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Agenda

Plan to Earn
Reality Cheque
Where Does the Money Go?
Pay Yourself First
Saving for Life

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Plan To Earn

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Classroom Question

Over the next 1 minute discuss as a class:

What do you think is the single best predictor of your future income in life?

Teachers please put answers in the chat.

Before we dive deeper into money management, I want to ask you something: What do you think is the single best predictor of your future income in life? There’s one thing you can do for yourself that has the biggest impact on how much you’re likely to earn over time. If you’re thinking ‘job’ you’re close - but think about what usually comes before a job.

For those who guessed education, you’re right. Education is the single best predictor of future income. The more education or training you complete - whether that’s university, college, trades, apprenticeships, or certifications - the more opportunities you tend to have, and the higher your earning potential usually is.

But education isn’t the only factor. There are lots of things in life that affect how much money we earn and how much we spend - our choices, our responsibilities, where we live, our goals, and even unexpected events. That’s what we’re going to talk about next.

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5 main factors that impact finances:

Plan To Earn

Earning Income

Let’s thinking about some of the biggest factors that shape our financial future.

One of the most important is earning income - and what we choose to do with that income. The money we bring in, and the decisions we make about spending, saving, and planning, have a huge impact on our financial outlook. But before we even think about what’s going to cost us money in life, we have to understand where our money is going to come from.

Anns as we just talked about, education level plays a major role in your ability to earn money. The more training or education you complete - whether that’s university, college, trades, apprenticeships, or certifications - the more opportunities you tend to have, and the higher your earning potential usually is.

Of course, education isn’t the only factor. Your job choices, where you live, and your responsibilities, your habits, and even unexpected events all influence your financial situation. So let’s take a closer look at income possibilities based on our education level.

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Plan To Earn

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Plan To Earn

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Plan To Earn

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Plan To Earn

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Plan To Earn

Your ability to earn continues to climb the more educated you become.

For example, people who complete apprenticeships - like electricians, plumbers, or heavy-equipment technicians - can earn almost $2.7 million over their lifetime. And when we look at the very highest levels of education, like a doctoral degree, the earning potential is just shy of $5 million.

Of course, this depends a bit on your field of study and the demand for that type of work. Some careers pay more because they require specialized training, and some fields grow or shrink depending on technology, the economy, and what society needs. That’s why it’s important to think about the future of your career even when you’re just starting out - asking yourself whether this is a job people will still be doing in 30 or 40 years. Education doesn’t guarantee a specific salary, but it does increase your opportunities, your stability, and your long-term earning potential.

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5 main factors that impact finances:

1. Earning Income

2. Becoming a Couple

Plan To Earn

The next factor that can have a big impact on your finances is becoming a couple.

When two people live together, some expenses can actually go down. Things like rent, heat, electricity, and internet can be shared, so each person pays less than they would on their own. But other costs - like food - will go up because now you’re feeding two people instead of one.

If you’re both earning an income and sharing bills, this can be a really good time to start saving money. You have more financial flexibility, and you can build up savings faster than when you’re paying for everything alone. This is especially important if you’re thinking about getting married someday. The average wedding and honeymoon in Canada costs between $30,000 and $40,000 - which is almost the same as getting a post-secondary education. Now, it definitely doesn’t have to cost that much. Plenty of people get married for far less. But it’s important to plan for those expenses so you don’t go into debt just to get married. Being a couple can help your finances - but it’s important to plan ahead and make smart choices together.

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5 main factors that impact finances:

1. Earning Income

2. Becoming a Couple

3. Starting a Family

Plan To Earn

If you think a wedding is expensive… wait until you hear what it costs to have kids. Can anyone guess how much it costs to raise a child from 0-18 in Canada just by supplying them with the basics to keep them alive?

In Canada, raising a child from birth to age 18 costs around $250,000. And that number doesn’t include extras like vacations, hockey practice, dance lessons, new phones, school trips, or helping them save for post-secondary education. That’s just the basic cost of raising a child - food, clothing, housing, transportation, school supplies, and everyday living expenses.

Now, if we look back at the income levels we talked about earlier, the difference between not finishing high school and graduating high school is about $350,000 in lifetime earnings. That difference alone could be the gap between having more than enough money to raise a child comfortably vs. things being tight financially.

This is why understanding your earning potential and planning ahead matters. Life gets expensive, and the choices you make now can have a huge impact on your future financial stability.

