This chapter presents the review of related literature and studies underlying the framework of the study. It includes the conceptual model of the study and the operational definition of terms.
REVIEW OF RELATED LITERATURE AND STUDIES
Introduction
One of the issues that the government, particularly the Department of Education (DepEd) is facing nowadays is that – teachers are living in deep debt.
In 2003, the Department of Education (DepEd) took a serious look at the salary loans from private lending institutions (PLIs) which utilized the automatic payroll deduction scheme.
Salary Loans
Analysis of payroll slips that over 450,000 teachers and non-teaching personnel under the DepEd had an estimated P14 billion in outstanding salary loans from around 195PLIs. This meant an average loan of slightly over P30,000 per teacher over a 12-month period at an average interest rate of 75.5 percent per annum (or over 6 percent per month).
On top of this burden, public school teachers have an estimated P15 billion more in salary loans from GSIS, the state pension fund, which was also repaid through automatic payroll deduction.
Furthermore, housing loans from GSIS and Pag-Ibig added another P25 billion personal debt to be amortized over longer periods of time. All told, less than half a million public school teachers and non-teaching personnel had a total personal debt of over P54 billion in 2003.
Older married teachers borrowed up to three times a year to fund school fees of their children (especially college); younger teachers borrowed irregularly for appliances and events. A good number also borrowed to help out extended families.
Borrowing to make ends meet has been so prevalent among teachers that it has become a part of the culture. The vast majority are “over-borrowed” with the common remark that they live in a “London
The General Appropriations Act now establishes a minimum take-home pay for teachers of P3,000 per month. If this were not enacted, a significant percentage of teachers would have no monthly take-home pay.
In 2003, the DepED also directed that no PLIs could use the automatic payroll deduction scheme if they charged more than 18-percent interest and more than 6 percent of the principal in processing fees.
The current policy has resulted in an average real effective interest rate of 24 percent (versus the 75.5 percent before). Fly-by-night lenders were taken out of the system, and payroll slips were redesigned so that PLIs would know if a teacher had over-borrowed.
Still, many teachers find ways to borrow even more to stay ahead. Unfortunately, they end up resorting to the more ruinous “5-6” type of lending.
How to Deal with The BIG Debt Trap
How does one get out of the BIG Debt Trap? It's not easy but it's doable. The following are some of the things you can do if you are trapped with BIG debt. These are stop borrowing, simplify your life, sell all the doodads you don't need, renegotiate your debt and find out how you can pay them at a discount, set up an automatic debt repayment program, and EXPAND your means.
Stop borrowing. Cut up all your credit cards except one (and you can use this ONLY for emergencies like life and death situations. A 50% sale at your favorite department store is NOT an emergency).
Simplify your life. Understand the difference between your needs and your wants. You need to drink. You want to drink a 50 year old wine that costs $150 a bottle but you don't need it. Drink water instead. It's healthier too.
Sell all the doodads you don't need. I bet 80% of these stuffs you bought are things you probably don't need or use anyway. Raise some cash and use the cash to pay off those debts.
Renegotiate your debt and find out how you can pay them at a discount. Use the BONUS you get from your job to pay off your credit card balance at a discount. You'll never know - they might accept the lower amount as payment in full. The truth is, banks are in the business of making money on your money by lending it. Because of this, banks and credit card companies are sometimes willing to get their money now, even at a discount so they can lend more money.
Set up an automatic debt repayment program. Automatically deduct the payment for each credit card/ lender out of your checking account. I suggest you focus on paying off the debt that consumes the highest monthly payment with respect to the outstanding balance FIRST while paying the minimum payments on the other credit cards. By doing this, you will pay off your credit cards very fast. You will pay them off a lot quicker than you think.
EXPAND your means. One advantage of having BIG debt is it forces you to generate new streams of income. Think of Donald Trump. Back in the early 90s when he got into financial trouble, he was at one point NEGATIVE $900 million in the hole. He was poorer than a beggar because he owes $900 Million more personally than all the assets he own.
