TOPIC:

Using a credit card

RESOURCES NEEDED:

A meal at a restaurant, a bill to pay, and a valid credit card for payment

LEARNING OPPORTUNITY:

It is important for teenagers to understand how a credit card is used and how to protect yourself when using it. It can also be fun for them to conduct the transaction while you are there to help them.

THE ACTIVITY:

• Plan a dinner out as a family. When the bill comes, talk about the importance of checking the bill since it is not uncommon for there to be mistakes. Note the taxes that are charged as well. Often the cost of a family meal is surprising to children and they are often unaware, or don’t think about, how much it costs when everything is added up. You might want to take this opportunity to talk about ways of keeping the cost down for a dinner when you eat out.
• Allow your child to use the credit card to pay the bill—keeping a watchful eye.
• Talk with them about how to determine the tip—either a percentage of the bill or a set amount. These options are often available on the machine used to process the credit card payment. Talk about whether a tip should be paid on the whole bill—or on the bill less taxes.
• As the transaction is being completed, talk with them about the importance of always keeping the credit card in view and maintaining privacy if a pin number is required. Talk with them about keeping the receipt and credit card slip. This can be a time to talk about the importance of record-keeping and holding on to receipts as a record of payment—and a way to track expenses at the end of the month. Talk about the importance of not throwing credit card receipts away as others could retrieve them and take your personal information and also be able to copy your signature.

TIPS:

• Talk about the value of having a budget and working within in.
• Talk about how using a credit card, and paying off the bill in full each month, can provide a record of your spending.
• Talk about the possible “points” that can be accumulated by using a credit card that can help with purchases, trips, etc.
• Talk about the value of a credit card, when used wisely, in that you don’t have to carry cash that can be lost or stolen.

FOLLOW UP IDEAS:

• Discuss with them the various types of credit cards and even examine some types to see what charges etc. are associated with each.

WEBSITES:

• 8 lessons to teach your child about credit cards – http://credit.about.com/od/creditcardbasics/a/Lessons-To-Teach-Your-Child-About-Credit-Cards.htm
• Borrowing money and using credit – https://moneyandyouth.com/modules/borrowing-money/
• How credit cards work – http://www.getsmarteraboutmoney.ca/en/managing-your-money/planning/managing-debt/Pages/How-credit-cards-work.aspx
• Credit cards – http://www.fcac-acfc.gc.ca/eng/consumers/creditcard/index-eng.asp