TOPIC:

Establishing a Credit Rating

RESOURCES NEEDED:

No specific requirements

LEARNING OPPORTUNITY:

Children need to learn the importance of trust. It will earn friendships and responsibility. In the future it will help them establish a credit rating which will provide opportunities not available to all people. By being responsible, honest, and trustworthy, they will earn a reputation allowing others to place confidence in them and give them freedoms to pursue opportunities. As such, focusing on those actions and insights towards building a solid reputation is a valuable activity for children.

THE ACTIVITY:

• Begin by asking the children to identify something they have which is of great value to them.
• Ask if they would lend that item to anyone.
• Ask if they would lend that object to someone special.
• Get their reasons in support of their answers.
• Have them explain why they would lend to some people and not to others.
• Ask if they can explain what it means to trust someone.
• Have them explain what makes them trust that person.
• Explain the importance of behaving in such a way as to have other people trust in them enough so that they (the other people) would be willing to lend them things.
• Explain that when they get older this will be similar to a credit rating – a rating that is high enough that people will lend you things. Provide an example – such as a loan or a mortgage.
• Explain that, when they get older, a good credit rating is very important and is measured by the following three things:
  1. Character – being trustworthy and a good person.
  2. Capital – owning things that could be given up if they did not repay money they borrowed.
  3. Capacity – having a way of paying things back – for example, having a job that would allow them to pay back the money they borrowed.

FOLLOW UP IDEAS:

• Discuss with the children how to tell if someone is trustworthy.
• Play a game that involves establishing trust.
• Discuss the pros and cons of borrowing and lending.
• Discuss the old saying “Neither a borrower nor a lender be” and what it suggests and why.

WEBSITES:

• Teach Your Child to Be Trustworthy
  http://www.teachkidshow.com/teach-your-child-to-be-trustworthy/