Your Money And/Or Your Life...Get Your Finances In Order
Keep it safe-spend it with knowledge. So you've just got £50 from Auntie Jo and just started your first job, doing a morning paper round.
'What should I do with all this money', I hear you say?
You could spend it on a shiny new maths stationery set... hide it in the cookie jar next to your bed... give it to your mum for doing your laundry...(bwahahaha)
Or, you could give it to some strangers in suits. No, I'm not joking about giving to me, cos I don't wear a suit. You could invest it in a bank or building society. This can be a bit of a chore, if you live miles away from anywhere and haven't heard of a bank before, so pupiline.net is here to help you.
Banks have changed a lot since your grandma was little, so don't pay any attention to tales of dreary little buildings with straight lipped cashiers. Whilst banks and building societies are there to look after your money, they have become much more friendly and supportive to young people (though still not terribly exciting).
If you open an account when you're young and put, say, half of your earnings or cash prezzies from birthdays into it, you'll have a tidy sum to go on a luxury holiday to bognor regis when you're 20. wooooo.... ;)
However, enough of dreaming and back to the point in hand - how do you decide what sort of account to have, and which bank or building society to have it with?
- Bank Account: If you want to have quick access to your money, and you expect it to be going in and out of the account at a fair rate, a current account is a pretty good idea. This allows you to deposit money into the account and withdraw it whenever you feel like, and most banks now allow you to do this with a plastic card from the holes in the wall. You generally need a certain amount to start one (this can be as low as £1!), and some banks require approval of a parent, if you are under 16. When you reach 16 you can start an account by yourself, and there are generally more options for you to take advantage of, for example the plastic card might become more versatile. One down point, of these current accounts, is the low interest rate you get on your money because the bank can't rely on having it for long.
- Building Society: This is another well known type of account for holding money. Sometimes known as 'savings accounts', they're for the more long term investment of your hard earned cash. There are two main types of Building Societies - those who are owned by shareholders (like any normal company) and those that are owned by the investors (called "mutuals"). Investors are defined as people who open savings accounts. Both types offer a very safe home for your savings and pay interest on any money, you pay in. The reason this issue is in the news so much is that you could possibly benefit from a windfall, if enough of the members vote to convert the society to a publically listed company, or indeed sell the society to another company. Although you can't complain about getting money for nothing, the benefits of such a conversion are hotly debated about.
Now look at the following pages to get more detailed information and thoughts: