Module 4 – Lesson 2 – Loans and Interest
This is a 50-minute lesson (Module 4, Lesson 2 – Loans and Interest) from a financial capability/personal finance curriculum produced by The Ohio State University. It teaches students about the planned use of credit, consumer loan terminology, and signs of over indebtedness, using activities such as borrow cards, video discussion, math examples comparing loan vs. cash purchases, and an auto loan calculator exercise.
At a glance
- Learning objectives
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- As a result of this unit the student will understand and manage credit responsibly.
- Discuss elements in the planned use of credit.
- Define consumer loan terminology.
- Recognize signs of over indebtedness.
- Time required
- Instruction time for this lesson: 50 minutes. (Time is estimated and may vary depending on teaching style)
- Materials
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- M4.L2.TM.A – cut apart cards so that each student can have a card when entering the class
- M4.L2.TM.B
- M4.L2.TM.C
- M4.L2.TM.D
- M4.L2.TM.E – set of cards for each 3 students
- Computer with Internet access and projector
- M4.L2.AS.A – one per student
- M4.L2.AS.B – one per student
- Lesson Number
- M4.L2
- Key Concept
- Financial Capability
- Unit
- Module 4 – Credit
- Precepts
- C – Vision (C1. Contemplate the future); F – Continuous Improvement (F5. Acquire new knowledge)
- Key Terms
- Annual Percentage Rate (APR), Capacity, Capital, Character, Collateral, Cosigner, Credit, Debt, Finance charge, Financing, Fixed-rate loan, Grace period, Installment loan, Interest, Late fee, Loan term, Secured loan, Unsecured loan, Variable-rate loan
Downloads & Links
Lesson plan
Presentation
Aligned Standards
Jump$tart Coalition for Personal Financial Literacy National Standards – Financial Responsibility and Decision Making
- Standard 4Make financial decisions by systematically considering alternatives and consequences
Jump$tart Coalition for Personal Financial Literacy National Standards – Planning and Money Management
- Standard 3Describe how to use different payment methods.
National Standards
- NL-ENG.K-12.12Applying Language Skills
- NL-ENG.K-12.3Evaluation Strategies — Students apply a wide range of strategies to comprehend, interpret, evaluate, and appreciate texts.
- NL-ENG.K-12.4Communication Skills
- NSS-EC.9-12.12Interest Rates
National Standards (AFNR)
- ABS.04.01.02.c.Evaluate Characteristics of Lines of Credit, Loan Terms and Alternatives in Sources of Capital