Chapter 3: There are lots of ways to save!

One day in the land of Frontenac, Penny, Buck and Bill had just made their first deposit into their new FrontenacKids Club Savings Account.

On their way home, Penny said, "I can't wait until I have enough money to open up a CD!"

"What's a CD?" asked Buck.

"A CD," Penny replied, "is also called a Certificate of Deposit. It's a special kind of savings account where you agree to keep your money "deposited" at the bank for a period of time."

"Like a week?" asked Bill.

"No," said Penny. "With a CD, you have to keep your money at the bank much longer. You can have a CD for 91 days, for 2 years or even as long as 5 years."

"Five years!" said Buck. "I don't want the bank to keep my money for 5 years. That's too long."

"You'll save a lot of money in 5 years," said Penny. "Besides, if you don't like CDs, there are lots of other ways for you to save money at a bank."

"Like how?" asked Bill.

"Well, there's the FrontenacKids Club," said Penny. "That's a Savings Account."

"The Savings Account is where the bank sends you a piece of paper in the mail that tells you how much money is in your savings account."

"My mom also has a special account to help her save for retirement."

"What's retirement?" asked Bill.

"I know," said Buck. "My grandmom and granddad saved money for a long time. They told me retirement was when you can stop working everyday and have more time to play with your grandchildren."

"It's like that," said Penny. "But you don't always have to wait until you're as old as Buck's grandparents to retire. If you save lots of money, you can retire whenever you want!"

"Then, I want to start saving for retirement now!" said Bill. "I want to retire next week."

"I just want to save for a new skateboard," said Buck. "I want to go skateboarding next week."

"You'll need to save a lot of money," said Penny.

"I bet I can save a dollar a day," said Bill. "How much does that make?"

"If you save a dollar a day for seven days or one week, you'll have seven dollars," said Penny.

"Is that enough for retirement?," asked Bill.

"No," said Buck, "but it's about half as much as I need for a new skateboard!"

Bill still wanted to save a dollar a day. Do you know how much money Bill would have if: (Ask your mom or dad if you need help with the math.)

He saved a dollar a day for two weeks?

He saved a dollar a day for the month of May?

He saved a dollar a day for one year?

He saved a dollar a day for two years?

He saved a dollar a day for five years?

Click here to see the answers: