Tania Madigan, who helps people with loans at Lakeshore Motors, recognizes immediately the value in teaching young people about budgeting and not being late with payments involving credit cards. Madigan says the difference between someone with good credit versus bad credit makes a big difference in the amount of interest they pay when applying for a loan. In some cases the person with bad credit could face rates as high as 29 percent compared to people who pay their bills on time and only face interest rates of a few points. Madigan was reacting to the provincial government’s decision to introduce financial literacy to Grade 10 students beginning next September. The program is slightly different from what Nipissing MPP Vic Fedeli had proposed last year but still contains many essential elements the Tory finance critic was after.
The Grade 10 curriculum will be readjusted to include the financial literacy program and Madigan hopes teachers turn to people like her to talk to students as guest speakers about things to watch for. Madigan is no stranger talking to students about financial literacy. She talked to a group of them in the career class at Widdifield Secondary School and said it was “astounding”. Madigan says some of the kids got what she was talking about because she could see the lightbulbs going off as she talked about the dangers of being late with credit card payments. “If this is part of classroom instruction once a week, it’s going to sink in,” she said.
In her 22 years of selling cars, Madigan has seen people of all ages apply for loans with some paying very high interest rates because of a bad credit history. She says it doesn’t have to be like this. “If they just had someone teach them when they were 16 or 17 on how to use things like credit cards, they wouldn’t face exorbitant interest rates on loans as small as $4,000 and $5,000” she said. Madigan speaks from personal history. She admits that when she was in her early 20s and had a credit card, she didn’t understand the importance of not missing payments. But she was late with her payments and paid the price with higher interest rates when she applied for loans. Madigan is confident that the Grade 10 financial literacy program will help some students avoid this very scenario when they get their first credit card in later years.