Teaching Financial Literacy: 5 Critical Concepts About How Money Works

Image attribution flickr user Tulane Public Relations

Teaching Financial Literacy: 5 Critical Concepts About How Money Works

contributed by Karla Lopez

The young people today face a staggering number of elaborate financial decisions.

One problem is that most of them are not ready to make well-informed financial decisions as they proceed into adulthood. As a matter of fact, according to the study in 2014 titled “The Financial Capability of Young Adults—A Generational View,” 3 out of 4 young adults can’t answer simple financial questions.

While helping students develop traditional academic knowledge is useful for every child’s future, teaching students about financial literacy can be the difference between a life well-lived and a constant struggle to meet the crushing demands of money.

By teaching financial literacy lessons early in a child’s cognitive development, we can motivate or inspire them to save money and empower them to be caretakers of their own financial futures. Below are five important financial literacy concepts to consider when teaching financial literacy.

Teaching Financial Literacy: 5 Critical Concepts About How Money Works

1. Debt

Critical ideas: The definition of debt; The ‘math’ of debt; assets; common debt sources; debt reduction strategies; debt traps; taxable income

It’s easier to gain debt than to eliminate it. Young people often don’t fully understand how easy accrue debt. Because of this, it is essential to conduct lessons about debt earlier than later. Moreover, common personal debt sources are credit card debt and student loans. 

2. Budgets

Critical ideas: The definition of ‘budget’; priorities; needs vs wants; budget examples and templates; budget strategies and goals; budghet apps, resources, and tips

One of the essential aspects of staying completely in control of your finances is by building and sustaining a budget. Nowadays, it is much easier than ever to make a budget through the aid of several apps and websites–, for example.

Many of these user-friendly tools have important data and calculations embedded within them, as well as useful visualizations of how money is being saved and spent. With such tools, anyone can keep their finances on track if they’re living within their means.

When used correctly, they will keep you up to date about where your money is going. No matter how great the software is, if you don’t actually follow the budget, it won’t help. Therefore, any financial novice should begin mastering the basics of principles of budgeting.

3. Investments and Savings

Critical ideas: Account types, IRAs, 401ks, taxes, stocks, bonds, CDs

Clearly, saving is an important aspect of any kind of grasp of financial literacy. However, most of the young people do not prioritize or treat this aspect as necessary as much as they should. It can be easy to neglect things like retirement because it lacks the immediacy of everyday life. It can be difficult to ‘worry’ about something that won’t happen for half-a-century or more. However, learning to save money early can aid you in gaining a set of discipline, skills, and knowledge you will use in your life.

Financial novices can begin saving in the simplest sense–saving money for clothes, technology, books, or concerts they desire, for example. While developing their ‘saving skills,’ students can also develop qualities like patience and diligence which–for most students–only grow through practice. 

4. Interest Rates

Critical ideas: Compound interest, amortization, relationship to credit score, loan types

Although students have likely heard about interest rates in math class, it is very critical to learn various aspects such as ratios, percentages, and compound interest. These financial literacy concepts can help students in very practical ways–learning about the difference between borrowing money and repaying with interest and fees, for example.

Understanding interest rates can influence finances more than most realize and is a simple but powerful concept to learn.

5. Credit

Critical ideas: Credit scores, interest rates, annual fees, rations (e.g., debt-to-income), identity theft, deferment

The concept of credit–the ability of practice of asking for money that you don’t have because it’s believed you’ll pay it back at some point–is a concept deeply-embedded in Western culture. This has many drawbacks, including how thoughtlessly it is practiced as a result. For many, it’s just accepted that you’ll spend a lifetime borrowing other people’s money and that, rather than making it yourself, it’s better to constant groom your own financial identity so that your believability and ‘creditworthiness’ are improved. This is a hurtful belief that can cause students to spend a lifetime struggling with ‘money’ when in reality, the issue is how they think about money.

