As a 5th grader, I had a passbook savings account at my local bank. The bank worked with my school to get kids interested in saving money and earning interest. I remember filling out the paperwork and getting my parents’ signatures.
Next, I raided part of my life savings from my piggy bank. It was a ceramic pig with a hole in the bottom and a rubber stopper. I placed it all in the envelope provided by the bank and turned it in to my teacher the next day.
About a month later, my teacher handed my brand-new passbook to me. It was a small physical notebook with the name and logo of the bank on the cover. Inside the front cover were my name, home address, school name, and account number. The passbook had little ledger pages with an interesting texture, thickness, and earth-toned colors, much like the passports issued today but a little smaller.
I looked inside and noticed that the bank had recorded three entries. They were my initial deposit of $10, my first month’s interest of four cents (5.0% interest on savings back then, not the paltry 0.01% interest rates of today), and my new total of $10.04. Each entry was dated and printed in a different font or color of ink. The deposit was black, the interest was green, and the TOTAL (that entry was dramatically in all caps) was a bold purple.
I continued to participate each month by depositing some of the money that I’d received for birthdays and holidays. Later I added money I earned doing odd jobs for my parents and from collecting aluminum cans for recycling. I eagerly looked forward to receiving my passbook and watching my account grow with each deposit and interest payment. Over the next three years, I accumulated a grand sum of over $100.
At the end of my 8th grade school year, my father retired from the military and we moved. I had to cash out my passbook savings account and sadly, the bank kept my precious little passbook. Unfortunately, I would not have a fun savings and investment vehicle like this again until I was a young adult and parent. The joy and engagement in personal finance of that passbook were what I strived for when finding a way to teach my children about managing money. It was the foundation of the program that my daughters and I called Daddy401k.