formerly FinancialForce
formerly FinancialForce
Math is the study of numbers. Accounting is the practice of managing money. Math and accounting go together because we need math to add, subtract, multiply, and divide money. These can be scary subjects for some people. When we look further, though, we find that managing money doesn’t have to worry us. Using simple math to take control of our money makes us a lot more confident. In fact, learning about math and accounting can be fun!
No matter what grade you are in or what you plan to do when you grow up, money is an important topic. We need to know how money is used. For example, small amounts of money come to us in coins. Larger amounts are usually in paper bills. We need to be able to count money and make change. We also need to know how and why to save our money.
A budget is a list of assets (money you have) and expenses (money you spend). For example, you might get an allowance; that’s an asset. If you use part of your allowance to buy a snack, that’s an expense. It’s no different for grownups. A paycheck is an asset, and the electric bill is an expense. Keeping your expenses lower than your assets is the key to growing your money. That’s because when you have some money left over, you can save it. After a while, all of that saving adds up.
One of the most common ways we use money is with a checking account. It used to be that checking accounts were just for writing paper checks. If you needed to buy groceries, you would write a check to the grocery store for the amount of your purchase. If you needed to pay a bill, you’d mail a check to the company or bank that you owed. These days, you might use a debit card to buy groceries instead of a check, but the money still comes out of a checking account. One of the best ways to learn about money is to try balancing a checkbook. That means keeping track of all of the money you put into the bank and all of the money you spend.
“Debit” and “credit” are terms accountants use to talk about money. To an accountant, debit means to put money into an account, and credit means to move money out of an account. But we also use these terms to describe payment cards. A debit card lets you spend money out of your checking account without writing a check. You can use your debit card at the grocery store to buy food, and the money is automatically sent from your bank to the store. A credit card, on the other hand, works like a loan. When you use a credit card at the grocery store, the bank that issued the card pays for your groceries. But you’ll need to pay the bank back later. If you wait too long, the bank will start to charge you interest, which is a fee for borrowing money.
Sometimes, the best way to learn about a subject is to play a game. When we do something fun, it’s easier to pay attention to it. Fortunately, there are plenty of good games and activities to help us learn about math and accounting. Many of these games are available online and are a great way to start learning more about money, budgeting, and accounts.