This episode’s vocabulary
Chip-and-pin device
noun — a machine that reads bank cards for payments. → Most supermarkets have chip-and-pin devices at the checkout.
Convenient
adjective — easy to use or suitable for your needs. → Online shopping is convenient because it saves time.
Wallet
noun — a small case for carrying money and cards. → He pulled some notes out of his wallet.
Privacy
noun — the state of being free from unwanted observation. → Social media can sometimes invade your privacy.
Technology fails
phrase — when machines or digital systems stop working. → If the technology fails, you can’t access your account.
Component
noun — a part of a larger machine or system. → The phone has many small electronic components.
Credit rating
noun — a score showing how reliable you are in paying back loans. → A good credit rating helps you get a mortgage.
Debt
noun — money you owe to someone. → She worked hard to pay off her student debt.
Interest
noun — extra money paid for borrowing money. → The loan has a 5% interest rate.
Difficulties
noun — problems or challenges. → He faced difficulties paying back the loan.
Delayed gratification
noun — waiting to get a reward instead of taking it immediately. → Saving money teaches children delayed gratification.
Self-control
noun — the ability to control your actions or feelings. → She showed self-control by not buying the expensive shoes.
Justified
adjective — having a good reason. → His decision to leave early was justified by the bad weather.
Comprehend
verb — to understand something. → Children slowly learn to comprehend the value of money.
Bills
noun — money you must pay for services like electricity, water, or rent. → He paid all his bills at the end of the month
Banknote
noun — paper money issued by a bank. → He paid with a 20-euro banknote.
Transaction
noun — an exchange of money for goods or services. → The bank records every transaction.
Savings account
noun — a bank account used for keeping money long-term. → She opened a savings account for her child.
Financial literacy
noun — knowledge of how money works. → Schools should teach financial literacy to teenagers.
Cashless society
noun — a system where all payments are made digitally. → Some countries are moving towards a cashless society.
Questions and answers
Rory, why do people rarely use cash now?
Well, these days it's just easier to pay by card, isn't it? Almost every shop has these chip-and-pin devices, and you just tap your card and you're good to go, really. It's so convenient to use over, like, just plastering around with a load of cash in your wallet or your back pocket.
Do you think it's a good thing that more people are using digital payments?
I don't really know. I suppose from the perspective of convenience, it's very handy. However, it makes it easier for your purchases to be tracked, which might lead to your privacy being invaded. And there's the question of what happens if the technology fails? Because then it's just a useless lump of metal and plastic components, isn't it?
What are the advantages and disadvantages of using credit cards?
Well, the most obvious advantage is that you can get what you want without having earned the money beforehand, and then you can pay it off later. And some credit companies operate reward schemes which give you discounts and other goodies. I think you can improve your credit rating too, provided you pay off the debt on time, obviously. And that brings us to the obvious downside - you need to pay off the debt with interest, so it could actually cost more than the original price. And, of course, you could potentially mess up your credit rating if you get into difficulties paying things off or paying the money back.
Is it good and necessary to teach children to save money?
In a stable economy, absolutely. The idea of delaying gratification and exercising self-control by saving money is, well, I think it's a transferable skill and a habit that works wonders elsewhere in life. And it develops your ability to focus and work over long periods while motivating yourself with a far-off reward. So that's quite good.
Should parents reward children with money?
It's certainly one option if they have access to it, though it's far from the only one. Assuming the reward is justified and it's not just giving them money for no reason, then I think it should be fine. You might say they could behave irresponsibly with it, but that's true of just about anything given as a reward.
When do children begin to comprehend the value of money?
Well, there are some adults who struggled with that concept, so clearly some children never do. In the main, though, I think when they start to learn about and understand how things are worked for and how the concept of numbers works, so probably from a very young age, they start doing things like playing house at that time and, well, to run a house you need to pay the bills, even in the context of play.