Code: 2.7.1 · Adults
Understands the implications of a credit commitment on future disposable income
Understands the Importance of assessing ability to repay before borrowing money
Understands the impact of compound interest on credit
Understands the importance of knowing how long the repayment period will be and whether it is fixed
Understands that the total cost credit may be higher than what implied only by the interest rate
Can differentiate between the use of credit to generate or increase future income or wealth and the use of credit for consumption
Uses credit only when necessary and after considering the consequences
Assesses the total cost of credit and the likelihood of being able to pay it back before making any decision to borrow money
Makes decisions to borrow and manages any credit commitments within a budget
Takes into account the cost of credit as well as the cost of the item when making a decision to buy an item on credit
Takes into account the potential to generate or increase future income or wealth when deciding whether to borrow
Motivated to consider the consequences of accessing credit before making a decision
Motivated to seek alternatives to borrowing (such as saving, leasing, joint ownership, social support etc…)