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5 main factors that impact finances:

1. Earning Income

2. Becoming a Couple

3. Starting a Family

4. Property Ownership

Plan To Earn

The next factor that can have a big impact on your finances is where you live - specifically, whether you rent or own a home. Before I explain anything, I want to hear from you. Can you list any pros and cons of renting? What about buying a home? Let’s see what you come up with.

Here’s a few important points to add if we didn’t touch on them already.

Renting - Pros and Cons:

Pros:

Relatively carefree: You’re not responsible for major repairs or maintenance.
Lower upfront cost: You don’t need a huge down payment.
Flexibility: Leases are usually short (often one year), so it’s easier to move or change locations.

Cons:

No equity: You don’t build ownership or long-term value.
Limited control: You can’t make big changes or renovations.
Rent can increase: You’re not guaranteed the same price year after year.

Home Ownership - Pros and cons

Pros:

You build equity: Your home becomes a valuable asset over time.
Freedom: You can renovate, paint, upgrade - it’s yours.
Long-term stability: Mortgage payments are often more predictable than rent increases.

Cons:

Big financial commitment: Buying a home usually requires a large loan (a mortgage).
Upfront costs: Down payments, closing fees, inspections - it adds up.
Maintenance is your responsibility: If the roof leaks or the furnace breaks, you pay for it.
Less flexibility: It’s harder to move quickly when you own a home.

Both renting and owning have pros and cons, and neither is ‘better’ for everyone. WHat matters is your income, your lifestyle, your long-term plans, and how ready you are for the financial responsibilities that come with each option.

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5 main factors that impact finances:

1. Earning Income

2. Becoming a Couple

3. Starting a Family

4. Property Ownership

5. Everything Else

Plan To Earn

And finally, the last factor that can have a major impact on your finances is…everything else.

Life is full of expenses - travel, toys, renovations, accidents, medical costs, retirement planning, and even the general cost of living where you are. All of these things can affect how much money you have available. Some of these are fun expenses, like vacations or hobbies. Others are unexpected, like car repairs or medical bills. And some are long-term responsibilities, like saving for retirement or keeping up with rising costs in your city or province.

But it’s important to remember that it’s not just things that cost money that affect your finances. Sometimes your financial situation changes even when your expenses stay the same - for example, if you lose your job. Your costs haven’t gone up, but your income has gone down, and that can have a huge impact on your ability to manage money. So when we think about personal finance, we’re not just thinking about what we spend - we’re thinking about everything that can change how much money we have coming in or going out.

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Healthy Personal Finances

Require savings for:

Large Ticket Items
Unexpected Costs

Plan To Earn

Some of the factors we’ve talked about - things like education, becoming a couple, buying a home, or raising children - are big life decisions. They often require serious planning and, most importantly, building savings so you can afford them comfortably.

Savings are essential for large-ticket items, like a car, a house, a wedding, or post-secondary education. These aren’t things you can usually pay for with one paycheque, so having money set aside makes a huge difference. Savings are also critical for unexpected costs. Life doesn’t always go according to plan - accidents happen, medical expenses come up, jobs change, and emergencies pop out of nowhere.

Having a savings means you’re prepared. It means you can handle the big moments and the surprise moments without going into debt or feeling overwhelmed. So as we move into the next part of this presentation, keep in mind that saving isn’t just about putting money away - it’s about giving yourself stability, options, and peace of mind.

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Classroom Question

Over the next 2 minutes discuss as a class

What are some things YOU will have to spend money on in the next few years?

Teachers please put your students answers in the chat.

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Reality Cheque

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Statement of Earnings
Employee		Employee ID		Pay Period
Kim Yee		1234566789		01/06/24 - 15/06/24
Earnings	Hours	Rate	Gross Pay	Deductions
001 Basic Pay	40.00	$15.60/hr	624.00	Income Tax	49.92
				E.I.	3.96
				CPP/QPP	8.23
Gross Pay		Deductions		Net Pay
624.00		62.11		561.89
The hourly wage rate is based on Newfoundland and Labrador, 2024. Minimum wage differs from each province and territory.

Reality Cheque

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Statement of Earnings
Employee		Employee ID		Pay Period
Kim Yee		1234566789		01/06/24 - 15/06/24
Earnings	Hours	Rate	Gross Pay	Deductions
001 Basic Pay	40.00	$15.60/hr	624.00	Income Tax	49.92
				E.I.	3.96
				CPP/QPP	8.23
Gross Pay		Deductions		Net Pay
624.00		62.11		561.89
The hourly wage rate is based on Newfoundland and Labrador, 2024. Minimum wage differs from each province and territory.

