4.09 Debt and Wealth

Last updated 5 months ago

18 questions

Note from the author:

Instructions

4.09 Debt and Wealth

Last updated 5 months ago

18 questions

Note from the author:

Instructions

Do you think being successful means being debt-free? Why or why not?

EDPUZZLE: Is There Such a Thing as Good Debt? 📷10 min
Debt is personal and people’s opinions on debt range widely. Is debt the pathway to building wealth? Or is it a trap keeping you from wealth? Watch this video and follow your teacher's directions to answer the questions either in your student activity packet or within the EdPuzzle itself.

INFOGRAPHIC: What’s My Net Worth? 📷7 min
In the previous resource, you learned about how good debts and bad debts impact your wealth. One way to measure wealth is called net worth. Study the infographic to learn how to calculate your net worth. Then, answer the questions.

An asset is a resource that someone owns that has value, like furniture or a house that could be sold for money. How could debt help you build your assets?

Sakura owns her home, worth $411,000, and car, worth $14,000. She has $10,000 in student loans and owes $115,000 on her mortgage. Using the formula provided, calculate her net worth.
Assetts-Liabilities=Net Worth 
_______ 

VIDEO: Buy, Borrow, Die: How America's Ultrawealthy Stay That Way 📷5 min
Debt is a key part of wealth building for one particular group of Americans. Watch the video to learn how the wealthy use debt. Then, answer the questions.

In your own words, define each step of the “buy, borrow, die” strategy
Buy:_______ 
Borrow:_______ 
Die:_______ 

How does the “buy, borrow, die” strategy help the wealthy maintain and accumulate wealth?

Why does this strategy primarily work for people who are already wealthy?

Teacher Tip: Please note that the disruption of some agencies, like the CFPB, may impact this worksheet. (Feb 11, 2025)
Credit is a part of our lives and the decisions you make with credit have a big financial impact. So what protections do you have as a borrower? In this activity, you’ll become the expert on one specific credit protection law, and then share what you learned with your classmates.
Part I: Research Credit Protections
It’s time to dive in! Use the internet to research your specific credit protection law. Remember to use credible sources and cite them as you complete this section of the activity. To get started, consider searching on sites for government agencies, like the FTC, the CFPB, the OCC, or on reputable finance websites, like Investopedia or Nerdwallet.

Complete the chart on the following table for your assigned law.
Fair Credit Reporting Act
Fair Debt Collection Practices Act
The Truth in Lending Act
Credit CARD Act
The Equal Credit Opportunity Act
The Dodd-Frank Act
Follow your teachers’ instructions to share what you learned. As your classmates share, complete the remainder of the chart.

Which of the following is the best definition of a “bad debt”?
A debt with a low interest rate
A debt that decreases your credit score over time
A debt that decreases your net worth over time
A debt that is used to buy something that increases in value over time

Which equation best defines net worth?

All of the following are true about access to credit in the United States, EXCEPT…
Access to credit can make it easier to build wealth__________
Access to credit is equal across race and income level__________
There are laws against credit discrimination based on characteristics including race, age, and gender__________
There are laws requiring lenders to offer accurate credit information, like the interest rate and total cost of a loan__________

4.09 Debt and Wealth

4.09 Debt and Wealth

Do you think being successful means being debt-free? Why or why not?

EDPUZZLE: Is There Such a Thing as Good Debt? 📷10 min

INFOGRAPHIC: What’s My Net Worth? 📷7 min

An asset is a resource that someone owns that has value, like furniture or a house that could be sold for money. How could debt help you build your assets?

VIDEO: Buy, Borrow, Die: How America's Ultrawealthy Stay That Way 📷5 min

In your own words, define each step of the “buy, borrow, die” strategy

Buy:_______

Borrow:_______

Die:_______

How does the “buy, borrow, die” strategy help the wealthy maintain and accumulate wealth?

Why does this strategy primarily work for people who are already wealthy?

Part I: Research Credit Protections

Which of the following is the best definition of a “bad debt”?A debt with a low interest rateA debt that decreases your credit score over timeA debt that decreases your net worth over timeA debt that is used to buy something that increases in value over time

Which equation best defines net worth?

Do you think being successful means being debt-free? Why or why not?

EDPUZZLE: Is There Such a Thing as Good Debt? 📷10 min

Good debts are incurred for things that are expected to…

Summarize: What is the difference between how Robert Kiyosaki and Dave Ramsey approach debt?

How does buying something with debt tend to impact people's spending, compared to buying with cash?

According to the video, what TWO questions should you ask yourself when making decisions about debt?

INFOGRAPHIC: What’s My Net Worth? 📷7 min

An asset is a resource that someone owns that has value, like furniture or a house that could be sold for money. How could debt help you build your assets?

VIDEO: Buy, Borrow, Die: How America's Ultrawealthy Stay That Way 📷5 min

In your own words, define each step of the “buy, borrow, die” strategy

Buy:_______

Borrow:_______

Die:_______

How does the “buy, borrow, die” strategy help the wealthy maintain and accumulate wealth?

Why does this strategy primarily work for people who are already wealthy?

Part I: Research Credit Protections

This is a copy of the chart you will fill out on google docs. I filled in this chart. If I do not have a copy I will ask Mrs. Pariseau for a copy.

Choose one of the credit protections described above. Why is it important?

These laws largely work by allowing borrowers to file a report or lawsuit in response to violations. Do you think that is enough to prevent unfair credit practices? Why or why not?

Do you think there are any important protections are missing? Why or why not

Which of the following is the best definition of a “bad debt”?A debt with a low interest rateA debt that decreases your credit score over timeA debt that decreases your net worth over timeA debt that is used to buy something that increases in value over time

Which equation best defines net worth?

Good debts are incurred for things that are expected to…

Summarize: What is the difference between how Robert Kiyosaki and Dave Ramsey approach debt?

How does buying something with debt tend to impact people's spending, compared to buying with cash?

According to the video, what TWO questions should you ask yourself when making decisions about debt?

This is a copy of the chart you will fill out on google docs. I filled in this chart. If I do not have a copy I will ask Mrs. Pariseau for a copy.

Choose one of the credit protections described above. Why is it important?

These laws largely work by allowing borrowers to file a report or lawsuit in response to violations. Do you think that is enough to prevent unfair credit practices? Why or why not?

Do you think there are any important protections are missing? Why or why not

Which of the following is the best definition of a “bad debt”?
A debt with a low interest rate
A debt that decreases your credit score over time
A debt that decreases your net worth over time
A debt that is used to buy something that increases in value over time

This is a copy of the chart you will fill out on google docs.

I filled in this chart. If I do not have a copy I will ask Mrs. Pariseau for a copy.

Which of the following is the best definition of a “bad debt”?
A debt with a low interest rate
A debt that decreases your credit score over time
A debt that decreases your net worth over time
A debt that is used to buy something that increases in value over time

This is a copy of the chart you will fill out on google docs.

I filled in this chart. If I do not have a copy I will ask Mrs. Pariseau for a copy.