Further, with the explosion of credit and lending, identity theft is more widespread and common than ever. Because almost everything is digital and most people shops online, student financial info is at great risk and keeping accounts safe is a daily practice through preemptive measures such as limiting the amount of info shared online, encryption, and password protection.

Other important financial literacy ideas: The economy (e.g., how it works, federal rates, trends and markets, etc.); different financial account types; wages and income types; cryptocurrencies


Financial literacy is essential as it prepares students with the right skills, habits, and knowledge they need to stay on top of our finances effectively. Without it, their financial decisions can lack a robust foundation for success. There’s a lot that goes into financial literacy–so much so that it there are entire industries, academic fields, and institutions tied to economic and financial support.

However, these five concepts above can be useful as a head-start in supporting students as they develop ‘life skills’ to, matched with their academics, learn to live well.


A Simple Compound Interest Calculator

A Simple Compound Interest Calculator

by TeachThought Staff

One of the foundations of financial literacy–or saving and investing, anyway–is understanding the benefits of compound interest.

The big picture here is what a child ‘needs to know.’ At TeachThought, we support the prioritizing of thought over content (while realizing that they’re not mutually exclusive).

We also value thinking habits, critical literacy, supporting/growing teachers, questions/inquiry, the role of place in learning (often through project-based learning)–and personalized learning, self-direction, thoughtful technology integration, adaptive learning algorithms, mobile learning. citizenship, and dozens of other ideas that center children and their place and story and future over everything else.

And financial literacy is a big part of all that, which is why we’re sharing a simple and easy-to-use compound interest calculator from Wolfram Alpha, which you can find below.

Also, check out some of our financial literacy resources while you’re at.

A Simple Compound Interest Calculator For Students

A Simple Compound Interest Calculator For Students


Why Financial Education Is A Smart Investment

image attribution flickr user tulane public relations

Why Financial Education Is A Smart Investment

contributed by John Mason

Disclosure: This content was created and promoted by IG

Education is knowledge. It helps people gain skills they can use to improve their lives, which in turn boosts the economy. In third-world countries, where fewer people receive an education, poverty is rife, and most people never achieve their potential.

Math and literacy skills are the foundation stones of a good education but don’t underestimate the importance of financial literacy. Being able to make financially responsible decisions has a far-reaching effect on our lives and the lives of those around us. Indeed, one could argue that the global financial crash of 2009 was, in part, caused by individuals in positions of power making financially irresponsible decisions.

The Perils of Uncontrollable Spending

On a personal level, a lack of financial literacy will probably lead you into debt. This is not great for you, but if you are in a position of responsibility, perhaps in charge of your family’s finances, or even in a job where you are required to manage money, it could be disastrous.

Let’s use Dennis Kozlowski, CEO of Tyco, as an example. Kozlowski’s financial incompetence knew no bounds. Whilst he was good at his job, he soon realized it was helpful if the company picked up the tab for his personal spending. He used company money to fund a $19 million NYC apartment and spent a further $11 million on furnishings. He also granted himself unauthorized bonuses and charged a $2 million birthday party to the company. But, the good life eventually unraveled. In the end, tax evasion was his undoing and he ended up in prison.

Most people don’t commit major financial fraud or end up doing time in jail because of financial incompetence but making poor money decisions could easily lead to credit card debt, escalating pay day loans, and the bank foreclosing on your home. None of these scenarios is especially attractive, which is why a good financial education is a smart investment.

What is Financial Literacy?

At its most basic level, financial literacy means being able to understand how to budget, plan for your retirement, and avoid debt, whether you live in London or Nairobi. On a more sophisticated level, someone with a high degree of financial literacy might have success trading in forex or stocks.

Whilst a lack of financial education is a real problem in the developing world, it can also be problematic in developed countries too. An OECD study published in 2017, focussing on 15-year-olds in 15 different countries, found that only 22% of teens had basic financial literacy. Chinese teens have far less money to spend than European or American kids, but they scored much higher on financial literacy. Interestingly, the US ranks below Canada, Belgium, and even Australia, where kids are far more likely to understand the fundamentals of short-selling Australia or compound interest.

