📘 Part 3: Money and Financial Literacy

This episode's vocabulary

• Commonplace (adj.) - happening often or often seen or experienced and so not considered to be special.
• Contactless (adj.) - relating to the use of wireless technology to make a payment using a credit card or debit card, or a mobile phone.
• To tap (verb) - to hit something gently, and often repeatedly, especially making short, sharp noises.
• To faff around (phrasal verb) - ​to spend time doing things in a way that is not well organized and that does not achieve much.
• Hard cash (noun) - money in the form of coins or notes but not a cheque or a credit card.
• Necessity (noun) - the need for something.
• To rack something up (phrasal verb) - to increase something such as rent or price, especially by an amount that is considered to be too much.
• Debt (noun) - something, especially money, that is owed to someone else, or the state of owing something.
• To incur (verb) - to experience something, usually something unpleasant, as a result of actions you have taken.
• Interest (noun) - money that is charged by a bank or other financial organization for borrowing money.
• Streamlined (adj.) - improved or made simpler.
• Commensurate (adj.) - in a correct and suitable amount compared to something else.
• Consumerism (noun) - the state of an advanced industrial society in which a lot of goods are bought and sold.
• Detached (adj.) - separated.
• Cutoff (noun) - a fixed point or level at which you stop including people or things.
• Willy-nilly (adverb) - without any order.
• Detrimental (adj.) - causing harm or damage.
• Sensible (adj.) - based on or acting on good judgment and practical ideas or understanding.

Questions and Answers

M: Why do people rarely use cash now?

R: Well, lots of reasons. I mean, it became commonplace in the pandemic, but even before that, contactless payments were on the rise. It's just easier to tap your card and forget about it, rather than faff around with some wad of notes. Some businesses also no longer accept hard cash, so it's become something of a necessity to carry cards around as well.

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

R: Well, like I said when we were talking about cards in general, they're easy to use, and some of them even provide you with rewards for using them. On the other hand, of course, you could rack up a lot of debt very easily if you don't pay the money back on time and then incur a lot of interest.

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

R: Well, I can certainly see why it might be. Payments are more streamlined and people can buy things more easily, but that's resulted in a commensurate rise in consumerism, and I don't think that's good for people if they just become invested in things all the time and detached from their reality.

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

R: Well, there's some adults who don't do this, so I'm not sure there's like a hard and fast established cutoff point or stage when this realization happens, which makes sense when you consider money is something we've totally made up. I had to pick an age bracket, though, probably just before they're teenagers. And they can see and understand how payments are made and the work involved, but that's just a guess.

M: Is it necessary to teach children to save money?

R: Oh, yes, I'm not sure children would come to this conclusion otherwise if adults didn't show them. So it's definitely needed. As to whether it's a good thing, you'd have to show them how to do it responsibly. Just saving willy-nilly with detrimental consequences for your relationships isn't likely to do much good in the long run, is it?

M: Should parents reward children with money?

R: Well, it's like with saving, really, provided it's done in a responsible manner. I honestly can't see the issue with it. They would need to make sure that it's of sensible amount, and that some restrictions are in place to help them learn about what they can do with it. But I don't see why it would be a big thing or a negative thing in general.

M: Hey! Thank you, Rory, for your answers!

R: My rich answers. Rich in grammar and vocabulary.

Discussion

M: Dear listener, once again, make sure you use money accurately. A money. No, no, no. He gave me money. Money is important. Money is it. Like it is invested. I need it. Money, okay? Not moneys. Money, money, money. Is and it. We can say the money that people earn or make. People use cash. And these days, people don't often use cash, and it has become common in the pandemic. So it's commonplace. It was commonplace in the pandemic not to use cash. Or do we say, like pay in cash, or pay by cash?

R: Um, both, because one of them is the mechanism. And you make the payment through something. But paying cash means you just give the cash, like the physical thing.

M: Contactless payments, dear listener.

R: That's when you take your card and you tap it onto a machine or someone's phone.

M: Yeah. So you tap your card. Tap. Like...

R: Is that the sound?

M: Yeah. Money's gone. Yeah, money is gone, you see, dear listener? So you don't faff around with coins and notes. Bank notes. So you just have your card or even just your phone. So faff around like mess with. And it's no longer a necessity to carry cards around. So you don't need to carry a physical card on you. You can use your smartphone or what... Yeah, or your smartphone. But if your smartphone is dead, or you've left your smartphone at home, that's it, dear listener. You can't do anything in this life. So there are different types of cards. Credit cards. What are they?

R: Well, credit cards are cards that you pay for things with using money that is not actually yours. So you create debt in order to pay something, whereas a debit card is something that extracts money that you own from an account where you keep this money.

M: Yeah. Dear listener, so you might use a credit card. Yeah? Or you might use debit cards. Or we can just usually say, like, okay, I pay with a card. So we kind of... Doesn't matter what kind of card it is. And if you use a credit card, you can rack up a lot of debt. Debt is what you owe to the bank. So I don't have this money, but I bought a very expensive phone, and now I am in debt. I have to pay it back. Okay? So rack up a lot of debt means to kind of, to...