Reality Cheque

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Statement of Earnings
Employee		Employee ID		Pay Period
Kim Yee		1234566789		01/06/24 - 15/06/24
Earnings	Hours	Rate	Gross Pay	Deductions
001 Basic Pay	40.00	$15.60/hr	624.00	Income Tax	49.92
				E.I.	3.96
				CPP/QPP	8.23
Gross Pay		Deductions		Net Pay
624.00		62.11		561.89
The hourly wage rate is based on Newfoundland and Labrador, 2024. Minimum wage differs from each province and territory.

Reality Cheque

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Statement of Earnings
Employee		Employee ID		Pay Period
Kim Yee		1234566789		01/06/24 - 15/06/24
Earnings	Hours	Rate	Gross Pay	Deductions
001 Basic Pay	40.00	$15.60/hr	624.00	Income Tax	49.92
				E.I.	3.96
				CPP/QPP	8.23
Gross Pay		Deductions		Net Pay
624.00		62.11		561.89
The hourly wage rate is based on Newfoundland and Labrador, 2024. Minimum wage differs from each province and territory.

Reality Cheque

Now let’s focus on your net pay - because this is the amount of money you actually receive. This is the number you can use to plan your budget.

Your net pay is what’s left over after all the deductions are taken off your gross pay. In financial terms, net refers to the amount remaining once everything that needs to be subtracted has been removed. This is the money that’s truly yours - the money you can save, spend on your needs, and use for your wants.

If you tried to budget using your gross pay instead of your net pay, you’d run into trouble right away. For example, if your gross pay was $500 but your net pay was $438, you’d be $62 behind on your budget the moment you got paid, before you even spent a dollar.

So when you’re planning your finances, always look at your net pay. That’s the real amount you have to work with.

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Where Does the Money Go?

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Classroom Question

Over the next 2.5 minutes discuss as a class

What happens to the money that’s deducted for income tax from your paycheque?

Teachers please put your students answers in the chat.

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Where Does the Money Go?

Let’s talk a bit more about taxes - because when you look at your pay stub, you’ll see deductions for both federal and provincial income tax. Income tax is money that goes to the government to pay for things we all use and rely on: schools, roads, healthcare, emergency services, parks, and many other public programs.

There’s also something called the basic personal amount. This is the amount of income you’re allowed to earn before you have to pay federal income tax. Most students working their first job don’t make very much in a year, so they often get all or most of their tax deductions back when they file their taxes.

You may have also heard about property tax. This is a tax paid to the city or town if you own a house. Property tax helps pay for local services like garbage collection, sewer systems, snow clearing, streetlights, and other things your community provides. It’s important to remember that property tax is an additional expense you have to plan for if you become a homeowner.

So when you see taxes on your pay stub, or hear about property tax, remember: these taxes fund the services and systems we all depend on every day.

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Where Does the Money Go?

Another deduction you’ll see on your pay stub is EI - Employment Insurance.

EI is money that comes off every paycheck, but it’s there to help you in situations where you can’t work or can’t find work. You may be able to collect EI if you’re having a hard time finding a job, if you can’t work because of a medical condition, if you’re on parental leave with a new child, or if you need to care for someone who is very ill.

There are also other reasons you might receive EI. For example, if your workplace closes down and you suddenly don’t have a job. This can happen if the place you work is only open during certain times of the year, like seasonal work, or if the business downsizes or shuts down completely.

EI is meant to support you during these tough times so you still have some income while you’re looking for work or dealing with a major life event.

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Where Does the Money Go?

Another deduction you’ll see on your pay stub is CPP - The Canada Pension Plan. If you live in Quebec, it’s called the Quebec Pension PLan, or QPP.

CPP is a federal program that uses money deducted from your wages to provide a basic income to citizens after they retire, or if they develop a severe disability that prevents them from working. These deductions start when you’re 18 and continue until 65. Every paycheck, a small portion goes toward your future.

When you retire, CPP gives you monthly payments to help cover your living expenses. It’s not meant to replace your entire income, but it does give you a foundation to build on. That’s why it’s important to remember that CPP alone may not be enough for retirement. You’ll want other savings too - like RRSPs, TFSAs, or workplace pension plans - to make sure you’re financially comfortable later in life. CPP is one piece of the puzzle, but your own savings will play a big role in your future financial stability.

