Making Sense of Finance – A Guide for Grade 12 Maths Lit Learners

Admin
Jul 26
2 min read

Let’s talk about something that affects every one of us — money.

Not just how to spend it, but how to budget, save, borrow wisely, and plan for the future.

In Maths Lit, the Finance topic is more than just formulas — it’s about learning real-life skills that will help you after matric, whether you’re earning, studying, or both.

Let’s break it down step-by-step, and I’ll walk with you through it.

📘 What You Need to Know in Finance

💳 1. Income and Expenditure

Income: Money coming in (salary, wages, grant, interest)
Expenditure: Money going out (rent, food, transport, school fees)
Learn how to calculate:
- Total income
- Total expenses
- Profit or loss

📊 2. Budgeting

A budget is a plan for how you spend your money each month
In exams, you may be given a table or pie chart
Be able to:✅ Interpret budget tables✅ Calculate shortfall/surplus✅ Suggest ways to save

🏦 3. Interest Calculations

Simple Interest:

I = P × r × tWhere:I = interest, P = principal (amount borrowed/invested),r = interest rate per year, t = time in years

Compound Interest:

A = P × (1 + r)ᵗIt earns "interest on interest" — grows faster over timeCommon in loans, savings, and investments

💸 4. Credit, Loans & Hire Purchase

Credit = buy now, pay later
Loans have interest and sometimes initiation/admin fees
Know how to:✅ Compare total repayment vs cash price✅ Calculate monthly instalments✅ Identify hidden costs

📈 5. Exchange Rates

Know how to convert between rands and foreign currencies
Example: R1 = $0.06✅ If you have R1000, how many dollars will you get?✅ If something costs $300, how much is it in rands?

🧾 6. Tax and Deductions

Understand PAYE, UIF, and net vs gross income
Example:
- Gross income: R12 000
- Deductions: R2 000
- Net income = R10 000

🧠 Exam Tips for Finance:

✅ Show all steps and units (e.g., R, %, years)

✅ Always round money to 2 decimal places unless told otherwise

✅ Use your calculator correctly for compound interest

✅ Check whether interest is per month or per year

✅ Read questions carefully — especially real-life scenarios (bills, payslips, bank statements)

🌱 Why It Matters

This isn’t just about passing Grade 12 — it’s about financial freedom.

When you understand finance, you can:

Avoid debt traps
Make better choices with money
Help your family and community
Start saving for your dreams early

Knowledge is power — and financial knowledge is survival.