2. Piggy Bank to Savings Account
We need to keep money in a safe place! A piggy bank is
good, but a savings account gives you....
ENSURED SAFETY OF MONEY: piggy banks break!
INTEREST ON SAVINGS: watch your money grow!
ABILITY TO USE CHEQUES: empty pockets? No problem!
USE OF DEBIT CARD
ABILITY TO GET A CREDIT RATING, A CREDIT CARD
ABILITY TO SAVE AND INVEST
3. Credit Cards, Free Money?
NO! Credit cards ARE NOT meant to spend frivolously!
Their purpose is to act as borrowed money, that you have
to give back later on!
PRECAUTION:
Interest: if you can’t pay your credit bill, the company
charges interest. This means that on the next monthly bill,
you have to pay more money, based on the percentage.
Ideally, when using a credit card, try to spend what you
actually have in the bank, but not in your hand. A bad credit
rating (like a bad reputation for not paying on time) can
prevent you from buying an apartment, or even getting
another card!
4. Writing Cheques
Cheques are a piece of paper that you give to a person as
a payment. You write the date, amount of the payment, and
your signature. The use of a cheque is means that this
person will be getting the amount from YOUR account, it is
not free money.
Cheques, like credit cards, can be a useful tool. However,
if you write a rubber check (sign for money that you do not
have in the account) you could be forced to pay a fee, or
even pay for the check itself!
5. Debit Cards
A debit card , like most banking tools, is an act of
convenience. The difference between a debit card and
credit card is that the debit card takes money straight from
your account. Safer, if you will.
If you don’t have the money, debit cards are just declined,
no extra costs....well except maybe some embarrassment.
6. What I Have Learned
I have learned so much about financial planning during this
course. For example, I have a debit card right now, and I
know how that all works. Conversely, I didn’t really have the
foggiest idea about credit cards. At this stage of my life, I
don’t I need one , but I am now well educated for when I do
get one. As for cheques, I also do not need them, but I can
now write a check properly. Banking can really be teenager’
s worst nightmare, but it doesn’t have to be if you organize
and plan ahead.