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Where Does the Money Go?

So how do you know if the right amount of money has been deducted from your paycheck?

You find out when you file your income tax return - usually in March or April. When you file your taxes, the government checks how much you earned and how much tax was deducted. If you overpaid, you’ll get a refund. If you underpaid, you’ll owe a bit of money. This is why filing your taxes is important, even if you didn’t work very much.

Filing your taxes helps you access benefits, rebates, and credits that you might qualify for. It also keeps track of things like your TFSA contribution room - which we’ll talk more about later in the program. So filing your taxes isn’t just about paying money. It’s about making sure you get back what you’re owed and unlocking financial tools that can help you in the future.

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Saving for Life

Saving for life!

Prioritizing saving - and making it a regular part of your financial routine - is one of the best ways to reduce stress and give yourself better options when big or unexpected expenses come up.

Savings can be short-term or long-term. Short-term savings might be for something fun, like a purchase or a holiday this summer. Long-term savings might be for the post-secondary education, a car, or even your future home. Either way, knowing how you’re going to pay for something gives you confidence. It helps you feel in control and reassures you that you can meet your goals for the things that matter most to you.

Developing a saving routine also supports positive mental well-being. When you know you’re working toward your financial goals, you feel more secure, more organized, and more capable. So, let’s look at a strategy that works really well for building a saving routine - something simple that can help you stay consistent and reach your goals.

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Saving for Life

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Classroom Question

Over the next minute discuss as a class

What are some places you can keep your money?

Teachers please put your students answers in the chat.

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There are lots of places to keep your money, but the most common options are:

A bank account
A tax free savings account (TFSA)
A registered retirement savings plan (RRSP)

Besides putting your savings into a savings account, you can also invest them.

Saving for Life

There are lots of place you can keep your money, but some options are more common - and more useful - when you’re trying to build savings.

The most familiar place is a bank account. This is where most people keep their everyday money for spending, paying bills, and short-term saving.

Another option is a Tax-Free Savings Account (TFSA) which we will talk more about on the next slide.

There’s also the Registered Retirement Savings Plan (RRSP). This is designed for long-term saving for retirement. You get tax benefits for contributing, and it helps you build financial security for your future.

Besides putting your money into a savings account, you can aso invest it. Investing means using your money to buy things like stocks, bonds, or mutual funds that can grow in value over time.

We’ll talk more about these options later, but for now, just remember: you have choices. And choosing the right place to keep your money can help you reach your goals faster.

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A TFSA is a special type of account that lets Canadians invest their money, earn money on those investments, and not pay any taxes when withdrawn.

Saving for Life

Let’s talk about the TFSA - the Tax-Free Savings Account.

A TFSA is a special type of account that lets Canadians invest their money, earn money on those investments, and not pay any taxes when they withdraw it. You must be the age of majority to open a TFSA for yourself. In most provinces, that means you need to be 18.

Here’s how it works: when you put money into a TFSA, it can grow over time - through interest, investments, and other earnings - and you don’t pay tax on any of that growth. That’s what makes it such a powerful long-term savings tool. A TFSA isn’t just one single account. You can spread your TFSA savings across different places, like investment accounts, mutual funds, or regular savings accounts. As long as it’s registered as part of your TFSA, the growth stays tax-free. The government also sets yearly contribution limits, this year its $7,000. But if you check on your CRA account, it may be higher because the contribution limit continues to grow if it remains unused!

So remember: a TFSA helps your money grow faster because you get to keep all the earnings. No tax taken off the growth at all.

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Registered Savings Accounts are special government approved accounts that help people save money for important goals like education, retirement, or buying their home. They come with tax benefits that make saving easier.

Saving for Life

Now let’s look at Registered Savings Accounts. These are special, government-approved accounts that help people save money for important goals like education, retirement, or buying their first home. The reason these accounts are so helpful is that they come with tax benefits that make saving easier. You can have multiple registered savings plans open at the same time. For example, you might have an RESP for education, an RRSP for retirement, and an FHSA for saving toward your first home.

Different plans work in different ways, but most of them allow your money to grow without being taxed until you take it out or not at all. Some plans - like RRSPs - even let you deduct your contributions from your taxable income. That means you pay less tax while earning the same amount of money. A registered savings plan can be opened by you, or on your behalf by someone else. For example, many students have an RESP that their parents or guardians set up for them when they were younger.

