Learning Objectives

• Learn about the importance of being sensible with your personal finances

• Explore why people need to borrow money• Understand responsible borrowing and be able to

analyse different financial products• Assess the possible consequences of getting into

debt & the impact this can have on individuals & families

• Know where to find financial support & advice

I promise to make a positive contribution to today’s activities

I will listen to the evidence presented

I will respect the views of others

I will behave sensibly and maturely

Activity Instructions

In your groups discuss the following question…

Why do people borrow money?

Make notes and choose somebody to feedback from your table You have 5 minutes

Summary: Why Do People Borrow Money?

Financial Planning – making rational financial decisions

e.g. – You decide to take out a loan to cover a large purchase knowing you have the finances to pay for it

Buying things on impulse

e.g. – You see a special offer on a widescreen TV but you haven’t got the money so you take on a ‘Buy Now Pay Later’ deal to buy it

Unforeseen Circumstances – things you need to pay for but don’t have the money for

e.g. - Your car breaks down and you need to get it repaired quickly because you need it to get to work

Activity Instructions

Match the descriptions of different financial terms to the pictures

Choose a different person to feedback

You have 5 minutes

Activity Instructions

For this activity imagine you are single and live by yourself

£1,500 is your monthly wage and you need to decide what to spend it on

Start by putting the money on your rent, utilities and mobile phone/internet – you have no choice with these categories

Decide whether you will travel by bus or have a car

Put at least the minimum on food and savings

Everything else you decide how much to allocate

Work as a group – don’t let one person take over

You have 10 minutes

Unforeseen Circumstances

You can not take money from the following categories:

House/Flat

Utilities

Mobile Phone & Internet

Travel

You also have to keep the minimum of £200 on your food

Activity Instructions

You want to get a TV that costs £800You have 5 different options for buying the TVEach option has a list of terms & conditions and a list of pros and cons Share the cards out amongst your group and work individually or in pairs to look at the details of each optionOnce you have each read your cards discuss them all as a groupDecide as a group which option you are going to select to buy the TVWe will ask you to feed back which one you have chosen and how the terms and conditions influenced your choice and how you will alter your spending if your monthly payments are highThere are no right or wrong answers – each of the 5 options has its advantages and disadvantagesYou have 15 minutes

Maria

• Managing Director• Married• 2 children

John

• Graphic Designer• Single• No children

Adya

• Student• Single• No children

Dale

• Teaching Assistant• Divorced• 2 Children

Betty and Gil

• Retired• Married• 3 adult children

Activity Instructions

You are a company that gives people credit

As a business you make profit by lending people money but you have to be careful of the risk they may not be able to pay it back

Decide based on the information on the credit reports whether you would lend each person the money they want

Look out for any warning signs that they might be a risk: the debt they already have, their credit score, missed or late payments You have 10 minutes