Students use a simple formula to calculate the true cost of items bought with a credit card.
Topic
Borrow (Managing credit)
Subject
CTE (Career and technical education), Math, Social studies or history
Grade Level
Middle school (6-8)
Duration
45-60 minutes
Big idea
When you don’t pay off the full amount that you owe on a credit card, you’ll have to pay interest on the money you still owe.
Essential questions
- How do interest rates affect credit card payments?
- How do you calculate the cost of a purchase including interest?
Objectives
- Learn about making informed choices about credit offers
- Calculate payments for credit card purchases based on the principal and interest rate
What students will do
- Calculate and analyze how monthly payments on a credit card change based on the principal and interest rate.
- Reflect on ways to reduce the amount owed on a credit card.
Download activity
Teacher guide
cfpb_building_block_activities_managing-credit-card-payments_guide.pdf
Student materials
cfpb_building_block_activities_managing-credit-card-payments_worksheet.pdf
Note: Please remember to consider your students’ accommodations and special needs to ensure that all students are able to participate in a meaningful way.