The key idea is that registered savings accounts help you save for big life goals by giving you tax advantages and long-term growth opportunities.

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Interest is money you earn on the money you save or invest. In accounts like a TFSA or RRSP, your savings can grow over time because the bank or investment pays you interest.

Saving for Life

Interest is money you earn on the money you save or invest. In accounts like a TFSA or RRSP, your savings can grow over time because the bank or investment pays you interest. Most of the time, you’ll earn interest when you save or invest your money. But not all interest is created equal. There are two main types of interest you might earn: simple interest and compound interest. And there’s a big difference between them.

Simple interest is earned only on the initial amount you put in - also called the principal. So if you put $100 in an account and earn 5% simple interest, you’ll earn $5 every year. It doesn’t change, it doesn’t grow, it stays the same because you’re only earning interest on that original $100.

Compound interest works differently - and it’s much more powerful. Compound interest is earned on both your principal and the interest you’ve already earned. So what does that mean? It means your money grows faster because every year, you’re earning interest on a bigger amount. Your interest earns interest. This is why people say compound interest helps your money ‘snowball’ over time.

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	Simple interest (5%)	Compound interest (5%)
Initial Savings	$100	$100
Total after 1 year @ 5%	$105	$105
After 2 years	$110	$110.25
After 5 years	$125	$127.62
After 10 years	$150	$162.89
After 20 years	$200	$265.33

Saving for Life

So what does compound interest really mean for your savings? It means that after 20 years - even if you never added any extra money - the person earning compound interest would have earned over $65 more than the person earning simple interest. That difference keeps growing the longer your money stays invested. Compound interest rewards you for saving early and letting your money grow over time.

But don’t forget - interest doesn’t always work in your favour. When you save or invest, you earn interest. But when you borrow money - like with a credit card or a loan - you are the one paying interest. That’s why it’s so important to understand how interest works. It can help your savings grow, but t can also make borrowing more expensive if you’re not careful.

Next time, we’re going to talk about credit cards and loans - what borrowed money really costs, how interest is charged, and how to manage credit responsibly. Understanding interest now will make that lesson a lot easier.

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Thank you!

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Agenda

Budget Basics
Credit Sense
Common Credit Mistakes
Savvy Consumer

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Budget Basics

A Budget is a plan for how you will use your money. It shows how much you expect to earn, what you will spend your money on, and how much you will save.

A budget is a plan for how you will use your money. It shows how much you expect to earn, what you will spend your money on, and how much you will save. You’ll have a lot less trouble managing your money if you learn how to budget. Budgeting is just like planning your time - you only have a limited amount, so you have to choose carefully what you spend it on.

Have you ever thought you had enough money for something, but it turned out to be more expensive than you expected? Or maybe you really wanted something but knew you didn’t have enough money to buy it. Individuals, families, companies, cities, and even countries faces these same challenges. Life is expensive, and sometimes tough choices have to be made. If we avoid tough choices and spend more than we can afford, it leads to financial problems. The solution is to make a realistic list of your expenses, build a budget, and stick to it - even if that means giving up something you want.

A budget helps you keep your spending under control and reach your financial goals faster. Your budget has two main parts: income and expenses. Expenses are divided into two categories: fixed and variable.

Fixed expenses stay the same every month - things like rent or mortgage payments, loan payments, streaming or internet bills, and saving contributions.

Variable expenses change from month to month - like groceries, clothing, entertainment, or transportation.

You’ll see examples of fixed and variable expenses on the next couple of slides.

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Budget Basics

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Classroom Question

Over the next 2 minutes discuss as a class

What are some examples of variable expenses?

Teachers please put your students answers in the chat.

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Budget Basics

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Credit Sense

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Credit Sense

Credit is the ability to buy things now but pay for them later.

Debt is money you owe because you borrowed it and haven’t paid it back.

Interest is the extra money you pay when you borrow someone else’s money.

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Credit itself is neither good or bad!

Think of credit as a tool, like a hammer. The hammer is neither good nor bad, it’s just a tool. But a tool can help build things or tear things down.

Credit Sense

Credit itself is neither good nor bad. It’s just a tool - like a hammer. A hammer isn’t good or bad on its own, but it can build things or tear things down depending on how you use it.

