with them. People who need cash withdraw it from the bank. Some supermarkets will also cash checks if you hold a check-cashing card for that store. At the University, the J. Wayne Reitz Union and the Hub Campus Shop and Bookstore cash checks for students who have a picture identification and fee card. It is important to always obtain a receipt for large purchases when you pay in cash. Unlike paying with checks or credit cards, if you pay with cash, you receive no receipt unless you ask for it.

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Traveler's Checks

If someone is traveling outside of Gainesville, their personal checks will often not be honored by businesses in other cities. Traveler's checks are a safe alternative to carrying cash. These may be purchased at banks for a small charge, and can be used at restaurants, stores, and hotels around the world. Traveler's checks can also be replaced if they are lost. It is important to keep the numbers of your checks in a safe place so that you may refer to them in case the checks are lost or stolen. The most popular Traveler's check companies are American Express and Citicorp. The checks require two signatures made at different times in order for them to be valid. The first signature is made when you purchase the check; the second signature is made when you wish to use the check. The second signature, made at the time of purchase, demonstrates that the check belongs to the person who originally signed the check.

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Wire Transfers

Wire transfers are immediate transfers of funds from one bank to another. Because banks communicate by telephone or telegram, the funds can often be received the day after a wire transfer is requested. The person who sends a wire transfer must know the name, address, and number of the bank to which he/she is sending the money. He/she must indicate the name of the recipient of the money. When the recipient claims the funds, he/she must show picture identifications, such as a driver's license or a passport, in order to receive the money. The recipient may pay $20 or more for the cost of the service. Wire transfers must be made in U.S. currency. Banks may hold wire transfer funds from two days to a week. ISS has a list of the banks that will do wire transfers, their numbers and addresses, and the length of time they will hold funds. Some banks will handle wire transfers for persons who are not customers of the bank.

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