The public school system covers almost all the bases for gearing children up for entry into the real world. However, it’s always shocked me that accounting or personal finance was never a mandatory course for children to take during grade school. It’s up the the individual to take the time on their own to educate themselves.
One can how to accumulate a substantial amount of wealth by simply investing their left over pennies. Here are a few simple ways to get started:
- Standard Savings Account
Now, with inflation these days, savings isn’t the most ideal way to increase one’s net worth, but it is effective. By simply setting up a direct deposit from each pay check to be deposited into a savings account prior to the funds hitting your checking account, it forces the individual to alter their life style to a new standard of living on less funds. Even as little as $20/month can make a world of difference over time.
Now, the downside to a standard savings account is the lack of interest rate payed by the banking institution. Standard savings account provide an interest rate of ~0.05%. The bank is then using your funds to in turn generate wealth at a much higher interest rate. This is an effective method for saving funds, but money being left in a standard savings account actually loses value overtime if inflation is greater than 0.05%. Not ideal!
2. High Yield Savings Account