1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
kirza4 [7]
3 years ago
13

How to explain the banking system to young students

History
1 answer:
mr_godi [17]3 years ago
3 0

You’ve done a great job saving. Now, your parents want you to put those dollars and cents into a  safe of money savings account at a bank.

How do banks work? And how do people use banks?

Lots of people give their money to banks.

When you give your money to a bank, it’s called a deposit. Banks keep your money safe. AND, more importantly, banks will pay you for every dollar you keep in a savings account! The money the bank pays you is called interest. The bank will pay you interest every month you keep the money in your savings account!

You’re probably thinking, “Wait a second… banks pay ME money, and I don’t have to do anything? Why in the world would a bank pay me money to do nothing?”

Banks lend your money to other people.

If people don’t have enough money saved up to buy something, they often borrow money from the bank to buy big things, like houses and cars. The banks lend them the money to buy these things , but the banks expect people to pay the money back AND pay the bank a little extra money, besides.

Let’s say you borrowed $10 from a bank. You get the $10 right away. But when you pay back the $10, the bank will charge you $1 or $2 extra for giving you the money when you needed it. So you pay the bank $11 or $12. That’s how banks earn money.

Without money from people like you, banks wouldn’t have any money to lend. That’s why banks will pay you interest.

If you leave your money in savings…

Every month, the bank pays you for keeping money in your savings account. And over time, that extra money really adds up!

Imagine if your parents gave you $100 for your birthday every year for ten years. If you put it in your piggy bank, you’d have $1,000. But if you put it in a savings account, you might have $1,100 or even more. That’s an extra $100, and you didn’t have to lift a finger! That’s why it pays to open up a savings account!

You might be interested in
How did President Hoover react to the stock market crash of 1929?
Naily [24]
Herbert Hoover<span> on the Great Depression and New Deal, 1931–1933. The </span>stock market crashed<span> on Thursday, October 24, </span>1929<span>, less than eight months into </span>Herbert Hoover's<span> presidency. Most experts, including </span>Hoover<span>, thought the </span>crash<span> was part of a passing recession.</span>
4 0
3 years ago
Which person was an escaped slave who frequently gave speeches about his experience as a slave in an effort to have slavery abol
kirill115 [55]
Frederick Douglass

Please vote my answer branliest! Thanks.
8 0
3 years ago
Read 2 more answers
The constitutional convention was in ____, _____. The Constitution is the ___ of the land.
Andru [333]
The constitutional convention was held in Philadelphia, Pennsylvania. The constitution is the Law of the land.
8 0
2 years ago
In order to have a law, should all ideas be discussed before the law is voted on? why or why not?
defon
Yes because there could be a better idea plus fredom of speach

7 0
3 years ago
Read 2 more answers
When people have access to more technology, they tend to
kari74 [83]

Answer:

i think its c

Explanation:

not completely sure

7 0
3 years ago
Read 2 more answers
Other questions:
  • Which Invaders of the Roman Empire came from the farthest Eastern Point
    10·2 answers
  • Country Clues- Settlers from European Countries Questions
    11·1 answer
  • How long is the term of a federal judge in a constitutional court? A. two years B. four years C. six years D. lifetime
    10·2 answers
  • What are the characteristics of a Communist society?
    6·1 answer
  • Choose the word or phrase that best completes each sentence the 1954 ruling in brown blank explain how to carry out desegregatio
    9·1 answer
  • Why was the decision in Dred Scott v. Stanford so significant?
    5·1 answer
  • Why did pope gregory vii and henry iv come into conflict?
    10·1 answer
  • Which phrase best describes the economy of the former Soviet Union and present-day North Korea
    5·1 answer
  • Ce ani a fost Isus rastignit?
    11·1 answer
  • A major result of President Franklin D. Roosevelt’s New Deal was
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!