Banks and banking for families can feel big and surprising. In this friendly guide, Storypie explains how banks grew from temple stores into helpful phone apps. Cozy up and try a five minute savings story tonight to start a calm money chat.
Banks and Banking for Families: A very short history
Long ago, temples and palace storehouses in Mesopotamia and Egypt kept grain and valuables. They sometimes made loans too. In medieval Europe, merchants and Italian banks such as the Medici refined the idea. By the 1600s, English goldsmiths stored gold and issued receipts. Those receipts acted like early banknotes. The Bank of England, founded in 1694, helped shape modern central banking. Today, many families use mobile apps to move money in moments. It is marvelous and modern.
What banks do, simply
Banks keep money safe and help people pay for things. They also lend money, offer places to save, and give advice. Here are everyday examples that make this clear:
- Safe-keeping: A savings account stores money so you do not lose it.
- Payments: Current accounts and cards pay for groceries or tickets.
- Lending: Loans and mortgages help families buy homes or cars.
- Saving: Savings accounts and fixed-term accounts earn interest.
- Advice: Banks can explain options for big steps like buying a house.
Types of banks and how they earn money
There are several kinds of banks. Retail banks serve families. Commercial banks help businesses. Central banks set base interest rates. Investment banks and cooperative banks do other jobs. New fintech providers create fast digital services. Banks earn money mostly from the interest margin. That is the difference between what they pay savers and what they charge borrowers. In 2023, the U.S. banking industry reported a net income of $256.9 billion, a decrease of $6 billion (2.3%) from the previous year, but still above the pre-pandemic average, highlighting their resilience despite recent challenges, according to the American Bankers Association. For example, put ￡20 into a savings account at 2 percent and you would earn about 40 pence in a year. Tiny magic.
Keeping money safe
Banks are regulated, and many deposits are insured. In the U.S., the FDIC protects eligible deposits up to $250,000 per depositor, per bank. In the U.K., the FSCS protects up to ￡25,000 per person, per firm. Additionally, as of September 30, 2023, the federal banking system comprised 1,062 banks and federal branches, holding $15.4 trillion in assets, representing 66% of all U.S. bank assets, according to the Office of the Comptroller of the Currency. Banks also use PINs, two factor checks, fraud detection, and secure apps. Teach children to never share PINs, passwords, or one-time codes.
Everyday products for families
Common products include checking or current accounts, savings accounts, junior accounts, debit cards, loans, and mortgages. Many banks offer child friendly accounts with parental controls. Digital banking tools like mobile apps, contactless payments, and savings goals help children learn in small, safe steps. For playful practice, try a weekly savings chart or a small saving challenge.
Practical family activities and safety tips
Try these simple activities to make money talks gentle and fun:
- Read a five minute savings story tonight to start the habit.
- Try a weekly savings chart or a small saving challenge.
- Visit a local branch or show an ATM on a short walk.
- Open a child friendly account with parental oversight and match small deposits.
Also remember these safety tips. Always use official app stores and bank websites. Recognise scams and protect passwords. Important words to explain include deposit, withdrawal, interest, overdraft, mortgage, ATM, and direct debit. In 2023, the FDIC reported that 4.2% of U.S. households were unbanked, a slight decrease from 4.5% in 2021, which is an important aspect of financial inclusion, according to the Federal Deposit Insurance Corporation.
Read or listen to a story about Banks and Banking now: For 3-5 year olds, For 6-8 year olds, For 8-10 year olds, and For 10-12 year olds.
Final thought
Banks are older than you might guess and also wonderfully modern. Start small, keep it playful and steady, and watch saving become a super habit for life. For more family-friendly stories, explore Storypie’s learning pages and enjoy a cosy moment together.