R: To get into a lot of debt.

M: And you pay the money back, you have to pay the money back on time. And we call it interest. So when you don't pay the money back on time, the bank charges an interest rate. And it's the same when you take out a loan. Also, the bank charges you an interest rate. People are using digital payments. Okay? Or people make digital payments. Like contactless payments. So no contact, no paper money, no cash. So people can buy things more easily. But the disadvantages, like the drawbacks, you can say on the flip side, on the flip side, this resulted in something...

R: Commensurate.

M: Oh, a commensurate rise in consumerism.

R: Yes, but that just means something that happened at the same time. So as the use of something increased, so did something else which was also bad.

M: Commensurate. And usually, we use it like "commensurate" increase in something. Or rise, a commensurate rise in consumerism. So people buy, buy, buy, buy things all the time. And people who make digital payments, they might be detached from reality because they don't see real money. Like paper money. And everything could seem unreal. Everything is online, yeah? So they could be like separated from reality, detached from reality.

R: So they're not very aware.

M: Children should comprehend the value of money. Comprehend? Understand the value of money. And Rory here tells us that, like some adults don't understand the value of money.

R: Yeah. I love it. Like, why should children be expected to have this understanding when adults certainly don't behave that way?

M: What is a cutoff point?

R: A cutoff point is the part where something ends.

M: For example? Could you give us a sentence with this cutoff point?

R: Yeah, if you have too much credit card debt, then there might be a cutoff point where you have so much that your bank just says you can't use the card anymore because you don't pay it back.

M: And if you are using money online all the time, you pay for everything online, then kind of, you might think that money is something we have totally made up. So kind of it doesn't exist. We made it up. Again, money is something. But when do children should learn more about money? And Rory says if I had to pick an age bracket. Age bracket is an age group. Well, meaning like the age. If I had to give you the age, the exact age, the second conditional, if I had to pick if I had to choose. So if I had to pick an age bracket, this would probably be teenagers.

R: Or just before they're teenagers.

M: Because they understand how payments are made. So payments are made online, how payments are made. So we make a payment. We should teach children how to save money, or how to invest money, and how to manage money, dear listener. And this is our financial literacy. We should be financially literate. Like, if you are literate, you can read and write, and financial literacy is when you know how to manage your finances. I don't think it's taught at schools.

R: It is in part, but it's not... I think it's something most people consider to be a parent's responsibility.

M: Yeah, so like financial literacy is the ability to understand and effectively use various financial skills, including personal financial management, budgeting and investing. You can say that children should be financially literate. And there you go, you see, like wwwinvestapedia.com could give you the ultimate guide to financial literacy for adults.

R: Good. Everybody should have that.

M: And you can say that children should be educated on banking, budgeting, saving, credit, and debt. Not debt. No, no, no. Debt.

R: Even though there's a B in there. But you have a debit card, and that's not pronounced silently, so it's a hard one.

M: So adults should show children how to save up, how to save money. A very nice phrase is like willy-nilly. Rory, what does it mean?

R: It just means recklessly or with no real pattern.

M: Could you give us a sentence?

R: Well, you can spend money willy-nilly.

M: Like waste money. It's informal. And if something happens, willy nilly, it happens, even if the people do not want it to happen, like without any order. Like she threw her clothes willy-nilly into a drawer. You just throw clothes. So don't waste your money willy-nilly. Don't just save your money willy-nilly, because it could lead to some detrimental consequences. So like negative consequences, dear listener. Parents reward their children with money. So kind of they praise them. Well done you. You have a very good mark. So here you go, $100,000. So parents should do it in a responsible way. It should be a sensible amount. So kind of sensible, normal amount, and there should be some restrictions. So you should restrict how much money you give to children. Otherwise, they're going to spend it willy nillyWhy do people rarely use cash now? Yeah, dear listener, if you want to, you know, learn more about financial literacy, investopedia.com. We don't work with investopedia.com but they have a nice guide. Like what is financial literacy and beautiful words as well, like, oh, it can help you become self-sufficient and achieve financial stability. You see? Very good. Achieve, financial stability. Nice phrase. You can also use it in your essays, dear listener because in IELTS, many essays are about money. Or kind of your examples could be about money. Pay off debt, and plan for retirement. And somehow I have this BBC English voice now. Are you ready to plan for retirement? The importance of financial literacy. Is this how they speak on BBC World Service?

R: I think it's how they used to speak, but I don't think it's how they speak now.

M: Oh, no? Oh... Kind of dramatic, like making informed financial decisions is more important than ever. You see? It's good, you know, like good phrases. Yeah, dear listener, if it's difficult for you to talk about money, google financial literacy and this investopedia.com, is going to be one of the first choices. Yeah, read the article. This is your homework. And you can use it in speaking and writing. Okay? Investment vehicles. What investment vehicles are you using, Rory?

R: I don't know. You need to ask a person who I have in charge of that.

M: Nice. He delegated. Yeah, personal finance basics. Anyway, dear listener, thank you very much for listening! You have homework. Read through the ultimate guide to financial literacy on Investopedia.

R: But it will be a worthwhile investment in the end. Bye!

M: Bye!

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