Send anyone this way to read along, but for permission to reprint, please contact Gail.
© Gail Underwood Parker

Saturday, May 26, 2012

Quick Takes: Money Grows... in a bank!

Here are two illustrations re saving money that I photographed while watching a TODAY show segment over a year ago.  They are very impressive even though each has a "but."  I think they are still wonderful.

The first graphic:
This can be used to show kids the value of steady saving and the importance of not touching your savings.  In it a single $1000 investment put in the bank on the day of a child's birth has only grown to $1595.62 in the first five years and only to $6,487.04 by 20 years. BUT, when the child retires at 65 years old the account will have almost half a million dollars [$435,664.43 to be exact!]  The but?...The sad part about this image is that I don't know anyplace you can invest $1000 and get a 9.8% interest rate these days!

The second graphic:
This shows the concept or and power of compounding where money pratically explodes. By compounding the money goes from a simple penny [1¢] on the first day to over 5 million by day 30! [$5,368,709.12   to be exact].
It is a good teaching tool to warn of the dangers of compounding interest on doans and credit cards. At first most kids will not believe the second graphic so be prepared to hand them a calculator and let them try it themselves.

Image credits: photographed from a 2011 TODAY show segment with Jean Chatzky. 

No comments:

Post a Comment