BANKINGA teenagers confusing nightmare

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 CARDABILITY TO GET A CREDIT RATING, A CREDIT CARDABILITY TO SAVE AND INVEST

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!

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!

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.

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.