Amazingly, financial literacy is rarely taught in school. A college student can spend three years studying the intricacies of molecular biology, earning a first-class honors degree, and still remain dangerously clueless about the merits of balancing a household budget. But, without this knowledge, you will struggle to build wealth and attain a high degree of financial security in the future.

The OCED study recommended that children are taught financial literacy in school. As financial products become increasingly complex and kids have ever-greater choices over which products they buy, it is imperative that they learn the basics in school. Arguably, parents should be teaching their children about financial topics, but may parents are themselves financially illiterate.

Educating Kids about Money and Finance

Most kids learn the art of saving when they receive pocket money. The days of piggy banks are largely in the past and modern kids are more likely to be given a credit card with a spending limit, but it’s essential that you tutor your children about budgets, credit, and how to save and invest for the future. If kids are not armed with this knowledge, their poor decisions in the future might even contribute to the next financial crash.

In summary, financial education is a long-term investment in human capital that will make a real economic difference for future generations.


An Overview Of Budgeting & Student Loans For College Students

An Overview Of Budgeting & Student Loans For College Students

contributed by Jenna Smith

When you’re in college, you learn a vast amount of information about almost everything under the sun. Unfortunately, unless you’re a finance or accounting major, it’s unlikely that you’ll come across any Personal Finance 101 classes before you get out into the rat race. 

This might not be a big deal if you didn’t have a student loan, but because you have not had the opportunity to learn the basics of personal finance you will probably have little idea about how to get the best rates for your student loans, what to do if you get behind in your payments, or how to refinance student loans. Additionally, you may only have a vague idea about how to make a budget so that you can reach your financial goals after college. 

Let’s discuss these 3 issues to help you quickly get up to speed. 

Student Loan Overview

1. How to get the best rates on your student loans. 

Begin by comparing student loans. It’s advisable to use a comparison website to be able to compare several banking or lender programs, compare minimum and maximum rates of interest, compare monthly payment, compare total costs, and compare APR. With a creditworthy cosigner, apply to several programs that you like and for which you’re eligible. By applying to several at one time, you increase your odds of getting approved and getting the best terms.  

2. What to do if you get behind on your student loan payments. 

It’s costly to fall behind on your student loans. Your credit rating will take a hit, your late fees will begin to pile up, and your interest rate will begin to grow. Additionally, the federal government has the power to confiscate your tax refund and garnish your wages to pay it off. 

The first thing is to contact the loan servicer to find out how much you owe and work out a payment plan. If you are able to afford the monthly payments, then set up an automatic billing payment system so that you can negotiate for a reduction in your interest rate. Another option is to apply for student loan refinancing and consolidation.

A bank or lender will make a decision based on your credit score, your annual salary, your other financial assets, and your type of college degree. If you are still in school, then they will ask for a certificate of enrollment. If you don’t get approved, then try applying with a cosigner.  

How To Create A Budget That Works

You need a budget because it will help you stay on track with your financial goals. Without one, your finances are not under control. As a result, you have no idea where your money goes, if there is a way to spend less, how to handle unexpected expenses, or how to start saving for a bigger financial goal. 

1. Define your goals.

In order to create a budget, you need to start by defining your financial goals and when you hope to reach them. Understanding how a budget will help you achieve short, medium, and long-term goals will keep you motivated to keep on writing down the amounts of money coming in and out of your life 

2. Choose your tools.

Next, find a budgeting tool that you find easy to use. There is an abundance of free and paid tools available. Moreover, when it comes to paid tools, software companies will give you a trial offer for a week or a month to try out their product to see if it is right for you. So, you’re not spending money on researching the best budget software on the market. 

3. Analyze/itemize income and expenses.

Now that you’re clear on your goals and have found a free or paid budget tool, you should identify your income and expenses and then enter them into your budget tool. 

