You remember that ceramic adornment from your childhood — it sat on a shelf in your bedroom as a precious commodity. While you may no longer want a stash to pay the ice cream man, a piggy bank can be a major financial resource for unexpected expenses and occasional splurges. A piggy bank can force you to change your spending habits, build up a reserve of cash and save money in ways you might not have considered.
Spending Habits
Once you are used to saving coins, you'll want to make a game of it and see how much rattling noise you can make in your piggy bank every day. You'll use cash more often -- and stop racking up credit card debt. Actually seeing that cash in your wallet disappear will also make you question what you really need to buy, cutting back on your overall spending.
No Piggy Bank Fees
Instead of socking away your coins, you could put modest amounts of money into a savings account. But your bank might deplete the account with maintenance fees that will probably cost you more money than what you earn in interest. Real money in your home is accessible currency ready to use when you need it.
Pennies And Quarters Add Up
Your change will add up over time, especially if you make it a habit to use cash. If you spend $4.30 twice a day on coffee, using a $5 bill each time, that's a total of $1.40 every day you're putting away. In less than four months, you'll have $200 saved -- and you won't even miss it. Remember the thrill you felt the first time you found a $20 bill in the pocket of an old pair of jeans -- now feel it when you count up the change in your piggy bank.
Expensive Debt
Sure, it may be a hassle to take those coins to the bank to turn them into bills. But spending real money instead of buying on credit can save you big time in the long run. If you bought something on credit for $200 and carried the debt on a card with 18 percent interest, it would take you 15 months to pay off if you only paid the minimum. Not to mention you would pay $24.80 in interest.
References
Writer Bio
Catherine Lovering has written about business, tax, careers and pets since 2006. Lovering holds a B.A. (political science), LL.B. (law) and LL.L. (civil law).