Credit works the same way. If you make good choices, you’ll have access to the credit you need to buy important things - like a car, a home, or other big purchases - and you’ll have the ability to pay for those items over time. But if you make bad decisions, you could end up paying far more than the original purchase price. That extra cost comes from interest, fees, fines, and even higher interest rates on future credit. Poor credit decisions can also affect other parts of your life that might seem unrelated - like not being able to rent the apartment you want or even missing out on certain job opportunities.

One important question to ask before using credit is: If i don’t have the money now, will I have it later when I have to pay back the loan plus interest? Using credit means committing your future money to pay for something today. That’s why it’s so important to think ahead and make smart choices.

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Classroom Question

Over the next minute discuss as a class

What types of loans have you heard of?

Teachers please put your students answers in the chat.

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Credit Sense

Credit cards are one of the most widely used tools in Canadians’ personal finances. They’re convenient - often more convenient than cash - and they make everyday purchases easy. But here’s the catch: if you don’t pay the full balance at the end of the month, you’ll pay interest on whatever you still owe. That means everything you bought ends up costing more. Late payments or carrying a balance month after month can also hurt your credit score, which affects your ability to borrow in the future.

Student Loans:

Many people use student loans to help pay for education after high school. On average, higher education increases your income, but too much student loan debt can become harmful to your finances. It’s important to make a plan early for how you’ll pay for post-secondary education - whether through savings, scholarships, part-time work, or loans. And remember: there are consequences for not paying back student loans. They don’t just disappear, and failing to repay them can affect your credit, your ability to borrow later, and even your ability to qualify for certain programs or opportunities. However, luckily for people in Canada, student loans are interest free. So, as long as you are making your monthly payments, you only have to repay the exact amount you borrowed.

Mortgages:

Mortgages are loans used to buy houses - and for most people, a mortgage is the biggest type of credit they will ever take on. A mortgage can last 20, 25, or even 30 years, which is why understanding interest and borrowing is so important. Small decisions can affect your finances for decades.

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A Payday Loan is a short-term loan that gives you quick cash, but you must pay it back quickly, usually on your next payday. They carry extremely high interest rates.

Credit Sense

While there are types of credit that help us buy the things we need, there are also types of credit that we should avoid unless they are an absolute last resort.

A Payday Loan is a short-term loan that gives you quick cash, but you have to pay it back very quickly - usually on your next payday. These loans can carry extremely high interest rates. That means even a small loan can become very expensive, very fast.

There are also other types of loans designed for people who can’t access traditional credit because of poor credit history. These loans often come with much higher interest rates and extra fees, which can cost you a lot more in the long run. They should only be used in true emergencies, after you’ve exhausted all other options.

If you ever consider one of these loans, it’s extremely important to read the fine print and understand every detail of the contract. You need to know exactly what you’re agreeing to - the interest rate, the fees, the repayment schedule, and what happens if you miss a payment. High-risk loans can trap people in a cycle of debt. Use them only as a last resort, and only when you fully understand all the costs.

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A Pawn Shop is a place where you can borrow money by leaving something valuable like jewelry, electronics, or tools.

Credit Sense

A Pawn Shop is a place where you can borrow money by leaving something valuable, like jewelry, electronics, or tools, as collateral. It important to remember that the amount a pawn shop is willing to pay for an item is usually less than what the item is actually worth. They need to be able to resell it and still make a profit if you don’t repay the loan. For example, you could bring in a television and either sell it to the pawn shop for cash, or leave it as collateral for a loan. If you choose the loan option, you get cash now and then repay the loan with interest. If you repay it on time, you get the item back. But if you don’t repay the loan, the pawn shop keeps your item and sells it to recover the money you owe.

When you use a pawn shop, you risk losing the item you brought in. If you don’t have the money now, are you sure you’ll have the cash - plus interest - when it’s time to repay the loan and retrieve your possession? Pawn shop loans can be helpful in emergencies, but they can also be expensive and risky. It’s important to understand exactly what you’re agreeing to before you hand over something valuable.

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Rent-to-own is when you rent something first, like furniture or a tv, and make regular payments. If you keep paying long enough, you will eventually own the item.

Credit Sense

Rent-to-own is when you rent something first - like furniture, a TV, or an appliance - and make regular payments. If you keep paying long enough, you eventually own the item. Some of the things that make our home comfortable and convenient can be really expensive to buy outright. If someone doesn’t have savings and can’t get traditional credit, they might consider a rent-to-own store.