The most common approach is to do this by category, where expenses can be grouped first as ‘Recurring’ and regular bills that can be expected each month and usually don’t vary greatly, and then more specifically by category (e.g., Utilities, Food, Clothing, etc.)

By grouping expenses into categories, you can quantify expected expenses and plan for spending accordingly. Further, many budgeting tools do this automatically as they reconcile with banking accounts. A lot of the work here is upfront, as you label certain expenses early on, and the software learns over time how to categorize costs automatically.

At this point, ‘budgeting’ may seem to be on auto-pilot, but you still must pay attention to the accuracy of this automatic labeling, and then consistently adjust your budget based on changes in expenses and/or income.

4. Limit spending based on anticipated income and expenses

Finally, keep on tweaking your budget by becoming aware of how much money you have left over after you receive money and pay for all your necessary expenses. By understanding your inflow and outflow of money, you can make any necessary adjustments, especially when and if it changes over time.

A budget is only as good as its execution. No matter how convincing it seems on paper on a digital dashboard, it’s in the day-to-day transactions for food, gas, recreation, and related events that a budget works or fails.

5. Adjust and repeat based on progress/lack of progress towards goals.

Notice one category is consistently more or less than anticipated? Adjust the amount.

Earning more or less than you’d planned? Adjust spending accordingly. If you’re making more, pay down debts first and create a savings plan. Making less? Reduce spending or eliminate categories altogether. (Hard to have a ‘rain day’ fund if you can barely afford your car payment.)

The big idea is that a budget should be a framework to plan for how you spend your money, but flexible enough to adjust to life and its financial ebbs and flows.

In summary, you will probably need to learn about personal finance outside your curriculum. This can help you get student loans at the best interest rate, figure out what to do if you fall behind in your payments, and help you take control of your financial future through budgeting. 

image attribution flickr user tulanepublicrelations


Money Matters: 3 Financial Literacy Lessons For Students

Literacy Lessons

Money Matters: 3 Financial Literacy Lessons For Students

contributed by Jess Holmes

This is sponsored content

As educators, we are responsible for more than just passing on knowledge and formulas; we are thought-makers and soul-crafters.

Also, we should be able to give students some practical know-how, and you don’t have to be teaching economics to provide sound advice. For example, math teachers could spice up their talks with concrete examples of the math skills students are learning, or history teachers could catch the audience’s interest with a comparison of money systems now and a few centuries ago.

Personal finance is a topic that will impact a young adult’s life significantly. Making the right choices from the beginning could mean the difference between having a great life-work balance or putting in extra hours while still struggling in debt.

1. Make a budget that works for you, then stick to it.

Teachers are usually frugal spenders since their income does not permit extravagant items. This makes them more likely to be using a monthly budget. Talking about this with students does not only increase curiosity but could be a starting point for making them question their initial assumptions and open the discussion between the student and their families about money issues.

Teachers are expected to talk to students about their options for further education, like going to college, but usually, the talk remains in the academic area and money is not part of the discussion. This approach is wrong since only a 360 degrees evaluation of such a complex problem can offer the right answers. Otherwise, students find themselves in the unfortunate situation to take any job just to pay their student loan debt.

As a teacher, you can encourage them to learn more about this topic too before choosing a program that sounds interesting.

2. Compound interest is powerful, but requires patience and delayed gratification.

We are all told that we need to save money, but the math behind what choices we should make is usually not discussed. Compound interest is the tool that makes simple savings grow over time by giving the saver a return also on the interest earned, not only the initial investment.

Numerous online calculators show that if you start early enough (i.e., in your 20’s) and save consistently, you could retire as a millionaire without having a rich uncle leave you a fortune. It is all about making the right choices every day. This lesson is similar to leading a healthy lifestyle. The theory is straightforward, but sticking to the right thing and avoiding temptations is the hard part.

Math and computer science teachers could use these examples to motivate students and make them curious about ways to invest money. The stock market is not only for CEOs of Fortune 500 companies.

