New words for this lesson
Say them out loud. Then use one word in a sentence.
€1,000 now or €49 a month?
Same phone, two offers. Phone A: €1,000 today. Phone B: only €49 per month for 24 months.
🤔 Do the maths: what does Phone B really cost?
Show answer
€49 × 24 = €1,176. That is €176 more than Phone A — for the same phone.
The €176 is the price of not waiting. Sometimes that is worth it. But you can only decide if you know the number.
The total cost calculator
Type any offer you see in an advert. The calculator does one job: it shows the total cost.
€49 feels small. €1,176 does not.
🤔 Why do companies advertise the monthly payment instead of the total price?
Show answer
Because a small number is easier to say yes to. Your brain compares it to small things, not to the real total. We look at this trick again in Block 4 (Money & Your Brain).
🤔 The shop offers the same phone at €29 per month — but for 48 months. Better?
Show answer
€29 × 48 = €1,392. The monthly payment is smaller, the total is bigger, and you are tied for four years — probably longer than you keep the phone.
Rule: a longer period almost always means a lower monthly payment and a higher total cost.
Four things to look for
- The APR. One number that makes offers comparable, because it includes fees.
- "0% finance". Sometimes really 0% — sometimes with a fee, an insurance or a higher price.
- Late fees. One missed payment can cost more than a month of interest.
- Buy now, pay later. It feels like a payment option. It is a loan.
Zusatzwissen · extra knowledge
Why does APR exist? Two offers can look the same and cost very differently once fees are counted. In the EU, lenders must show an annual percentage rate so that you can compare offers with one number. It is not perfect — but it is the fastest comparison you have.