Activity 2: Types of loans
1. Remind students that saving for something is a cheaper option than borrowing to buy something. If you do decide to borrow (either from a friend/family member or from a financial institution) the most important thing to do is to get informed about all the options available.
2. Explain to students that there are a range of types of loans available.
OPTIONAL LITERACY ACTIVITY: Depending on your class you might wish to divide the class into pairs and invite students to complete Student worksheet: Wordsearch as a way of pre-teaching relevant terminology related to different types of loans. Answers to this activity are provided in Teacher resource sheet: Wordsearch answers.
3. Write the following list on the white/blackboard: personal loans, credit union loans, overdraft, credit cards and hire purchase.
4. Ask students what they know about each of these types of loans.
Note: Depending on your class you may wish to provide some of the detail given in
Teacher resource sheet: Loans jargon buster.
5. Divide the class into small groups.
6. Distribute one copy of Student worksheet: Types of loans to each group.
7. Invite students to work together to decide what type of loan each individual on their worksheet either currently has or is looking for. Remind them that the types of loans are written on the white/blackboard.
8. Invite each group to correct their answers. The correct answers are:
(A) Claire = Overdraft; (B) Jack = Personal Loan; (C) Graham = Credit Card; (D) Mairin = Credit Union Loan; (E) Mark = Hire Purchase.
9. Conclude by writing the word ‘Pro’ and ‘Con’ on the white/blackboard and facilitating a whole class discussion about the perceived pros and cons of different types of loans.
