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Money In The Bank
Your kid hears you or people around him use certain words when talking about money or banking. Among those words how do you explain to your kid what 'interest' means? Here’s an activity you can do with your kid which will help him understand this concept.
Requisites: Paper, pencil, play money or real money
1. Before beginning the activity explain to your kid why you keep money in the bank. First, to keep it safe and second, to earn more money in the form of interest.
2. Now explain to him that 'interest' is the money that bank gives you for letting them look after your money.
3. Now, on a paper draw two columns. In one column write any amount (e.g. Rs. 20) as in savings account. In the second column make four more columns and show how much interest for 1, 2 up to 4 days. (e.g. Rs.1 for 1st day, Rs. 2 for 2nd day and similarly till 4 days). Keep the amount less as it will be easy for your kid to understand and calculate.
4. Then, show him how to calculate interest for 1 to 4 days by adding interest to the savings account amount. (e.g. 20+1= Rs. 21).
5. Next, you can change the amount and ask him to calculate interest in the way you did. Also explain to him that the more you put and leave for longer time the more interest you will get.
With this activity your kid’s math will improve as well as his knowledge regarding banking activity will also increase and you probably will see him wanting to invest his money in bank.