There are 3 things you can do with the money you earned or received as a gift or allowance:
- Spend it.
- Keep it in your wallet or piggy bank
- Deposit it in a savings account or invest it.
If you keep your money in your wallet, you’ll be more tempted to spend it! And $50 will still be worth $50 if you keep it in your hands for 2 years.
Spending all your money is no way to save. So what should you do?
Invest and see your savings grow
If you deposit part of your earnings in a savings account or you invest it with your C aisse populaire, your money will generate interest which will increase your wealth.
How much should I save?
You should put aside between 5% and 10% of your income. For example, if you earn $50, you should save between $2.50 and $5.00 a week.
Compound interest means more money
When it comes to savings, your age is your main advantage. By starting to save at en early age, and not making any withdrawals for several years, you could end up with a tidy little amount!
How does that work?
When you place your money in a savings account or investment, your C aisse populaire pays you interest.That’s money added to your savings: you earn money without knowing it!
With time, you’ll see your savings grow.
Here’s how much you could earn by investing only $10 a week*. The interest is the money you earned without having to work.
Weekly deposit of $10
|After 10 years||$5 218||$2 250||$7 468|
|After 20 years||$10 436||$11 726||$22 162|
|After 30 years||$15 654||$35 346||$51 000|
* This example assumes a return of 7%, compounded annually.
Invest regularly without thinking about it
The best way to invest money on a regular basis is to ask your C aisse populaire to automatically transfer an amount from your account to a savings account or investment. You can choose the amount and frequency (weekly, every 2 weeks, monthly). Not only are you earning money without working, but your money is deposited in your savings account without your having to lift a finger.