Objectives

• Develop an understanding of credit
• Discuss credit cards and the costs associated with having one
• Consider the importance of maintaining records and building a good credit history

Suggested Activities

• What is credit? What are different types of credit?
• What are the upsides of having a credit card?
  • Convenient way to simplify bill paying
  • Don't have to carry large amounts of cash
  • Shop by telephone or over the Internet
  • Enables people to pay for items as part of their living expenses as opposed to waiting until they can afford to make the purchase.
  • Often required for making a reservation
• What are the downsides of having a credit card?
  • You can over-commit yourself and potentially lose your property
  • If you regularly charge more than you can afford to pay, you pay finance charges
  • They can be stolen and misused
• Use a drawing of a credit card to talk about what the information on the card means
  • Account number
  • Customer service number
  • Holographic image
  • Magnetic strip
  • Expiration dates
• Discuss costs associated with credit cards
  • Annual fees
  • Finance charges
  • Late payment fee
  • Over-your-limit fee
• Discuss the importance of record keeping and developing a sound credit history
  • Lost or stolen cards
  • Purchases you didn't make and billing errors
  • Defective merchandise
  • Credit reports

Tips for using The Home Zone to discuss the basics of credit

Go to Cool Stories:
• Watch "Home Ownership," which discusses the difference between owning and renting a home, some of the advantages of owning a home, and the concept of loans.
• Watch "Mortgages," which discusses what a mortgage is and the value of having good credit to facilitate getting one.

Go to Brain Food:
• Visit "Mindbuilder, Loans, Credit, and Credit Records" for a discussion about loans, credit cards, and credit reports.
• Visit "MindBuilder, The Value of Home Ownership" for a discussion of home ownership and getting a loan.
• Visit "MindBuilder, What is a Mortgage?" for a discussion of mortgages and exercises in calculating loan payments.

Go to Glossary:
• Terms used in The Home Zone are defined here, including terminology related to credit and loans.

Go to Game Center:
• Play "HomeBuilder," which reinforces a variety of concepts addressed in The Home Zone.