3. Always be clear what you’re getting yourself into.

During a test, we always warn our students to read the problem or requirement carefully to be sure they give the full answer and get the best grade. However, we don’t stress enough this idea when it comes to real life.

Although all students can read a contract or a statement, do they really understand all the implications? Teach them to pay attention to the details such as fees, commissions, penalties and not only look at the final payments they have to make but to be meticulous and break that down into components.

When taking a loan or opening a new credit card, it is essential to know in advance how much you are going to spend with administrative costs. Tell them not to settle for the first option and use online portals, like the AAA Credit Guide to compare different credit companies before making a choice.

Modeling Your Experience

Of course, the best way to make sure these literacy lessons stick in the mind of your students is to practice what you preach and give them clear, real-life examples.

Even negative examples, including stories about the mistakes you have made and learned from, are excellent starting points to challenge them and make them more interested in improving their financial knowledge.


Good Credit, Bad Credit: 3 Ways Credit Scores Can Affect Students

Credit Scores

Good Credit, Bad Credit: 3 Ways Credit Scores Can Affect Students

contributed by Jenna Wilson

For better or for worse, we live in a credit-driven economy.

As such, your credit score is one of the most important numbers connected to your finances. That one number can   large purchases, among many other problems. Few people realize that a bad credit score can also hold back a career before it even starts.

It’s your right to access your credit report for free once a year in order to check your credit score. If your credit score falls below 650, students may experience financial and professional setbacks.

While ‘having good credit’ seems like a no-brainer, here are three specific ways good credit benefits you.

1. Better Interest Rates

The most obvious way a poor credit score can have a negative impact is by limiting your ability to get a loan and open lines of credit. When a loan is approved the interest rate paid is largely based on credit worthiness. A low credit score can end up costing a person thousands in additional interest.

-Student Loans

Paying for law school can easily cost $50,000 or more in most states. Going to medical school costs at least $100,000 in tuition alone. The average medical student takes out nearly $165,000 in student loans. It’s the equivalent of purchasing a home in many cities. Without good credit, some students would never be able to become a doctor.

Many people need a little financial assistance just to earn their bachelor’s degree, which averages out to $9,650 a year in tuition and fees for in-state students at a public college. Without student loans, you may have to rely on more expensive resources like credit cards.

-Home Loans

Getting a home loan can prove to be equally difficult for those who have bad credit. At such high loan amounts, even a slight increase in the interest rate can dramatically change the monthly expenses. You’ll also have to save much more due to higher down payment requirements. The barrier of entry for homeownership is lower for those who have excellent credit and pose less of a risk in the eyes of lenders.

-Automotive loans

For many students, a car purchase is the first experience with taking out a loan. Typically, auto dealers are more lenient with credit score than banks, but the expense is higher interest rates and longer terms that increase the total cost. Having to go through a dealer can also increase the price paid for the vehicle compared to buying directly from the seller using a secured personal loan.

If you’ve never used credit before and have a very limited credit history you may have to lease a vehicle before you can buy one. Use it as an opportunity to build your credit score by making sure to make every payment on time.

2. More Options for Buying, Renting, and Leasing

If you’re a renter your credit score can still affect your living situation. Landlord and property managers run credit report checks as a part of the background check for the same reason lenders do. They want to see how consistent you are at making monthly payments.

Typically, landlords require that applicants have a fair to excellent credit score. That would include scores ranging from 650-850. Without a fair credit score, your housing options could be limited.

3. Credit Can be Part of a Student’s ‘Resume’

Poor credit indirectly hurts a student’s career by making college less affordable. However, being able to take out student loans for college isn’t the only way your credit score can affect your career.

Many employers run a credit check on job applicants. Any position that will require security clearance will include a review of your credit report. Jobs that are financially-related also typically include a credit check. A poor credit score can indicate financial stress or past issues managing money, which is considered a risk. On the opposite end of the spectrum, applicants with excellent credit are, for better or worse, seen as responsible and reliable

Our credit scores come into play throughout our adult lives. By treating their credit use as they would the college admissions preparation and testing, students can enjoy more flexibility and reduced costs after graduation.

image attribution Flickr user tulanepublicrelations


10 Ways Teachers Can Save Money On Printing


How To Save Money With More Efficient Printing


This is sponsored content.

