Debt That Helps and Debt That Traps
Some borrowing can help you, and some just piles up.
The idea
Debt means you borrowed money and have to pay it back, almost always with extra on top called interest. Some borrowing may help you, like a loan for training or a modest car that gets you to work, because it can buy something that lasts or helps you earn. Other borrowing pays for things that are used up fast and charges a high rate, so the payments can follow you around long after the fun is over. A useful test is: what does the borrowing cost, and is anything still worth something once you finish paying? ⚖️
Words to know
- Debt
- Money you borrowed and have to pay back.
- Interest
- The extra you pay on top for borrowing money.
- Interest rate
- How much extra you pay each year, shown as a percent.
- Minimum payment
- The smallest amount a credit card lets you pay that month.
- Credit card
- A card that lets you buy now and pay the bank back later.
Try it — no account needed
Not all borrowing is the same. Some may help you later, some just piles up.
Sort each one: debt that may help, or debt that can trap you?
0 / 6 sorted
In the full lesson
- 1Sort into groups
- 2Put it in order
- 3Make the call
Vine has 107 lessons like this one, each written three ways so a 7-year-old and a 17-year-old both get a version that fits.
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