Learning to save money is a very important life skill—especially for young people, who are making money for the first time and maybe don’t quite understand how fast their income can disappear.
But saving money is easier than it seems, and sometimes its the simplest-seeming advice that can be the most helpful. And learned at an early enough early age, it can make a lifetime of difference.
Last year, Alexa von Tobel, the founder and CEO of the personal finance website LearnVest, appeared on the Rachael Ray morning show to offer some financial advice. One bit of advice: just put away $5 a week, and by the end of the year you’ll have built a healthy savings account without even realizing it.
One person who took that advice to heart was a young teen named Janessia. Like most girls her age, she doesn’t have a very robust income—just some cash here and there between chores and birthdays.
So the $5 plan seemed like a good way to start saving—and a year later, the results are incredible.
When Alexa von Tobel returned to Rachael, Janessia was in the audience with her mother—and her stack of $5 bills, which she had saved over the past year at von Tobel’s advice.
She hadn’t counted her savings yet, but when asked she predicts that the total is “over 200, maybe.”
But anyone could see that this was far more than $200.
Rachael Ray is impressed by the young woman’s effort to save over the past year.
“It’s a big deal for a young person to realize that money does not literally grow on trees,” she tells Janessia.
But everyone is blown away to find out just how much the 14-year-old managed to save over the past year just by putting her fives away:
The crowd is stunned that the high schooler was able to save that much—but no one was more shocked than Janessia and her mother.
“Mom, aren’t you thrilled that at just 14, she’s listening to financial advice?” Ray asks.
So what is she going to do with all that money? While Rachael Ray jokes she should take a trip to Italy (a nod to a guest earlier in the program) von Tobel recommends putting it into a savings account—with proper investment, it could grow into thousands of dollars.
It’s a simple trick that yields major results—and now with the start of a new year, it might be worth a shot, especially if you have kids at home.