Furniture and appliances bought through rent-to-own plans usually cost much more - sometimes two or three times more - than buying the product outright. That extra cost comes from interest, fees, and the structure of the payment plan. This is why it’s extremely important to read and understand all the fine print in the contract. You need to know exactly what you’re agreeing to before you sign.

Rent-to-own can help people access items they need, but it’s one of the most expensive ways to borrow. It should only be used when there are no other options, and only when you fully understand the long-term cost.

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Credit Report and

Credit Score

When a bank decides whether to give you a loan or any type of credit, they look at a lot of different factors - and most of that information comes from your credit report. Your credit report is a record of how you’ve used credit in the past: whether you’ve paid your bills on time, how much debt you have, and how responsible you’ve been with borrowing. From that report, you’re given a credit score - a number that represents how trustworthy you are as a borrower.

The higher your credit score, the more likely you are to be approved for a loan. A higher score can also help you get a lower interest rate. Lower interest means you pay less money over time when repaying a loan or carrying a balance on a credit card. Even a small difference in interest rates can save you a lot of money in the long run.

Your credit score is basically a snapshot of your financial reliability. Good credit habits today - paying bills on time, keeping balances low, and borrowing responsibly - can make your future financial life much easier and much cheaper.

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Financial Institutions look a number of different things before they approve you for a loan.

Credit Sense

Financial institutions look at a number of different things before they approve you for a loan. They check how much debt you already have, your repayment history, and what other types of loans you might currently be paying off. They also look at whether your other loans are connected to an asset - something of value. For example, a mortgage is a loan used to buy a house, and the house itself is an asset. If you don’t repay the loan, the bank can take the house to recover the money.

When financial institutions offer you credit, they’re taking a risk. They’re trusting that you will repay the money - but there’s always a chance you won’t. So how do lenders decide who to lend to? They look at your past behaviour as a clue to what you’ll do in the future. If you’ve paid other loans and bills on time, there’s a good chance you’ll repay this loan too. But if you’ve missed payments or taken on too much debt, lenders may see you as a higher risk - which can lead to higher interest rates or even being denied credit.

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Classroom Question

Over the next 2 minutes discuss as a class

What do you think lenders are looking for in a borrower?

Teachers please put your students answers in the chat.

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Common Credit Mistakes

Now we’re going to watch a video on common credit mistakes. After that, I’m going to ask your a few true or false questions about credit - these are situations many people misunderstand.

1. If you co-sign a loan for another person and they don’t pay back the debt, it won’t affect your credit.

False. If you co-sign a loan, you are equally responsible for the debt. If the other person doesn’t pay, you are held accountable. Missed payments will appear on your credit report and can damage your credit score.

2. If you ask someone to co-sign a loan for you and you don’t pay the bill, you will both pay for bad credit with higher fees and interest rates.

True. Both you and your co-signer will face the consequences. Late or missed payments affect both credit scores, and future borrowing becomes more expensive.

3. Reading the fine print on credit offers is not too important. Most agreements are the same.

False. You should always read the fine print. Hidden fees, interest rates, penalties, and repayment rules can have a huge impact on how much money you actually end up paying back.

4. If you ever get into financial trouble and can’t pay a bill, contact the company immediately and ask about options.

True. This is absolutely the right thing to do. Contacting the company right away can help you avoid extra fees, stop the problem from getting worse, and reduce the damage to your credit score.

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Being a

Savvy Consumer

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Risk Management is predicting and minimizing the chance of financial loss. All consumers potentially face the risk of financial loss. It is important to be informed and prepared when it comes to your personal finances.

Being a Savvy Consumer

Risk management is predicting and minimizing the chance of financial loss. Every consumer faces the possibility of losing money at some point, so it’s important to be informed and prepared.

Financial risks can happen because of choices you make - and through no fault of your own. For example, both legitimate businesses and scammers want your money and will try to convince you to spend it. Accidents, car troubles, medical issues, and job losses can also happen unexpectedly. That’s just part of life.You can’t predict everything that might happen in the future, but you can learn about the risks that exist and how they might affect your financial plans. Being educated and prepared helps you make smarter decisions, avoid unnecessary losses, and protect yourself from situations that could harm your finances.

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Classroom Question

Over the next 2 minutes discuss as a class

What are some things that could have a negative impact on someone’s finances?

Teachers please put your students answers in the chat.

