More INTERESTing News

There are two kinds of interest: simple interest and compound interest.

With simple interest, the credit union pays you interest only on the money you save.
If you save $100, the credit union will pay interest only on that $100 year after year.

Compound interest is a better deal. Here, the credit union pays you interest on the
money you deposit. Then it pays you interest on the interest you have already been paid.

Example: Start saving 25-50% of your allowance now and combine it with the
money you have in your Genisys Share Savings Account and the money you get
over the holidays. Once you reach $500, place it into a Term Certificate (like a
Flex Savings Certificate but with a $500 minimum balance and a higher interest
rate) for 5 years. If you get $10/week for allowance and save half each week,
you’ll have $20/month to deposit into this certificate and $20/month to spend. At
1.75% interest, you’ll have roughly $1,800 in 5 years. That’s an extra $100 in FREE
money you’ll save from interest that you could put towards your first car.

~Positive Promotion’s “Making $mart Money Decisions” Activity Book