Financial Literacy

Activity Details

Time needed: 60 minutes

Materials needed: 

• Paper
• Pen or pencil
• Computer, tablet, or smartphone for internet research

Setup:  Knowing how to create and stick to a budget is a skill that will help you throughout every stage of your life. Before you can begin to create a budget for your future, you’ll need to imagine where you will live. When you live on your own, your biggest expense will likely be your housing. Living in a dorm, renting an apartment, and buying a house all have their own financial rules and regulations. 

Activity: Look at a map of the area you’d like to live, whether it’s the freshman dorms at your college of choice or renting in a neighborhood you’d like to live in one day. Then, do research on at least six available rooms or homes to find out how living expenses differ and what kinds of compromises you might have to make. For example, when renting in a college town or a big city, you’ll likely have to pay more, but living right outside of a city could mean a bigger place with more room. Think about how much money you might need to set aside for renting or buying a home. Make a chart comparing the various costs and trade-offs you’ve discovered. Create columns for location, type of housing, size of housing, amenities (parking, pool, close to public transportation), cost to rent per month, or cost to own with monthly mortgage payments. Then, make sure you have enough rows for at least six listings. If you have time, consider making multiple charts for different budget levels and different locations so you can compare these costs and trade-offs from multiple perspectives.

Take this activity a step further by doing this research with a group of friends. Have each friend pick a different city or neighborhood and then share what you find and compare costs.

Here are some terms that will help you along the way:

• Down payment: When you buy a home, the financial institution lending you the money for the purchase will typically require a percentage of the purchase price to be paid in cash as a down payment. This amount is often at least 20 percent of the purchase price. 

• First and last months’ rent: If you’re renting, your landlord will often require you to pay the rental fee for both the first month and the last month of a lease up front. Being paid for the last month’s rent at the beginning of the lease is insurance for the landlord in case the renter fails to pay regularly or moves before the lease expires. 

• Security deposit: Many landlords require renters to pay a certain amount of money up front in case the renter damages the apartment or fails to pay rent regularly. If the renter meets all obligations (paying rent on time, keeping the apartment in good shape) the money paid for a security deposit is returned at the end of the lease. In some cases, the last month’s rent, mentioned above, is used as a security deposit.

• Mortgage fee: When a bank or other financial institution lends someone money to purchase a house or condo, a monthly fee, or mortgage fee, is required to pay back both the principal (amount borrowed) and interest on the loan. 

Share your research with your family and friends and get their thoughts!

Troop Leaders:  The instructions for all badge steps are available free of charge in your  Girl Scout Volunteer Toolkit.

Girl Scouts at Home activities have been adapted from existing Girl Scout programming and optimized for use at home during a period of social distancing.

Adapted from Step 1 of the Ambassador On My Own badge. Purchase the Ambassador Girl Guide's to Girl Scouting to complete all requirements needed to earn the badge.