Managing Money

Essential Spending - Something you need e.g. rent/mortgage/food etc.

Non - Essential Spending - Something you choose to buy e.g. CDs/games/smart phones/fashionable clothing etc. 

Debit Cards - Allows you to pay for goods electronically.

Pros:

• Do not have to carry money around
• Can only spend money in your account

Cons:

• Risk of online fraud
• Theft of card number etc

Credit Card - Allows for spending of money which is 'loaned' to you.

Pros:

• Can pay for larger more expensive items
• Can be cheaper than borrowing

Cons:

• The interest can be very large e.g. for each £100 you spend, you have to pay back £120 etc.
• Temping to 'max' out on card

- Interest free credit = You pay in instalments e.g. buying a sofa from DFS paying a certain amount each month.

- Hire Purchase = Paying for a big item e.g. a car - you pay % interest on the total amount.

- Subscription = Paying for a service every month e.g. Union rates, magazines etc.