Navigating credit in the classroom
Kirsty's been doing it via a module, designed to help Kiwi kids understand the ins and outs of all things credit.
Delivered to more than 38,000 students in 1300 classes across the country, the module is a collaborative initiative between Equifax and the interactive financial literacy platform, Banqer.
Together with other modules like banking and insurance, the concept is simple; teach our tamariki how to be financially literate early on in life, and they’ll be better equipped for the real world.
We sat down with Kirsty to get the inside word on teaching credit in the classroom.
Q. Did any of your students know what a credit score was from the outset?
Kirsty: The general perception was that a credit score was when you get a credit card, and some students thought it was a score for doing paid jobs. I didn’t know much about credit scores before I started teaching the module…as a 34 year old woman, I only got a credit card three years ago and so a credit score is something I never really considered.
I had a group of year seven and eight students previously, who knew more about money than I did. They figured out how to make the most of their money, and they even taught their parents a thing or two. Parents love that students are interested in so many new words that become part of their everyday vocabulary e.g., credit score, loan, interest, mortgage.
Q. What were the most challenging concepts for students?
Kirsty: It takes time for students to understand the complexity of loans and the process of paying them back. Interest charged on loans was also a bit of shock to some but once they understood interest rates, they were quick to see what type of loan could potentially be the cheapest.
Understanding the relationship between their credit score and their financial behaviour was one of the most rewarding parts to teach. Seeing students improve or correct their behaviour and sometimes rebuild their credit history was great!! They also learned quickly when it came to borrowing…...knowing a lower credit score might mean they get trapped by high interest loans was a motivator.
Q. What was most relevant to real life situations?
Kirsty: The biggest thing students pick up on is that you need a good credit score to get a mortgage and buy a house and that translates to real life very easily. They’re aware of how important it is to save for a home and to avoid taking on too much debt.
Q. Do you think the credit module helps our young people better understand the value of money?
Kirsty: I think it’s critical to educate our young about credit if we’re to have future generations who are prepared for adulthood. It also helps if they understand the implications of their decisions. We had a couple of students give themselves Banqer money (not something they should do) and they had to create a presentation about what happens if you take money that’s not yours. A valuable lesson was learned.
Q. Ideally, it would be great for young Kiwis to be sharing their learnings at home as most of us didn’t have the benefit of financial literacy modules when we were growing up. Do you think that your students are going home and talking to their parents about what they've been doing in Banqer, and in some instances, teaching them the odd thing?
Kirsty: Absolutely – the benefits extend beyond the classroom and it’s great to hear students relating their discussions at home. One of my students related a story where he was able to show a parent how a good credit score could help secure a mortgage, whilst another was sharing knowledge with his brother about good credit being key to building a property portfolio.
I think that everyone involved with teaching and learning Banqer likely picks up something they didn’t know and/or shares with others. It’s those wider conversations that reinforce key concepts and impact on the financial decisions of our future generations.