Ms. Smith
A safe and easy way to save your money.
Allows you to deposit money (add money to your account)
or withdraw money (remove money from your account) at
any time.
1. Pick a bank.
2. Then, go to the bank and fill out the necessary
paperwork needed to open a savings account.
3. After completing the forms, you will need to
deposit a minimum amount of money.
*For minors, the usual amount is at least $50.00.
4. Congratulations…now it’s time to start saving!!!
Steven Jones:
122 Yosemite Street, Hamilton, NJ 08620
Account #264256971
On September 20, 2011, Steven Jones deposits the
following:
$150 in cash
2.75 in coins
Check #132: 125.35
Check #1602: 395.00
On September 21, 2011, Steven Jones withdrawals the
following:
215.00 in cash
Bank Savings Account: offered by all banks; yield a
low interest rate.
Money Market Account: offered by banks and typically
pays you a higher interest rate than a regular savings
account, but requires higher deposit.
CD or Certificate of Deposit: bank holds your money for
a set period of time, usually 1-6 months or 1-5 years.
Unlike a normal savings account, you may not withdraw your
money at any time. But if you do, you will be subject to
withdrawal fees.
U.S. Savings Bond: initial investment of money, that if
kept long enough, matures with interest.
In return for keeping your money at the bank, the
bank pays you money, also known as interest.
Compound Interest : interest that is calculated on both the
amount you have on deposit and interest that has
accumulated in the past.
Which would you rather have: a
$100 bill or a penny that doubles
everyday for 30 days?
If you have a penny that doubles
everyday for 30 days, how much
will you have?
Working with a partner, calculate how much this
amounts to!
Formula:
.01 x 2 = #, # x 2, and so on
5.4 million
Now that we know about
the 4 types of savings
accounts, how do we decide
what’s the best choice for
ourselves???
Pros:
Low minimum balance
required
Easy to withdrawal funds
Insured
Cons:
Low rate of return
(current rates are below 1%)
Withdrawal charges
Pros: Cons:
Highest interest rates Minimum deposit/
among all other balance required is
bank savings high
accounts No interest and
Check writing possible service
involved charge if balance is
Insured below a certain
balance
Pros: Cons:
Interest rates are Penalty for early
better than that of a withdrawal
regular savings Larger sum of money
Guaranteed interest required for minimum
rate for time of CD deposit
Insured
Pros: Cons:
Low minimum deposit Length of maturity
($25 is the minimum amount)
Lower rate of return
Guaranteed by the when cashed in
government before bond
Free from state and reaches maturity
local taxes date