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Checking and Savings Glossary

A - C | D - L | M - R | S - Z

A – C

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 most current record we have about the funds that are available for withdrawal from your account. It includes all deposits and withdrawals that have been posted to your account and it is adjusted throughout the day with your account’s pending transactions that are authorized or known to the bank. If a hold was placed on a recently posted deposit, generally $200 of the deposit will be available for your use, with the remaining funds available when the hold is removed.

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 Wells Fargo ® 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 Returned Item.

Canceled 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

See Time Account. Time Deposit or CD.

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.

Chip Card

A debit or ATM card that has a chip on the front as well as the traditional magnetic stripe on the back. The  chip provides added security when used at a chip-enabled terminal or ATM and greater global acceptance. Many countries worldwide have adopted chip technology, and it will become the standard for card payments in the U.S. If a merchant or ATM has not yet adopted chip technology, your transaction will be processed using the magnetic stripe as it is today.

Conduit IRA

A separate IRA established with a rollover from an eligible retirement plan.

Coverdell Education Savings Account

Designed to help parents and others fund a child's education. Contributions and earnings may be withdrawn tax-free when used to pay qualified education expenses.

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 made to your account that increases your available balance, such as cash or checks.

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D - L

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 and payments at participating retailers and service providers – including online or by phone. You can also use it to access cash at ATMs. Purchases and payments are deducted from the primary checking account linked to the card. The debit card comes with a chip on the front as well as a traditional magnetic stripe on the back.

Deposit
To put money into your account.

Direct Deposit
Direct Deposit is a free service that automatically deposits your recurring income received into any Wells Fargo 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.

Excess Activity
Regulation D and Wells Fargo limit certain types of withdrawals and transfers from a savings account to a combined total of six (6) per monthly fee period. If the limit is exceeded, a fee will be assessed. Please refer to the Consumer Account Agreement and the Consumer Account Fee and Information Schedule for details.

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.  For information on the amount of insurance afforded depositors and how depositors can maximize the amount of money insured by owning deposit accounts in different ownership categories, please refer to www.fdic.gov.

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.

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

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

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M - R

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.

Official Check
An official check is a check payable to a third party issued by Wells Fargo & Company.

Online Banking
A service that allows you to handle most banking activities from your computer via the Internet. Banking activities such as opening accounts, 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.

Point-Of-Sale (POS)
A merchant transaction (purchase or return) made through a store, telephone, or internet using an ATM card or debit card.

Regulation D
A Federal Reserve Board regulation that sets a withdrawal and transfer limit from a savings account held at a depository bank and an early withdrawal penalty on a withdrawal from or closure of a time account (CD). 

Returned Item

See Non-sufficient Funds (NSF).

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.

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S – Z

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. Select Wells Fargo savings accounts permit limited check access.

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).

Simplified Employee Pension (SEP) IRA
An IRA that receives employer contributions pursuant to a simplified employer pension plan, used typically by self-employed people or small companies.

Stop Payment Order
When you ask the bank to not pay a particular check/transaction that you have written on your account.

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. Cycles may be monthly, quarterly, semi-annual, or annual.

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. Wells Fargo's Time Account is also known as a CD.

Traditional IRA
A retirement account that allows individuals to set aside money each year. Contributions may be tax deductible and earnings grow tax-deferred. Deductible contributions and earnings are taxed when withdrawn, typically at retirement. A 10% IRS penalty may apply for pre-mature withdrawals.

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

Wire Transfer
Wells Fargo'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 everyday purchases and pay bills worldwide at participating retailers and service providers, including online or by phone
  • ATM withdrawals – get cash at ATMs worldwide
  • At any Wells Fargo banking location

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