This is an absolutely true story. I may paraphrase a little because I didn’t record the incident but it was one of the funniest things that has happened in my family. Also, my kids might actually be learning something.
Two nights ago the dinner dishes had been cleared away and the girls were reading at the kitchen table (the one that lives in my living room because that’s the only place there’s space for it) and the mail came and there was a birthday check in there for $100 from her grandmother.
I said, “Congratulations, Big Sister! You know, we should open a savings account with that money so it’s not just hanging out around the house.”
She replied, “I have a piggy bank.”
I said, “Piggy banks are great for change and stray cash because it gives you one place to put it all. But eventually there’s enough in there it’s a good idea to put it somewhere even safer than your piggy bank. Plus, if you put it in a bank there is interest on the money.”
She responds emphatically with, “No, no. I don’t want one then. I’m good.”
I’m confused, but then Middle Sister says, “I think she’s mixing up interest you get on your money with interest you pay on borrowed money.” I figure it’s worth a shot and I say to Big Sister, “Honey, a savings account is where you loan the bank money so they owe you interest.”
I’ll be damned if she didn’t get a big grin and say, “Oh, then yes I want a bank account.”
I think the program at the bank that deposits $5 into your account for a report card with all As might improve her school performance as well.. We’ll see.
I’m amazed. My kids have actually been listening to me about money and compound interest. Hallelujah.