What is a check and how is it used?

• A. A type of savings account.
• B. A written instruction to a bank to pay money from a checking account to someone else.
• C. A loan agreement.
• D. A credit card.

Answer: (B)

A check is a written instruction to your bank to pay a specific amount of money from your checking account to another person or business. When you fill one out, you include the date, the amount in numbers and words, the recipient’s name, and your signature. The bank then transfers that money from your checking account to the recipient’s account, so the payment is made. Checks are useful because they provide a paper trail of payments and let you pay without cash or a card. They’re drawn from a checking account, not a savings account, and they aren’t borrowed money like a loan or a credit card. If there isn’t enough money in the account, the check can bounce.