Financial Education
What is it?
- The Definition:
Financial Education refers to the set of skills and knowledge that allows an individual to make informed and effective choices with all of their financial resources.
- What is debt?
Debt is something we all have. It is only when that debt becomes unmanageable that it causes problems. If you have a low income, you are more likely to rely upon High Interest Credit to buy essential items such as a washing machine, cooker etc.
- What are we doing?
We will be arranging a number of Financial Education sessions throughout the coming year. We will also provide Thenue tenants with 1-2-1 sessions if requested.
- Why we are doing it?
Universal Credit
The introduction of Universal Credit and monthly payments can cause difficulties
with budgeting, especially if you are used to having being paid fortnightly. This
change often leads to more month than money. Firstly, there will be a 5 week period
when you do not have any money and the money you then receive has to last you a
further month.
That is why budgeting is important, to try and prevent you getting into financial difficulties.
- High Interest Credit
As mentioned earlier, people on low incomes rely on credit and this credit tends to be High Interest, such as Provident and Brighthouse. From experience we know that most low income households look at the weekly payments rather than the total cost.
- Why you should take part.
Do you want to try and stop yourself from getting into serious debt?
Do you want to feel confident in dealing with creditors?
Do you want to feel confident dealing with Sheriff Officers arriving at your door?
Let us help you to get that confidence.
The following are some examples of what will form part of the Financial Education sessions:
HERE ARE SOME EXAMPLES OF HIGH COST CREDIT.
This information was taken from the companies websites.
Firstly we will compare purchasing a cooker from Brighthouse against getting a loan from a Credit Union or Scotcash.
Companies such as Brighthouse may appear to be reasonable and affordable. Most people look at the weekly payment and do not realise the total cost of the item.
Let us look at an example from their website:
You are looking to purchase a cooker and you see in the Brighthouse window, they have one and it is only £8.75 per week. You say to yourself, I can afford that, so you think you should get it.
However the weekly price does not tell the whole story.
Weekly Payment £8.75
Price of cooker £591.88
Delivery and installation charge £95.00
Product price is now £686.88
Payment is for 156 weeks @ 69.9% APR
Total amount payable is £1365.00
That is quite a jump is it not?
If taking out a credit union Loan for this same cooker at another shop,
Let’s assume you will be charged the same for delivery and installation.
| 1. Loan Amount | £686.88 |
| 2. Payment Frequency | Weekly |
| 3. Interest Rate (APR) | Standard - 12% |
| Payment Amount | £5.25 |
| Number of Payments | 156 |
| Total Interest Amount | £131.83 |
Total cost of Credit Union loan is £828.71 saving you £546.28 against Brighthouse.
Scotcash
APR: 113.40%
Borrowing £700 with 52 weekly payments of £18.19
+
Admin* £42
+
Interest £245.29
=
Total to repay** £987.29
Saving £377.71 against Brighthouse
Doorstep Credit:
Lets look at the cost of borrowing £400.00 from Provident over 52 weeks.
The total amount payable is £749.00
Borrowing £400 from the credit Union paying over 52 weeks:
Total payable is £424.95.
Borrowing £400 from Scotcash paying over 52 weeks:
Total payable is £565.00
Budgeting:
Being able to budget is an important method of getting your finances in order.
You may feel that you do not have enough money to budget, but we all do it every day.
Want v Need
Here we look at the difference of what you want against what you need by showing you some everyday examples.
What is debt?
- Here we look at the meaning of debt
- How easy it is for you to get into debt
- How to tackle debt one step at a time.
- Looking at the various types of debt.
This is only a brief guide to what we will be presenting as part of the Financial Education sessions.
If you would like more information please contact us on
Tele: 0141-550-9553 or 0141-550-9554
Or by e-mail:
or