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The Savings Jar That Grew a Dollar

4th grade nonfiction passage about interest on savings: 196 words, six questions, an answer key and vocabulary.

4th grade nonfiction interest on savings 196 words

The Savings Jar That Grew a Dollar

Keeping coins in a jar is safe, but the jar never gets any bigger on its own. Money kept in a savings account at a bank can. The bank pays you a small extra amount for letting it hold your money. That extra money is called interest.

Banks use a rate to work out interest. A rate is often written as a percent, which means "out of every 100." Pretend a bank pays 5 percent a year. That means for every 100 dollars you keep there, you earn 5 dollars each year.

Now suppose you put in 20 dollars. Twenty is one fifth of 100, so you earn one fifth of 5 dollars. That is 1 dollar. After one year, you have 21 dollars. You did nothing but wait.

A dollar may sound small. But the longer money stays in the bank, the more interest it can earn. Larger deposits earn more too. A person who saves 100 dollars would earn 5 dollars in the same year.

Interest rates change, and different banks offer different ones. A grown-up can help you compare them. Still, the lesson is clear. Saving is not only putting money away. With interest, your savings can slowly go to work for you.

Questions

  1. What is interest? in the text

  2. What does a percent mean? in the text

  3. In the example, how much does 100 dollars earn in a year at 5 percent? in the text

  4. How much interest does 20 dollars earn in the example? in the text

  5. Do all banks pay the same rate? in the text

  6. Why does a savings account have an advantage over a jar of coins? think about it

Words to know

interest
extra money a bank pays you for saving with it
savings
money that is kept and not spent
percent
a way to say how many out of 100
deposits
amounts of money put into a bank account
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One passage, three levels

The same topic and facts written three ways, so a mixed class can read and talk about one text. Each group’s sheet shows only a shape; the key says which is which.

● Easier · 155 words · Flesch-Kincaid grade 2.4

Coins in a jar are safe. But the jar never grows on its own. Money in a savings account at a bank can grow. The bank pays you a little extra for holding your money. That extra money is called interest.

A bank uses a rate to work out interest. A rate is often a percent. A percent means "out of every 100." Pretend a bank pays 5 percent a year. For every 100 dollars you keep there, you earn 5 dollars each year.

Say you put in 20 dollars. Twenty is one fifth of 100. So you earn one fifth of 5 dollars. That is 1 dollar. After a year, you have 21 dollars. You just waited.

A dollar may sound small. But money that stays longer can earn more. Bigger deposits earn more too. Saving 100 dollars would earn 5 dollars in that year.

Rates change, and banks differ. A grown-up can help you compare. With interest, your savings can go to work.

▲ This passage · 196 words · Flesch-Kincaid grade 3.5

Keeping coins in a jar is safe, but the jar never gets any bigger on its own. Money kept in a savings account at a bank can. The bank pays you a small extra amount for letting it hold your money. That extra money is called interest.

Banks use a rate to work out interest. A rate is often written as a percent, which means "out of every 100." Pretend a bank pays 5 percent a year. That means for every 100 dollars you keep there, you earn 5 dollars each year.

Now suppose you put in 20 dollars. Twenty is one fifth of 100, so you earn one fifth of 5 dollars. That is 1 dollar. After one year, you have 21 dollars. You did nothing but wait.

A dollar may sound small. But the longer money stays in the bank, the more interest it can earn. Larger deposits earn more too. A person who saves 100 dollars would earn 5 dollars in the same year.

Interest rates change, and different banks offer different ones. A grown-up can help you compare them. Still, the lesson is clear. Saving is not only putting money away. With interest, your savings can slowly go to work for you.

■ Harder · 213 words · Flesch-Kincaid grade 6.5

Keeping coins in a jar is perfectly safe, but the jar never grows any bigger by itself. Money that sits in a savings account at a bank, on the other hand, can increase. The bank pays you a small extra amount in exchange for letting it hold your money, and that additional money is known as interest.

Banks calculate interest using a rate, which is frequently written as a percent. A percent means "out of every 100." Pretend that a bank pays 5 percent each year. That means for every 100 dollars you leave in the account, you earn 5 dollars annually.

Now suppose you deposit 20 dollars. Twenty is exactly one fifth of 100, so you earn one fifth of 5 dollars, which is 1 dollar. After a single year, you would have 21 dollars. You accomplished that simply by waiting.

A dollar may sound insignificant. Yet the longer money remains in the bank, the more interest it can earn, and larger deposits earn more as well. A person who saves 100 dollars would earn 5 dollars over the same year.

Interest rates change, and different banks offer different ones, so a grown-up can help you compare them. The lesson is still clear. Saving is not merely putting money away, because with interest your savings can slowly go to work for you.

Download as one PDF

How to use it

  1. Press Read it big (or B) to put the text on the projector, or Full screen (F) to fill the whole screen.
  2. Ask the questions one at a time and use Show answer when the class has decided. A shows or hides every answer.
  3. Print student copy for the class, or Print with answers for yourself.

Ideas for class

  • Before reading, put interest, savings, percent and deposits on the board with their meanings from the Words to know section and have students predict what the text will be about.
  • Read it aloud once while students follow along, then have them reread it alone or with a partner. At a calm 100 words a minute it takes about 2 minutes to read aloud.
  • Use the Read it big button (or B) to put the text on the projector, and Show answer on one question at a time so the class commits to an answer first.
  • Question 6 asks the reader to infer. Ask students to point to the words in the passage that led them to their answer.
  • Ask students to write one question the passage did not answer, then look for the answer in a book or on a classroom screen.
  • Print the student copy for independent work and keep the answer-key copy for yourself.

Related

Questions

What reading level is "The Savings Jar That Grew a Dollar"?

It was written for 4th grade. It has 196 words and works out to a Flesch-Kincaid grade level of about 3.5. That is a formula's estimate from sentence length and syllables, and it is not a Lexile or a guided reading level, so check it against your students.

What do the questions ask?

There are six. 5 ask for something the text says directly and 1 ask the reader to work something out from clues. Each has an answer in the key, and the answers are written as a teacher would accept them, not as the only possible wording.

How long does it take to read?

About 2 minutes read aloud at 100 words a minute. For a one-minute fluency check, paste it into the fluency timer and use the word count.

Can I print it?

Yes. Print student copy gives the passage, the questions with lines to write on, and the word meanings. Print with answers gives the same page with the answers filled in. Both are made in your browser.

Is this passage from a published book?

No. It was written for Peabody Teach, so there is no book to buy and no login to read it.

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