Financial fluency. Mastering money talk, taxes, and essential English vocabulary

Financial fluency. Mastering money talk, taxes, and essential English vocabulary

Money is a universal interest, yet discussing financial matters isn't second nature to everyone. As an EFL/ESL teacher, you have the unique opportunity to bridge this gap. Equip your students with the necessary English financial vocabulary and create a nurturing classroom environment where they can freely practice their communication skills without the fear of making mistakes.


Understanding finance is particularly crucial for those immigrating to an English-speaking country. It's not uncommon for newcomers to be baffled by terms like 'gross income' during job interviews. Moreover, the realization that their actual take-home pay is significantly less than the 'gross' figure due to taxes can be quite a revelation.

Start of the lesson

Kick off your lesson with a brainstorming session to gauge what your students already know about finance. Start the discussion with these questions:

  1. Does anyone know what 'gross income' is?
    If no answers are forthcoming, provide the definition yourself.
  2. Can anyone define 'net income'?
  3. What are the key differences between gross and net income?
  4. Do you pay taxes?
    Offer additional explanation about 'taxes' if needed.
  5. How much in taxes do you pay?
    For example: Is it 5% of the gross income, or perhaps 30% of the net income?
  6. Does the tax percentage vary depending on the income level?
  7. Are there tax brackets in your country?
    Provide further explanation if required.
  8. What are some common tax deductions people can claim to reduce their taxable income?
⏰ It's time!

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Intend resolutely

Learning English financial vocabulary

Once the students are engaged and have grasped the basic concept of the lesson, introduce them to the related vocabulary and examples. This methodical approach ensures that your students not only learn about finance in English but also feel confident in discussing it.

Budget: An estimate of income and expenditure for a set period.
Example: Creating a monthly budget helps in managing expenses.

Net Income: The amount of money left after all deductions are made.
Example: Her net income was lower due to increased tax rates.

Gross Income: Total income earned before any deductions.
Example: His gross income includes his salary and freelance earnings.

Tax Return: The form used to report income and taxes owed to the government.
Example: I filed my tax return before the April deadline.

Revenue: Income generated from business activities.
Example: The company's revenue increased after launching the new product.

Savings: Money that is saved, typically in a bank.
Example: I put 20% of my paycheck into savings every month.

Investment: Allocating money with the expectation of generating income or Prot.
Example: She made a significant investment in stocks.

Debt: Money owed to another party.
Example: He took on debt to finance his education.

Interest: The cost of borrowing money or the earnings from lending money.
Example: The interest rate on my savings account is 2%.

Loan: Money borrowed that is expected to be paid back with interest.
Example: They took out a loan to buy a house.

Mortgage: A loan taken out to buy property or land.
Example: Their mortgage payments are due monthly.

Credit Score: A numerical expression based on credit history, indicating the creditworthiness of an individual.
Example: A high credit score allowed her to get favorable loan terms.

Asset: Anything of value or a resource of value that can be converted into cash.
Example: Real estate properties are considered valuable assets.

Liability: A financial obligation or debt.
Example: Unpaid loans are counted as liabilities.

Expense: The cost required for something or the money spent on something.
Example: Monthly utilities are a regular expense.

Bankruptcy: A legal status of a person or entity that cannot repay debts to creditors.
Example: The company declared bankruptcy after failing to repay its debts.

Equity: The value of shares issued by a company.
Example: He owns 15% equity in the startup.

Inflation: The rate at which the general level of prices for goods and services is increasing over time, leading to a decrease in purchasing power.
Example: Inflation caused the cost of groceries to increase.

Dividend: A sum of money paid regularly by a company to its shareholders out of its Prots.
Example: She received quarterly dividends from her stock investments.

Capital Gains: The Prot earned from the sale of an asset that has increased in value.
Example: He made substantial capital gains from selling his real estate property.

To Be in the Red: To have a negative balance or owe money, often in a bank account or business operation.
Example: After several poor financial decisions, the company found itself in the red.

To Be in the Black: To be Protable or financially solvent, not owing any money.
Example: Thanks to increased sales, the business is now in the black.

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