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piggy bank

A place to keep loose change or daily savings at home.

What it means

A piggy bank is a place to store small amounts of cash, usually in the form of a box, can, or other container where money is set aside little by little. In Indonesia, piggy banks are often used by children and adults to save daily without going through a bank. Money in a piggy bank does not earn interest and is not officially recorded, so it is only temporary storage.

Why it matters for families

Piggy banks help families build a saving habit and set aside loose change before the amount is enough to deposit in a bank. However, cash at home is prone to loss, damage, or being spent without record. If all savings are kept in a piggy bank, the family loses protection and cannot monitor fund growth.

Example

For example, every day the husband sets aside Rp5,000 of leftover shopping money into a piggy bank. In a month, about Rp150,000 is collected, which can be used to buy children's school supplies. Once there is enough, the money should be moved to a savings account to be safer.

Common misunderstanding

Many people think a piggy bank is the same as a bank savings account. The correction is that a piggy bank does not provide interest, is not guaranteed by a deposit insurance institution, and has no transaction records.

Next step

This term makes more sense once you see the numbers for yourself.

Emergency fund →

Related terms

  • joint accountAn account used jointly by family members for household expenses.
  • debtAn obligation to pay a sum of money to another party due to a loan.
  • family budgetA plan for dividing monthly income into spending categories before the money is spent.
  • cash flowThe difference between money coming in and money going out in one period.

Definitions in this glossary are educational. For documents that are legally or financially binding, confirm with the party that issued them.

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The calculators and guides here are educational and are not personal financial or legal advice.