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 DID YOU KNOW?
SELECT OTHER LESSON PLANS
 Select One Lesson 1: INVEST IN YOURSELF Lesson 2: THE BUSINESS OF INTEREST Lesson 3: PAY CREDIT WHEN CREDIT IS DUE Lesson 4: RISKY BUSINESS -- OR NOT!
PAY CREDIT WHEN CREDIT IS DUE

OVERVIEW

In this lesson, students will learn about credit cards and credit scores. They will investigate and comprehend the concepts of credit and credit ratings, or scores. Students will then watch a clip of WHAT'S UP IN FINANCE? to see how a small-business owner named Anna is reviewed positively by a lending committee based on her strong credit rating. Students will use the "It Costs What?!" online interactivity to learn about the different costs of borrowing money on a credit card. Students will then complete a hands-on activity in which they examine a hypothetical credit-history scenario and learn how specific actions impact a person's credit score. Then, students will have an opportunity to help repair the person's credit score by choosing a series of actions that will help build a positive credit history.

Finally, students will compare different credit card offers for young people, and determine which card offers the best deal. Students will use a chart to make a comparison of the different features of the cards, including annual fees, APRs, and rewards.

TIME ALLOTMENT: 3 classes at 45 minutes per class

SUBJECT MATTER: Math, Finance, Economics

LEARNING OBJECTIVES

Students will be able to:
• Understand the concept of credit
• Understand the components of a credit score
• Understand the importance of having good credit
• Learn techniques for building a strong credit history
• Understand the concept of interest
• Compute interest amounts on a loan
• Learn how to analyze different interest rates

STANDARDS

1. National Council of Teachers and Mathematics
Principles and Standards for School Mathematics

Number and Operations
• Understand numbers, ways of representing numbers, relationships among numbers, and number systems;
• Understand meanings of operations and how they relate to one another;
• Compute fluently and make reasonable estimates.

Problem Solving
• Build new mathematical knowledge through problem solving;
• Solve problems that arise in mathematics and in other contexts;
• Apply and adapt a variety of appropriate strategies to solve problems;
• Monitor and reflect on the process of mathematical problem solving.

Connections
• Recognize and use connections among mathematical ideas;
• Understand how mathematical ideas interconnect and build on one another to produce a coherent whole;
• Recognize and apply mathematics in contexts outside of mathematics.

2. JumpStart Coalition for Personal Financial Literacy

Money Management
Students will be able to:

1. Explain how limited personal financial resources affect the choices people make.
2. Identify the opportunity cost of financial decisions.
3. Discuss the importance of taking responsibility for personal financial decisions.

Spending and Credit
Students will be able to:

1. Compare the benefits and costs of spending decisions.
2. Evaluate information about products and services.
4. Analyze the benefits and costs of consumer credit.
5. Compare sources of consumer credit.
6. Explain factors that affect creditworthiness and the purpose of credit records.
7. Identify ways to avoid or correct credit problems.

3. Mid-continent Research for Education and Learning (McREL)

Benchmarks for Economics

Standards
Understands that scarcity of productive resources requires choices that generate opportunity costs.

MEDIA COMPONENTS

Video:

Web site:

"It Costs What?!" game
http://www.thirteen.org/finance/games/itcostswhat.html
The goal of this game is to compare the cost that interest and fees can add to a purchase when the purchase is made using a credit card. Students compare the costs of using credit cards with varying interest rates, learn about important credit card terminology, and discover ways to responsibly manage credit.

MATERIALS

Teachers will need the following supplies:
• Computer with connection to a screen or television on which to project the Web-based video clips, or computer stations where students can watch the clips
• Board and/or chart paper
• "Credit Card Components" Teacher Organizer
• "Credit Card Offers" and "Credit Card Comparison" Answer Key

Students will need the following supplies:
• Computers with Internet access (for individuals or groups)
• Notebook or journal
• Pens or pencils
• Calculator
• "Credit Score" Student Organizer
• "Credit History" Student Organizer
• "Credit Card Offers" and "Credit Card Comparison" Student Organizers

PREP FOR TEACHERS

1. Bookmark the Web sites used in the lesson on each computer in your classroom, or upload all links to an online bookmarking utility such as www.portaportal.com.

2. Preview all of the video clips and Web sites used in the lesson to make certain that they are appropriate for your students, currently available, and accessible from your classroom.