Some people still think the best way to save their money is to hide it in their house. But the majority of people put their money in the bank. The bank protects your money from anything bad happening to it.

A savings account is a place in the bank where you can keep your money. When your money is in a savings account you can deposit (add money) or you can withdraw (take money out). Saving money in a bank is better than saving in a piggy bank or jar because sometimes if you save money at home lots of bad things could happen to the money. The money could burn in a fire, be lost, get stolen, or be spent since it's so easily available. 

When opening a savings account in most banks, you have to fill out a signature card. The bank will need some identification like your birth certificate. They also will need your social security number. If you are under eighteen, you will need a parent or guardian to help you open a savings account. Savings accounts earn interest. Interest is extra money the bank pays you for keeping your money in their bank.  Good deal!

Have you ever seen your mom pull out a small book at the store when it's time to pay? It was probably a checkbook. A checkbook holds checks. Checks are slips of paper that are worth the amount of money written on them. When you fill out a check, there are many things that you need to do. You have to write down the name of the person or business that you are sending the money to. You also have to fill out your name, date, subject, and the amount of money in numerals and letters.  The business then sends the check to their bank.  Eventually the money is taken from your checking account and placed in the business's account.  A lot of people use checks because they don't like carrying around large sums of money.

The amount of money you place in your checking account tells you how much money you can spend when writing out checks. For example, if I had $100 in my checking account, I could only write a check for $100 or less. If I wrote, let's say, a $150 check when I only had $100 in my checking account, I would have to pay an overdraft fee which is a penalty.  You don't want to do that!

People need money to buy the things they want and need. But everyone should protect and save their money from loss.

Citations

Books

Godfrey, Neale S. Kid's Money Book. New York: Children's Financial Network, Inc.

Images  

Images of stack of bills, stack of coins, and bank vault from "Microsoft Office Online" <http://office.microsoft.com/clipart/default.aspx?cag=1> (February, 2004).

Glossary

Bank: A place where lots of money is stored.  Return

Savings Account: A place in the bank where people's money can be stored for "safe keeping".  Return

Checkbook: A book that holds checks and records of all the checks people have made out.  Return

Check: A slip of paper that is worth any amount of money that is written on it (as long as you have that much money in your account).  Return

Checking Account: An account where people keep the money that they use to write checks.  Return   

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