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Experts agree: saving is important. So today Young Americans Bank shares a great tip for growing your savings: 70 / 20 / 10!
You might notice that 70 + 20 + 10 = 100. These numbers correspond to percents that you can use any time you receive money:
Some kids receive money as an allowance. Some earn money because they have a business, and they exchange a good or a service for money. Many kids receive money as gifts for holidays or birthdays. These are all examples of income, which is a word that means receiving money.
Any time you receive money, don’t spend it all at once! Divide it into three categories: spend, save, and share. The spend category is for items you need and want: clothes, food, toys, gifts and more. Use the save category to help you save for the future. Maybe you would like to have some spending money when you go on a trip or you’d like to buy a car when you turn 16. You’ll need savings for both. Finally, the share category is a way for you to give back to your community. You could make a monetary donation, or you can purchase something to donate–maybe nonperishable food for a hunger-relief program or new toys for a homeless shelter for families. KidsforColoradoGives.org is a great place to start if you want to give back.
Here’s one final tip: split your money right away! Young Americans Bank sells piggy banks that do this for you–there’s a section for savings, spending, and sharing. Or, get three jars and label them. You can even deposit your money into three separate bank accounts: a checking account for spending, a savings account for savings, and a separate savings account for sharing.
Ready to practice? Use this worksheet to help George decide how he will spend his birthday money. Good luck and happy saving!