Money is something people use to buy things. Sellers agree to take it in exchange for what they sell. But people did not always have money. Before money, people used barter. Barter means trading things you have for things you want. It uses no money.
Barter has a problem. You need to find someone who has what you want. That person must also want what you have. Barter is slow. It is hard to arrange. That is why money helped trade. People have used many things as money.
Gold, feathers, cowrie shells, cattle and cacao beans were all used as money. Cowrie shells are small white shells. People used them as money in many places. They did so for thousands of years. Early money was often metal, such as silver, gold and a mix of the two called electrum.
The ancient Lydians lived in what is now Turkey. They invented coins. People in China made the first paper money, about a thousand years ago. Today, dollar bills are made of cotton and linen, not ordinary paper. The backs of U.S. bills are printed in green ink.
U.S. bill paper has red and blue fibers in it. They help make bills harder to copy. Bills of $5 and up have a watermark and a security thread in the paper. U.S. paper money is printed in two places. They are Washington, D.C., and Fort Worth, Texas.
Needs are things you must have, like clothes and groceries. Wants are extras you could live without, like a new guitar or the movies. Say you want to buy something but do not have the money yet. You can save until you have enough.
You can earn money by doing a job. When you get money, such as an allowance or a gift, you can decide how much to put in each of three jars. One jar is for spending. One is for sharing. One is for saving.
A bank is a safe place to keep money, so it will not be lost or stolen. Keeping a lot of cash at home is risky. That is one reason people use banks. Savings can be kept in a safe place, like a bank account. You can use them later for emergencies. You can also use them to buy something specific.
Words to know
- barter: trading things
- cacao: chocolate beans
- electrum: gold-silver mix
- watermark: mark in paper
- bank: safe money place
