Checking/Savings Glossary of Terms

Annual Percentage Yield (APY): A percentage rate that reflects the total amount of interest paid on a deposit account (e.g., checking, savings, CD or IRA). It is based on the interest rate earned on your account and the frequency of compounding for a 365-day period.

Automated Clearing House (ACH): A nationwide electronic funds transfer system that provides for inter-bank clearing of electronic transactions (i.e., money is moved electronically between banks). Some examples of ACH transactions are Direct Deposit of payroll, Social Security and tax refunds, and direct payment of mortgages and utility bills.

Available Balance: This is the amount of money you have in your account that is available for withdrawal. It reflects the latest balance based on transactions posted to your account, including deposited funds, paid checks, withdrawals, and purchases made with your ATM Card or Debit Card. Please note that some transaction activity (such as outstanding checks and some Debit Card purchases) may take several days to post to your account and, therefore, may not be reflected in the available balance. Some deposits made in a store or ATM may not be immediately available for withdrawal or to cover other transactions.

Average Daily Balance: The daily ending balance divided by the number of days in the statement cycle.

Bill Pay: An online banking service that offers the convenience and control of managing and paying bills online. With Cornerstone Online Bill Pay, you can pay any company or individual in the U.S., schedule one-time, recurring payments and choose to receive electronic bills from selected billers.

Bounced Check: See Non-Sufficient Funds (NSF)

Cancelled Check: A check that the bank has paid against money or funds in your account.

Cashier's Check: A check drawn on and issued by the bank. A cashier's check can be used instead of a personal check to guarantee that funds are available for payment.

Certificate of Deposit: (Time Account, Time Deposit, or CD) An FDIC-insured bank deposit account where you agree to keep the money on deposit for a specified period of time, usually anywhere from three months to several years. In exchange, the interest rate paid is usually higher than the rate paid on savings accounts. Accounts with higher balances and longer terms may earn higher rates. Funds withdrawn prior to "maturity" are subject to an early withdrawal fee. You can elect to let accrued interest compound in the account or have it paid to you monthly, quarterly or annually.

Certified Check: A personal check that the bank guarantees or certifies to be good.

Check: A written order you have authorized instructing the bank to pay a specific person or entity a specified amount of money from your account.

Checking Account: A bank account that allows you to deposit and withdraw money, make point-of-sale purchases and write checks.

Compound Interest: When interest is paid not only on your deposits, but also on the interest that has been paid on your account.

Credit: A deposit of cash or checks made to your account that increases your available balance.

Debit: Any item that reduces the balance in your bank account. A check, ATM withdrawal, and Debit Card purchase are all examples of debits.

Debit Card: A card issued by the Bank for making purchases; either by Personal Identification Number (PIN) or by signing for your purchases everywhere debit cards are accepted. You can also use it to access cash at ATMs. The amount of your purchases or cash withdrawals is deducted from your primary linked checking account.

Deposit: To put money into your account.

Direct Deposit: Direct Deposit is a free service that automatically deposits your recurring income received into any Cornerstone checking or savings account that you choose. Income received from your employer, Social Security, pension and retirement plans, the Armed Forces, VA Benefits, and annuity or dividend payments may all qualify for Direct Deposit.

Federal Deposit Insurance Corporation (FDIC): An independent agency of the United States government that protects customers from the loss of their deposits if an FDIC insured financial institution fails. The basic insurance amount is $250,000 per depositor per insured financial institution. Customers can increase the amount of money insured at any one financial institution by owning deposit accounts in different ownership categories (e.g., Individual Accounts, Retirement Accounts, Joint Accounts, Revocable Trust Accounts).

Interest: A fixed amount paid on deposits or a fixed charge for borrowing money, usually a percentage of the amount deposited or borrowed.

Interest-Earning: Bank deposit accounts that earn interest. An interest-earning account may earn interest at a variable or a fixed interest rate.

Linked: Linked refers to accounts or services that are tied to or connected to your checking account.

Joint Account: A bank account owned by two or more people who are equally responsible for the account.

Minimum Balance: A specific amount of money that the bank requires to open or maintain a particular account, or avoid a service fee.

Money Order: A document issued by a bank ordering payment for a specific sum of money to an individual or business.

Non-sufficient Funds (NSF): A term used to indicate when an item such as a check, or other transaction presented for payment is returned unpaid because the available balance in your deposit account is less than the amount of the item. Also called "Returned item" or "bounced check." A Returned Item fee will apply.

Online Banking: A service that allows you to handle most banking activities from your computer via the Internet. Banking activities such as monitoring account activity, transferring funds, paying bills, etc., can be done quickly, easily and safely.

Overdraft: A term used to indicate when an item such as a check, Debit Card purchase or other transaction presented for payment is paid even though the available balance in your deposit account is less than the amount of the item, thereby creating an overdraft (or negative balance) in your account. An Overdraft Fee will apply.

Overdraft Protection: A service offered by the bank in which savings or credit accounts are linked to your checking account for the purpose of transferring or advancing sufficient funds to cover items when the available balance in your checking account is less than the amount necessary to cover the items. An Overdraft Protection Transfer or Advance Fee applies.

Personal Identification Number (PIN): A secret combination of letters or numbers you use to gain access to your account through an electronic device such as an ATM

Reconciliation: Comparing your bank statement to your check register each month.

Returned Item: See Non-Sufficient Funds (NSF).

Point-Of-Sale (POS): A merchant transaction (purchase or return) made through a store, telephone, or internet using an ATM Card or Debit Card for PIN or signature-based purchases.

Routing Number: The nine-digit number on the bottom left hand corner of your checks, to the left of your account number. The routing number identifies the bank that issued the check. Every bank in the United States has at least one routing number.

Roth IRA: A type of IRA that allows individuals, subject to certain income limits, to set aside money each year to grow tax-deferred. Contributions may be withdrawn tax-free at any time. Earnings may be withdrawn tax-free if certain conditions are met, otherwise taxes and penalties may apply.

Savings Account: An FDIC-insured bank deposit account that earns interest. Unlimited withdrawals are permitted in person and at the ATM. Other withdrawals are subject to limits.

Simple Interest: Interest that is calculated only on the principal amount, that is, the amount of the money that was originally deposited. (By contrast, compound interest is when a financial institution pays you interest, not only on your initial principal amount, but also on the interest your deposit has earned over time).

Stop Payment Order: When you ask the bank to not pay a particular check/transaction that you have written on your account.  A stop payment fee will apply.

Statement Cycle: A period of time for which activity on your account is reported on your statement. There is a start and end date for each statement cycle.

Time Account, Time Deposit or CD: An FDIC-insured bank deposit account where you agree to keep the money on deposit for a specified period of time, usually anywhere from three months to several years. In exchange, the interest rate paid is usually higher than the rate paid on savings accounts. Accounts with higher balances and longer terms may earn higher rates. Funds withdrawn prior to "maturity" are subject to an early withdrawal fee. You can elect to let accrued interest compound in the account or have it paid to you monthly, quarterly, or annually.

Variable Rate: An interest rate that can change on a periodic basis or when certain conditions are met.

Wire Transfer: Cornerstone’s wire transfer system enables you to move money between financial institutions anywhere in the U.S. and throughout the world. Because wire transfers are immediate, they are also used for transactions requiring finality of payment.

Withdrawal: To take money out of your account. You can do this many different ways including:

  • Writing a check
  • Debit Card purchase - use your Debit Card to make a purchase anywhere debit cards are accepted including, gas stations, grocery stores and online
  • ATM withdrawals - get cash at ATMs worldwide
  • At any Cornerstone banking location