Animal Crossing: New Horizons has been out for quite some time now. And it’s more than just a video game – there are real-life personal finance lessons you’ll learn by just playing the game.

The game itself is a life simulation that takes place on a deserted island. You arrive and use the island’s colorful natural resources to create a brand new town and community. The game features a cast of friendly animal characters and gives players daily tasks to complete.

You can plant flowers, go fishing, or dig up fossils to donate to the local museum. Selling items you find or create earns you Bells, the game’s own currency. You can then use these Bells to spruce up your island even more. The game’s charm and pace are perfect for relaxing and forgetting about the real world for a while.

Animal Crossing can also inspire some interesting conversations about economics and personal finances. The following are some useful personal finance tips from the latest version of Animal Crossing:

Personal Finance Tip: Your Mortgage Isn’t Everything

Tom Nook is the first character you meet in Animal Crossing: New Horizons. He helps you build your first house and gives you a mortgage to pay it off. Over time, you’ll add new rooms and extensions to your house that rack up even higher mortgage costs (albeit at a zero-percent interest rate).

Animal Crossing standing in front of house.

When all is said and done, it’s possible to sink millions of Bells into growing your small mansion. 

Much of your time in Animal Crossing is spent paying down this debt. From making and selling items to scavenging for rarities, everything can be sold. The game is built around paying off this seemingly never ending mortgage.

But getting wrapped up in only paying down your debt isn’t fun. Just like the real world, your debt isn’t your only focus and purpose.

It’s important to travel, hang out with friends, and learn new skills. As you spend more time in the game, you’ll realize that building a bigger house isn’t everything.

Personal Finance Tip: Using Your Savings Account — Smart Idea?

Animal Crossing gives you an ATM to deposit your extra Bells for safe keeping. On the first of every month, you’ll get a 0.5% interest rate on the money you save.

Checking the ATM in Animal Crossing

That interest rate is extremely good compared to the national average . Most Americans see an average annual interest rate of about 0.9%.

Savings accounts are valuable to save money for a rainy day like an emergency fund. But they’re not powerful financial vehicles for growing your wealth.

A better use of excess money can be investing in your employer’s retirement plan or your own IRA. Investing ties up money for a while, but is historically a smarter long-term financial play.

Personal Finance Tip: Investing in the Stalk Market

Animal Crossing introduced a mock stock market in its newest version. Known as the Stalk Market, it can be a lucrative way to make extra Bells.

The idea is simple. You buy turnips from a town visitor named Daisy Mae every Sunday. Her turnip price fluctuates week to week, so there’s no telling what she’ll sell them for.

You can then potentially sell them for a profit at the Nook shop. But the price they’re willing to pay also varies. Timmy and Tommy give two prices for turnips daily; once in the morning and once in the afternoon.

If you sit on your turnips too long, they’ll rot and become worthless. So you have to strike while the iron’s hot. Unfortunately, it’s hard to know when the best time to buy and sell is. Turnip prices always fluctuate and the Nook boys may not be in the mood to pay a premium for your crop.

Like real stocks, it’s nearly impossible to time the market. But if you’re lucky, you can make a big profit when the market swings in your favor. If you’re not careful though, you stand to lose it all.

Personal Finance Tip: Budgeting Like a Nook

Nook Miles are a secondary currency in Animal Crossing New Horizons. Arguably, they’re more important than Bells. You can use them to travel to new islands and buy exclusive upgrades you can’t find at the shops. 

Nook Miles are important for buying things in Animal Crossing.

But Nook Miles, like money, are hard to come by. Spending them all on plane tickets means that other areas of your financial life take a backseat.

Animal Crossing has done a great job creating a real life budgeting system within the game. Working hard to collect miles you spend on upgrades takes time. It’s important you spend your miles wisely!

Personal Finance Tip: Sell Your Old Stuff

Animal Crossing’s entire ecosystem is built on selling things you make and find. Often, you’ll find seemingly useless junk everywhere.

From trash you find in the ocean to knick knacks you can’t find a good place for in your house, stuff is abundant.

Selling this extra stuff can net you some Bells to pay down your mortgage or upgrade your lifestyle.

You’ve probably got a lot of old stuff in your garage, closets, or attic. Sort through it and see if you can sell any of it on eBay or Facebook Marketplace for some extra cash! Pay down your debts or put it towards an emergency fund.

Personal Finance Tip: Hard Work Pays Off

Hard work and consistency pay off in the game. Daily chores and tasks can yield new items, goodies, and regular crafting supplies.

This routine is a cornerstone of the game’s mechanics. It is the best way to progress forward in building out your island.

There are workarounds and cheats floating around to get millions of Bells quickly. But there’s no substitute for taking it one day at a time and chipping away at your goals.

Personal Finance Tip: Have a Financial Plan

Plopping down your new house or Nook’s Cranny is easy. You find a clearing on the island and confirm your decisions with just a few clicks on the Switch.

Tom Nook reassures you throughout the game that you can change your mind at a later date if you want to. What he doesn’t tell you is that it’ll cost you!

Designing your island takes time. And getting it right from the start is the best way to save money.

Moving buildings around costs 50,000 Bells, which is a big blow to your wallet if you’re not active in the Stalk Market. 

Having a plan will help your island thrive from the beginning so you’re not moving things around later on to make room for new buildings.

Do some research about your own financial life and goals and see what roadmaps others have shared to easily achieve them.

Browsing the Nook Cranny Shop

Personal Finance Tip: You Can’t Win—And That’s OK

Finally, one of the most endearing parts of Animal Crossing is that you can’t ever win. The gameplay is infinite and there are always new surprises to find. And this is probably the biggest personal finance lesson you’ll learn from Animal Crossing.

Reframing your financial perspective to not be in competition with others is eye opening. When there are no times to beat, timelines to rush through, or objectives to hit, life feels a lot more freeing.

When you stop comparing yourself to your neighbors, you find happiness in what you already have. Enjoy the little things like a fresh peach or pear and don’t worry about the types of trees your neighbors have. Unless they’re money trees. =)

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