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Identity Theft is when someone steals your personal information, like your SIN number and birth certificate, and uses it to pretend to be you. They might open accounts, spend money, or access things in your name, which can cause serious financial problems.

Being a Savvy Consumer

Identity theft is when someone steals your personal information - like your SIN number, birth certificate details, banking information, or other private data - and uses it to pretend to be you. They might open accounts, borrow money, spend money, or access services in your name. This can cause serious financial problems.

Imagine doing a great job building your personal finances, saving money, and keeping good credit - but then someone pretends to be you and takes out loans they never pay back. Your financial reputation could be damaged or even ruined. And even though identity theft can be fixed, it’s often time-consuming, stressful, and expensive to repair.

These people might try to trick you into giving information away, steal documents, hack accounts, or use scams to get details you wouldn’t normally share. Be suspicious of anyone asking for information they don’t actually need. Your personal information is valuable - treat it carefully. Only share it with trusted sources, keep important documents secure, and be cautious online.

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A Password is a secret code you create to protect your accounts, devices, and personal information. A strong password is hard for others to guess and helps keeps your identity, money, and data safe from hackers.

Being a Savvy Consumer

A password is a secret code you create to protect your accounts, devices, and personal information. A strong password is hard for others to guess and helps keep your identity, money, and data safe from hackers. Passwords only work if you are the only one who knows them. If something is worth protecting with a password, it’s worth keeping that password safe.

Your phone should always have a password or passcode. If your phone is ever stolen and someone gets into your banking apps, they could transfer or spend your money. Banks often will not help you recover stolen funds if your phone didn’t have a password - because without a password, it’s considered unsecured access. So protecting your phone with a password is one of the simplest and most important steps you can take to keep your information and money safe.

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Tricks of the Trade & Common Frauds are methods scammers use to trick people into giving away money or personal information. They often try to make things seem urgent, secret, or too good to be true.

Being a Savvy Consumer

Tricks of the Trade and Common Frauds are methods scammers use to trick people into giving away money or personal information. Scammers often try to make things seem urgent, secret or too good to be true.

Never click a link in an email unless you specifically requested it - like when you reset a password. If you get an email with a link you didn’t ask for, especially from your bank, do NOT click it. Instead, call the number on the back of your bank card to check if the message is real. Scammers often send fake emails that look official, hoping you’ll click without thinking.

Businesses use advertising to convince you to buy as many of their products as possible. But for your own financial health, you should only buy what you actually need - not everything a company tries to sell you.

Common frauds are scams criminals use to steal your money or your identity. They’re called ‘common’ because they work often enough that scammers keep trying them. Remember: if something sounds too good to be true, it probably is.

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Insurance is a financial safety net you pay for so that if something goes wrong, like an accident, you don’t have to pay for the full cost yourself. You make regular payments called premiums, and in return, the insurance company helps cover the expenses if something happens.

Being a Savvy Consumer

Insurance is a financial safety net you pay for so that if something goes wrong - like an accident, theft, or damage - you don’t have to pay the full cost yourself. You make regular payments call premiums, and in return, the insurance company helps cover the expenses if something happens.

Life is already expensive without have to suddenly pay for extended medical care or replace possessions that are stolen or damaged - especially when those items are costly and might not be fully paid off yet. Insurance protects us against that unexpected. It helps reduce the financial impact of accidents, emergencies, and losses.

People commonly insure things that would be difficult or expensive to replace, such as:

Car Insurance: covers accidents, injuries, and damage
Quad/Motorcycle/Boat Insurance: protects recreational vehicles
Home or Tenant’s Insurance: covers your house or apartment and your belongings
Life Insurance: provides financial support to your family when you pass away
Health Insurance: helps pay for dental, vision, prescriptions, and other medical costs
Valuable Insurance: protects jewelry, electronics, instruments, collections, and other expensive items’
Pet Insurance: helps cover vet bills for illnesses or injuries

Insurance doesn’t prevent bad things from happening, but it helps protect your finances when they do. It’s one of the most important tools for managing risk and staying prepared.

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Pay Yourself First is the best way to guarantee savings
A budget is a plan for your money, including income and fixed/variable expenses
Credit is a tool to be used wisely
There are many types of loans, and it is important to know the difference between your options
Lenders take your full financial history into account when deciding to give you money. Better history means better loans
Paying back money on time and in full is the best thing you can do for your credit
Everyone out there wants your money and information - protect it!

Review

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Thanks for joining me!