📘 Part 3: Money and modern payment methods

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

Maria: Rory, why do people rarely use cash now?

Rory: 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.

Maria: Do you think it's a good thing that more people are using digital payments?

Rory: 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?

Maria: What are the advantages and disadvantages of using credit cards?

Rory: 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.

Maria: Is it good and necessary to teach children to save money?

Rory: 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.

Maria: Should parents reward children with money?

Rory: 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.

Maria: When do children begin to comprehend the value of money?

Rory: 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.

Discussion

Maria: People use cash or they don't use cash. They rarely use cash, like hardly ever, almost never. And actually, this is true in some countries, while in other countries, they prefer cash. It's easier to pay by card. Pay by card. Or like make a digital payment. Because these days people just use their smartphones, like, you just like tap your smartphone…

Rory: …and Bob’s your uncle.

Maria: Say goodbye to your money, flying away from your account. Bye-bye. As easy as this. And every shop, usually every shop, has pin devices, these special chips, and you just tap your card. So, you tap your card or you tap your phone. So, it's convenient. You don't say comfortable, you say convenient. And it's more convenient than plastering around with a lot of cash. So, when you plaster around, it's an interesting phrasal verb, plaster around. Well, we don't even have it in the Cambridge Online Dictionary. It's so sophisticated.

Rory: You mess around with it. Faffing around. That's my favourite one.

Maria: Yeah, faff around is the top one in our course on phrasal verbs. So, yeah, like using cards is more convenient than faffing around with cash or plastering around with a load of cash, lots of cash. Because the cash should be in your wallet, in this special thing where you put money, or in your back pocket. It could be inconvenient. So, not convenient to carry around a lot of cash on you. Many people are using digital payments or many people are making digital payments. Like, it's a trend these days. Again, it depends on the country, but usually people use digital payments. And again, it's convenient. So, because of convenience, it's very handy.

Rory: It's helpful, like our podcast.

Maria: To make purchases. So, you purchase something, you buy something, or you make purchases. And your purchases could be tracked online. So, if you make a digital payment, your purchases can be tracked online.

Rory: I think they can anyway.

Maria: And you don't need any cards. So, you can have a digital card. Now, who needs these cards anyway?

Rory: Me. I'm old and I need them.

Maria: Really? So, you don't tap your phone when you pay?

Rory: No, no.

Maria: You use cards or cash?

Rory: I just use my card.

Maria: I just carry my phone with me. A credit card is different from a regular card. Because we talk about, like, credits, like loans. So, you kind of take money from a bank, and then you have to pay it off. Yeah, so you can get what you want without having earned the money. Present perfect. So, you haven't earned the money, but you can spend the money. It's amazing. Like, you can spend the money you haven't earned yet.

Rory: I mean, I don't think it's amazing. I think that's insane. But other people think it's a great idea.

Maria: Yeah. And then you pay it off later. So, when you earn the money, you pay it off. And you might have some discounts for using this system. But you have to pay off the debt on time. You have a debt. But we don't say B. Debt. So, you pay off this money or you pay off the debt to the bank. You have to pay it off. And usually you need to pay off the debt with interest. And, Rory, tell us what this interest is all about.

Rory: Oh, my God. Well, interest is basically a charge that is raised against you for borrowing the money. So, it's like the price that you pay for borrowing the money on top of the money that you already borrowed. Some places have interest-free loans. So, you don't pay this. But I think for a lot of it, you actually do. But this is why I don't deal with debt or anything like that. Because it's too complex for me. And I don't like it.

Maria: Yeah. And people might have difficulties paying things off. The interest rates could be quite high. And the cost will be more than the original price.

Rory: Or greater.

Maria: Children should be taught financial literacy. So, when we talk about teaching children about money, saving money. So, we talk about financial literacy. And, Rory, can I say, like, teach financial literacy? Or study financial literacy? Like, what's the phrase?

Rory: We learn about it if we're students. And we teach financial literacy if we're teachers.

Maria: And we should teach our children to exercise self-control. So, to control themselves by saving money. And this is a habit that could be transferred to other life areas. So, this skill is transferable. Transferable.

Rory: Yeah, it just means that you can use it in different situations.

Maria: It develops your ability to focus. So, when we teach children to save money, they are more able to focus. They work over long periods of time. You can say that it's important to foster financial independence. To kind of encourage financial independence in children. It's important to foster financial literacy. Foster, again, like, encourage students to learn about finances. And we can teach our children the value of money.

Rory: Or how important it is.

Maria: Yeah, like, how important money is. And how to spend money. How to earn money. How to spend money wisely. Okay. So, we can teach them how to save money. And we can teach them how to invest money. Yeah, there are, like, different courses for teenagers, for example. On how to invest money. How to make money out of money. I think that's great.

Rory: I think that's mental. But that's just me.

Maria: Why? Because, like, teenagers learn how to invest. They buy shares and stocks and kind of... They start doing it at an early age.

Rory: No, no, just the concept of doing the whole thing. I don't know. I think that's a bit shady. But that's just me.

Maria: However, people with more money than me do it. So, maybe I'm wrong.

Rory: Also, we can teach our children to set a budget. So, how the budget should be organised. Parents usually reward children with money.

Maria: Well, we can.

Rory: Not, kind of usually. Some parents. Yeah, they can. And parents give money as a reward for something. And this is one option of rewarding children. And the reward should be justified. So, if it's justified. If it's like, yes, they've won this competition. So, they get a lot of money. Well, it's justified. But if parents just give children money for no reason. Rory disagrees with it.

Maria: I don't think it's a very good idea.

Rory: Comprehend the value of money. Comprehend means to understand something completely. So, comprehend the value of money. Comprehend the importance of money. Maria: Understand the importance of money. Some adults struggle to understand the value of money.

Rory: I was just thinking this. When you asked the question, I was like, some adults don't do this very well.

Maria: Yeah, kind of like, what's the value of money?

Rory: What is the value of money indeed?

Maria: The value of money is a concept that recognises money available today is worth more than the same amount in the future. Huh?

Rory: Maria's brain has just exploded. See, this is how I feel about the whole thing.

Maria: Oh, okay, so kind of like, the money you have today is worth more than...

Rory: Than it was before. Or the item you have today.

Maria: Oh, dear listener, how are you doing? Are you okay? Good. So, you can say that adults find it difficult.

Rory: We are finding it very difficult right now.

Maria: Adults struggle to understand this concept, the value of money. Maybe the examiner has no idea what the value of money is. So, yeah, children, like, we've been talking about what children can learn. And you can say, yeah, it's a good idea to start doing some financial literacy. Hopefully, they will teach it at school.

Rory: Hopefully.

Maria: And from a very young age. And children should be taught things like paying the bills.

Rory: Or how to pay the bills.

Maria: Come on, children, yeah, these are the bills you have to pay. Go, off you go.

Rory: You will have to pay eventually.

Maria: Yeah, go play with the bills. Yeah, but children could be introduced to the idea of paying the bills or paying for the house they live in. Right, dear listener. Please remember that an investment in your knowledge pays the best interest. So, if you pay for your knowledge, if you invest money in your learning, education, you will be much wealthier than you are now. So, yes, buy our course on phrasal verbs, obviously. The link is in the description. Invest in your learning and education. Thank you so much. We love you. We hug you. Bye.

Rory: Bye.

Make sure to subscribe to our social media to see some of the “behind the scenes” stuff:

Our Instagram: bit.ly/instagramswi

Our Telegram: bit.ly/telegramswi