Curriculum / Financial Literacy / module 3

How Interest Works: For You and Against You

By OSH Founding Team✓ Verified by OSH Review Panel

Compound growth demonstrated with beans on a grid: the learner watches saving snowball and debt swallow, and examines it from an Islamic finance lens too.

Parent guide (what to say and do)

Model it physically. Grid one: 100 beans saved, add 10 percent each round, and watch the adding accelerate. Grid two: 100 beans of debt at 10 percent per round while repaying only 8; the pile grows despite paying. Let the learner run both grids until the pattern hits. Then discuss why so many families are trapped by loans, and present the Islamic finance perspective on riba alongside, letting the family's values frame the conclusion.

Learning material

Compound grid sheets for saving and debt (platform library)
Discussion card: interest, inflation, and riba

Practical exercises and activities

Simulation: run both bean grids over ten rounds and chart the curves. Real world: find one real loan advertisement and calculate its true yearly cost. Family discussion: where has compounding helped or hurt people we know?

Materials required

A few hundred beans or buttons, grid sheets, calculator.

Assessment checkpoints

Learner explains compounding in both directions with their own charts and calculates the real cost of an advertised loan.

Learn with AI

Ready-made prompts for this module. Copy one into your AI assistant and it becomes a patient tutor that follows the OSH method: no lecturing, no rote learning, hands-on activities included.

For the student

A tutor that teaches this module step by step, asks questions, and never just gives answers.

For the parent or teacher

A coach that helps you prepare, deliver, and troubleshoot this lesson.

How to set this up in ChatGPT, Gemini, or Claude

ChatGPT: Open ChatGPT → press your profile → My GPTs → Create a GPT → paste the prompt into Instructions → name it after the module → save for repeated lessons. Or simply paste the prompt at the start of a new chat.

Gemini: Open Gemini → Gems panel → New Gem → paste the prompt into the instructions box → name it after the module → save. The Gem stays available for every study session.

Claude: Open Claude → create a Project (or a Skill in Claude Code) → paste the prompt into the project instructions → every conversation in that project becomes a tutoring session for this module.

Safety note: children under 13 should use AI assistants together with a parent, and account age rules of each platform apply.

This module is part of the open OSH curriculum, licensed under Creative Commons BY-SA 4.0. Print it, adapt it, share it.