Question

Choose 4 of the scenarios and decide what the best option is and explain why? Online or Traditional Banking

1. It’s Sunday and you and your friend are planning on going to a local drive-in movie showing tonight. However, the drive-in movie theater only accepts cash for ticket and concession stand purchases. Your friend prefers to use their debit card to buy things and doesn’t typically carry cash, but they’ll need to obtain cash for tonight’s movie. It’s Sunday, so banks are closed. In this scenario, which option is best for your friend and why?


2. You and your friend are going to an outdoor mall today to walk around and do some window shopping. Your friend needs cash on hand in case he sees something he actually wants to buy so that he won't risk overspending. Once his cash is gone, he knows that he has reached his spending limit. However, his preferred bank branch is all the way across town and 30 minutes out of the way of the outdoor mall. He thinks there may be other branches nearby. In this scenario, which option is best for your friend and why?


3. Your family is thinking about moving to a different neighborhood in your school district. Your family needs to shop for a competitive mortgage interest rate before purchasing a home in the new neighborhood. In this scenario, which option is best for your family and why?


4. Your twin sister is saving up to buy her first car. She just started a new job bagging groceries at the local supermarket. She looks forward to payday, which is every other Friday, because it puts her closer to her savings goal of $5,000 for her new car. She is trying to figure out the easiest way to set aside $200 every two weeks when she gets paid. In this scenario, which option is best for your sister and why?

Answer 1

1. In this scenario, the best option for the friend would be traditional banking, as they need to obtain cash on a Sunday when banks are closed. Online banking would not be helpful in this case as they would not be able to withdraw cash from an ATM or bank branch. With traditional banking, the friend can use an ATM or a cash advance from a credit card to obtain the necessary cash for the drive-in movie.
2. In this scenario, online banking would be the best option for the friend, as it would allow them to locate nearby branches and ATMs to withdraw cash without having to drive across town to their preferred bank branch. They can easily access their account through their bank's mobile app or website to find the nearest ATM or branch location. This would save them time and effort, and ensure that they have access to cash for their shopping needs.
3. For the family looking to shop for a competitive mortgage interest rate, online banking would be the best option. Online banking allows for quick and easy access to multiple lenders and their rates, which can be compared side by side. Additionally, the family can use online mortgage calculators to estimate their monthly payments, closing costs, and other fees associated with their mortgage. With traditional banking, the family would need to visit multiple lenders and compare rates and terms manually, which could be time-consuming and difficult to do.
4. For the sister trying to set aside $200 every two weeks, online banking would be the best option. Online banking allows for automated transfers and scheduled payments, making it easy to set up a recurring transfer of $200 every two weeks from her checking account to a savings account. This way, the money is automatically set aside without the need for manual transfers or in-person visits to a bank branch. Additionally, the sister can track her savings progress and adjust her transfer amounts or frequency as needed, all through her bank's mobile app or website.