10 Ways Teachers Can Save Money On Printing

The popularity of tablets and other digital devices for studying hasn’t changed the fact that print still plays a significant role in education.

Despite digital technology’s ongoing popularity, print is still the most effective learning medium for many students. It offers a quiet space away from online distractions, and enables them to better focus and absorb what they’re reading. On a deeper level, tablets may change the way students interact with text and affect their ability to consume and recall information according to researchers at EDUCause Review.

Unfortunately, printing can be quite expensive. This is especially the case for teachers who print in the classroom from personal printers. School districts frequently are tied to an incredibly limited budget on printer resources, and teachers will often take on the financial burden of buying printer ink out of their own pockets. Not surprisingly, this gets costly very quickly.

There are ways to use your printer that can do wonders for cutting costs without shortchanging your students. Here are a couple of helpful tips to help you use less ink and paper in your everyday teaching.

10 Ways Teachers Can Save Money On Printing

Draft mode. Your printer features multiple printing options to customize your ink use and print speed. When you’re printing documents that don’t need to look perfect (ie. letters to parents or event reminders), print them in draft mode. This mode uses less ink and prints faster than standard and high-quality print modes. While your prints may be lighter and your images less robust, your prints are more economical—something I’m sure the parents of your students won’t mind!

Font efficiency. Different fonts use different amounts of ink. While the difference between one typeface and another may not be huge per page, the savings add up quickly if you print a whole lot for your classes. Some designers have developed fonts explicitly crafted to use less ink in print. Fonts such as Century Gothic and Ecofont work differently and switching your font can make a difference in your wallet and the environmental impact your print makes.

Compatible cartridges. Buying black and color cartridges gets expensive quickly. Compatible cartridges purchased from established reputable retailers give you the same results as brand name ink but 40 to 60 percent less expensive. To illustrate, for the price of an original HP 564 standard cartridge ($14.99, prints up to 250 pages), you can get 600 total pages more from two high yield compatible 564 cartridges from LD Products ($6.99, each cartridge prints up to 550 pages). Compatible cartridges help you print more while you pay less.

Also, a quick note—you may come across a few articles that recommend HP’s Instant Ink service as an alternative to buying cartridges when they run low. A word of caution: this might sound like a good idea at first but be sure to read the fine print as there may be some things you should be aware of before diving in.

Reuse prints. Don’t reprint for every class, every year. Collecting up reading assignments and other handouts and reusing them will drastically reduce the amount of printing you do annually. You can even incentivize returning reading materials in good condition by offering extra credit on worksheet assignments. You can easily get two, maybe three runs on each printed packet before wear and tear takes over.

Both sides. Print out documents on both sides of the page whenever possible. Most office copiers and quite a few desktop laserjets offer double-sided print options as a standard feature. If you’re printing from your inkjet, you can re-run the backside of pages to print them again or use the back of each as scrap paper.

Reduce margins. The more words you can fit on the page, the better. Adjusting the margins on the top, bottom, and sides of the page before you print can put more text on each printed page, thereby using fewer supplies in the process. Reducing the size of your font will also use less ink and fewer sheets of paper, but do this only if it won’t affect text readability.

Print from read-only mode. A lot of websites today give readers the option to switch over to text only mode for ease of reading. If you are printing an article from the web, avoid printing the unnecessary headers, images, and most especially the comments section!

Be sure to print only the pages with the content you need. Some websites will automatically reformat pages for print, but taking special note of the way your print preview screen looks before you hit “Print” can help save unnecessary pages from being printed. As mentioned earlier on in the article, print on both sides of the paper and reduce margins if you can as well.

Team up and buy in bulk. There are times when you save money when you buy in bulk. When buying supplies, ask other teachers in your department and pool your resources. Buying larger increments of paper and ink allows you to tap into better deals offered by retailers.

