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From VOA Special English, |
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this is the Economics Report. |
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Are you a saver or a spender? |
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"A penny saved is a penny earned." |
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This old saying calls attention |
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to the wisdom of saving money. |
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"Putting money away for a rainy day" |
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is another way to talk about saving for the future. |
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People who hate to spend money are known as "tightwads," |
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while those who like to get the most value |
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for their money are called "thrifty." |
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A thrifty person is different from a "spendthrift." |
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A spendthrift is someone who spends wastefully. |
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People like that are often said to spend money |
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"like a drunken sailor" or "like there's no tomorrow." |
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In the United States, |
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people who want to start a savings account |
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have different choices of where to put their money. |
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These include banks and credit unions. |
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Credit unions are cooperatives for people |
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who have some kind of connection. |
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For example, the members might work for a university |
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or a government agency. |
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Most credit unions are nonprofit organizations. |
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Credit unions, banks and other financial institutions |
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pay interest on savings accounts. |
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But the interest rates are low. |
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Certificates of deposit pay higher returns. |
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With a certificate of deposit, or CD, |
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a person agrees not to withdraw the money |
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for a certain period of time. |
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This term could be anywhere from a few months to several years. |
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Longer terms, and larger amounts, pay higher interest. |
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People can withdraw their money early |
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but they have to pay a penalty. |
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Another way to save is through a money market fund. |
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This is a kind of mutual fund. |
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Mutual funds invest money from many people. |
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The money is sometimes placed in short-term government securities. |
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Money market funds, however, may not be federally guaranteed |
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like other kinds of savings. |
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The Federal Deposit Insurance Corporation guarantees savings |
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up to two hundred fifty thousand dollars. |
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In a number of countries, |
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people have been saving less over the years. |
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The Organization for Economic Cooperation and Development |
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is a group of thirty-four countries. |
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The OECD says in nineteen ninety, |
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Americans had a household savings rate of seven percent. |
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This year, that rate is expected to be a little more |
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than two percent. |
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Many European countries have higher rates, |
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but Americans save more than families in Japan. |
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And that's the Economics Report. |