Australia , Japan , the United States and the UK
Education
Education has been defined by different authors differently but with same concept and meaning. According to wikipedia, education in the largest sense is any act or experience that has a formative effect on the mind, character or physical ability of an individual. In its technical sense, education is the process by which society deliberately transmits its accumulated knowledge, skills and values from one generation to another.
Etymologically, the word education is derived from educare (Latin) "bring up", which is related to educere "bring out", "bring forth what is within", "bring out potential" and ducere, "to lead".
Teachers in educational institutions direct the education of students and might draw on many subjects, including reading, writing, mathematics, science and history. This process is sometimes called schooling when referring to the education of teaching only a certain subject, usually as professors at institutions of higher learning. There is also education in fields for those who want specific vocational skills, such as those required to be a pilot. In addition there is an array of education possible at the informal level, such as in museums and libraries, with the Internet and in life experience. Many non-traditional education options are now available and continue to evolve.
Teachers
In education, a teacher is a person who provides schooling for others. A teacher who facilitates education for an individual student may also be described as a personal tutor. The role of teacher is often formal and ongoing, carried out by way of occupation or profession at a school or other place of formal education. In many countries, a person who wishes to become a teacher at state-funded schools must first obtain professional qualifications or credentials from a university or college. These professional qualifications may include the study of pedagogy, the science of teaching. Teachers will have to continue their education after they receive their degree from a college or university. Teachers may use a lesson plan to facilitate student learning, providing a course of study which covers a standardized curriculum. A teacher's role may vary between cultures. Teachers teach literacy and numeracy, or some of the other school subjects. Other teachers may provide instruction in craftsmanship or vocational training, the Arts, religion or spirituality, civics, community roles, or life skills. In some countries, formal education can take place through home schooling.
Informal learning may be assisted by a teacher occupying a transient or ongoing role, such as a parent or sibling or within a family, or by anyone with knowledge or skills in the wider community setting.
Religious and spiritual teachers, such as gurus, mullahs, rabbis pastors/youth pastors and lamas may teach religious texts such as the Quran, Torah or Bible.
Salary
A salary is a form of periodic payment from an employer to an employee, which may be specified in an employment contract. It is contrasted with piece wages, where each job, hour or other unit is paid separately, rather than on a periodic basis.Finance
Finance is the science of funds management. The general areas of finance are business finance, personal finance, and public finance. Finance includes saving money and often includes lending money. The field of finance deals with the concepts of time, money, and risk and how they are interrelated. It also deals with how money is spent and budgeted.
One aspect of finance is through individuals and business organizations, which deposit money in a bank. The bank then lends the money out to other individuals or corporations for consumption or investment, and charges interest on the loans.
Loan
A loan is a type of debt. Like all debt instruments, a loan entails the redistribution of financial assets over time, between the lender and the borrower.
In a loan, the borrower initially receives or borrows an amount of money, called the principal, from the lender, and is obligated to pay back or repay an equal amount of money to the lender at a later time. Typically, the money is paid back in regular installments, or partial repayments; in an annuity, each installment is the same amount. The loan is generally provided at a cost, referred to as interest on the debt, which provides an incentive for the lender to engage in the loan. In a legal loan, each of these obligations and restrictions is enforced by contract, which can also place the borrower under additional restrictions known as loan covenants. Although this article focuses on monetary loans, in practice any material object might be lent.
Acting as a provider of loans is one of the principal tasks for financial institutions. For other institutions, issuing of debt contracts such as bonds is a typical source of funding.
Literacy
Literacy has traditionally been described as the ability to read and write. It is a concept claimed and defined by a range of different theoretical fields. The United Nations Educational, Scientific and Cultural Organization (UNESCO) define literacy as the "ability to identify, understand, interpret, create, communicate, compute and use printed and written materials associated with varying contexts. Literacy involves a continuum of learning in enabling individuals to achieve their goals, to develop their knowledge and potential, and to participate fully in their community and wider society."
Financial literacy
Financial literacy is the ability to understand finance. More specifically, it refers to an individual's ability to make informed judgments and effective decisions through consciousness of the financial dimension of economic undertaking. By contrast, raising interest in personal finance is now a focus of state-run programs in countries including 
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