Pretty Please? Borrowing Money
One way to get money is to borrow it. Adults borrow money often. An adult can go to a bank and apply for a loan. The bank looks to see if the person has a job, pays his bills on time, and is a good credit risk. If so, the bank loans the money. The loan is usually for a specific amount of time, such as five years or thirty years. The person borrowing the money must make monthly payments to the bank. These payments are used to repay the amount of the loan and to pay the interest the bank is charging. Adults often borrow money to buy homes and cars. A home loan is called a mortgage.
When an adult borrows money for a home or car, she agrees that if she doesn.t pay back the loan, the bank can take the home or the car. This is called repossession. Usually a bank will sell the home or car and use the money to pay off the rest of the loan.
You.ve probably borrowed money from your parents or friends. If there is a big purchase you want to make, such as hockey gear or cool new shoes, you could ask a parent if you could borrow the money. When you do this, create a plan so that your parent knows you are serious about paying it back. If you want to borrow $50, you could plan to pay back $5 a week. Your loan would be paid off in 10 weeks. Most parents don.t charge their kids interest, but a sibling or a friend might. Your brother might agree to lend you $20 if you pay him back $22 total. He would earn $2 in interest.
Brain Power: School Costs
Public schools are paid for by school taxes, which are paid by people who own property in the community your school is in. If you go to a private school, your parents must pay tuition for you to attend. The average cost of private school tuition is $12,500 a year. Even if you go to a public school, your education isn.t free. The average family spends about $500 on school supplies every year. Thinking about college? It can be a big expense. But, just like school now, it depends on what kind of college you go to. Public colleges are run by the state and cost much less than private colleges, which require students and their families to pay higher tuition. Right now the average cost of a private college is $23,700 a year. A public college averages $12,300 a year. College costs go up every year. Sounds like a lot of money, right? Maybe, but the U.S. Census Bureau says that a college degree can increase your lifetime income by $2 million. Sounds worth it for sure, wouldn.t you say? Although college does cost a lot, there are a lot of ways to make it more affordable. Many students get scholarships.money given to them by the school or other organizations as a reward for good grades. Lots of students borrow money from banks to pay for their college educations.
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