The Real Cost of Buying Now and Paying Later · seed 1 · A4, ink-friendly. The answer key prints on its own page for grown-ups.

Count the full price of credit

Life Skills · Money & Finance · ages 15-16
Name ______________________   Date ____________

  1. What does an annual interest rate mean?

    • A one-off discount at the till
    • The yearly charge on money still owed
    • A reward for paying late

  2. How do you judge what a credit deal really costs?

    • By its total repaid across all months
    • By its monthly figure only
    • By how shiny the advert looks

  3. Paying only the minimum each month clears a card balance quickly.

    Circle one:   True   False

  4. A 500 balance sits unpaid for a year near 20 percent. About how much interest grows?

    • About 5
    • Nothing at all
    • About 100

  5. A speaker costs 25 a month for 18 months. What is the total repaid?

    Answer: ______________

  6. A phone is 300 cash or 20 a month for 18 months. Which costs more overall?

    • Cash at 300
    • Credit at 360 in total
    • Both cost exactly the same

  7. Two card debts drag on at minimums. What cuts the total fastest?

    • Overpay the costliest balance first
    • Pay minimums on both forever
    • Borrow more to cover the minimums

  8. A 200 jacket is four payments of 55 or a card cleared over a year with 40 interest. Which costs more?

    • The four payments, totalling 220
    • The card path, totalling 240
    • Both total exactly 200
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Answer key

For grown-ups. Fold this page away before handing over the rest.

Count the full price of credit W1-mt_VidrDsqJqA-s1

  1. The yearly charge on money still owed · Each month you pay interest on whatever balance is still left.
  2. By its total repaid across all months · Monthlies show today. The total shows the true price of buying now and paying later.
  3. False · Minimums cover mostly interest, so the balance barely moves.
  4. About 100 · A fifth of 500 is about 100, even with no new spending.
  5. 450 · Multiply the monthly amount by the number of months.
  6. Credit at 360 in total · 20 times 18 is 360, so the gap of 60 is the true cost of paying later.
  7. Overpay the costliest balance first · Extra money above the minimum cuts the balance faster, which cuts interest and time.
  8. The card path, totalling 240 · Four times 55 is 220, but 200 plus 40 interest is 240, so the card costs more.
Worksheet · LightMySky