Time is money
17 March 2020
Rebecca Sparrow is a Suncorp Ambassador and a best-selling author, columnist, podcast host and passionate advocate for teenagers. She works closely with Suncorp and Financial Basics Foundation to champion financial literacy for young Australians. As a mother of three children, she understands the importance of talking about money with kids and the value of financial literacy education, both at school and home.
When I was 12, a financial advisor came to my school to talk to everyone in my grade about saving money. Now I love money as much as the next person but when I was 12, I thought this sounded pretty dull. But there’s one thing this man said which I’ve never forgotten and got the attention of everyone in the room. ‘Who would love to go on a trip around the world when you’re older?’ he asked us. Every student in that room shot up their hand. ‘So,’ he said. ‘Starting today I want you to save $1 every day. Just one dollar. And by the time you’re 18 you’ll probably have about $2000. Then, I want you to take the money – that’s a deposit – and put it into a high interest savings account.” He went on to explain that a high interest savings account, essentially meant that the bank would pay us money if we let them look after it.
‘Keep adding to it but you cannot touch it. And you can’t spend it.’ He said. ‘Instead you’re going to sit back and water it like you’re growing an apple tree. Watch it compound and grow bigger. And by the time you’re 30, you’ll be on the trip of a lifetime. Or you’ll have a deposit for a house.’
I’ve never forgotten what he told us that day about compound interest. It’s the “Time Is Money” Rule of Thumb.
TIP: As a family consider joining forces and putting some money away into a high interest savings account. Work out how long you’ll need to put the money away and how much interest you’ll have earned by the end of that period!
We know it’s one thing to explain a financial concept to children, but demonstrating it with real life behaviours can help them understand it better. We’ve developed these worksheets to provide you with additional activities and practical examples. Get the conversation started with your children by working through these family activities together.
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