Learn more about printers. Over time, printers break down and need replacement. When it comes time to swap out your old unit, be sure to do some research and learn what type of personal printer is best for your classroom needs. If you aren’t printing many photo quality images for your classes, a laser printer prints faster and requires less frequent toner replacements which can save you money in the long run unlike an inkjet printer.

However, if you rely on color prints for your instruction, an inkjet may be just what you need. If you’re shopping for a new inkjet printer, bear in mind that the cheapest printers can become very expensive down the road when you take into account the many times you need to replace ink cartridges. Doing a bit of research into different printer models and their efficiency ratings will help you find just the model you need.

Saving money on print is something you can do easily on your own today to help your bottom line. When working with colleagues in your department, school, even your district, you can help save a bundle of money (while using less resources too). Bringing down your print costs gives you more room in your budget to get the kinds of things that take your teaching to the next level.

The LD Products Content Team researches and writes about the ways individuals can cost-effectively utilize printing technology for improved efficiency at home and in the office.

Disclosure of Material Connection: This is a “sponsored post.” The company who sponsored it compensated us via payment, gift, or something else of value to write it. Regardless, we only recommend products or services we use personally and believe will be good for our readers. We are disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”

10 Ways Teachers Can Save Money On Printing


Why We Need Financial Literacy Resources For Teachers



by Dawn Casey-Rowe

Resource Details

  • Participation in the H&R Block Budget Challenge must be facilitated by a classroom teacher at an accredited high school or home study program. Educators may visit to register their classrooms. Class creation closes one week prior to the simulation start date and for this round the deadline to create your class is January 7th, with rolling class creations through February 4th.
  • Budget Challenge is open to students 14 years of age or older, enrolled full-time in grades nine through 12 with teachers who have registered them. Students may play one simulation per semester (Fall and Spring) but they are only eligible for prizing on their first attempt. Home school students may play one simulation per school year.

Why We Need Financial Literacy Resources For Teachers

“That’s crazy!” my juniors said.  “How do you get $410,000 in student loan debt?”  

“You go to an expensive school, defer your debt, go to grad school, file for forbearance, and the interest keeps going up…”  I explain the concept of compounding interest straight from the Financial Literacy 101 Playbook.

We read a recent article in the New York Times where a teacher accrued nearly a half-million in student loan debt.  This is serious.  Bankruptcy is not an option with student loans.  These loans follow a person forever–taxes refunds can be confiscated, wages garnished.  The woman in the article would have to pay $2700/month for the next 30 years to dig out of this debt, a true tragedy.  

That’s an uncollectable situation with devastating consequences. It’s the student loan equivalent of the America’s housing crisis. Some of my students were victims of that situation. They understand the analogy.

This woman was an intelligent, educated woman who overborrowed–like a great deal of the nation.  This speaks to my point–any one of us can fall into this trap.  Even me.  I’m in my fourth decade in life. I’ve made all the makes and I knew better. That’s why I teach financial literacy. Financial literacy is a critical component of success in life, yet often it’s not in the curriculum.

“Miss, why is this the first time we’re hearing about this?” my seniors asked last year.  I was teaching a Consumer Economics class I unofficially subtitled “How I Got My Butt Kicked So You Don’t Have To.” In addition to teaching the traditional financial literacy cannon–loans, debt, interest rates, taxes, savings, good purchasing habits, I taught a hefty dose of entrepreneurship.

It’s not the outrageous financial situations that bury us–it’s the temptation to press forward a little too much ignoring the red flags. We have the illusion we’ll be able to fix things later on.  Adults do this–that’s why it’s critical to teach kids young and continue to practice good habits ourselves.

I’ve overextended a hundred times in my past. I’ve given gifts I couldn’t afford using credit cards–completely justifiable. I’ve charged up thousands of dollars in credit card debt filling my classroom with the basics school didn’t supply–again, seems logical.  Only a small fraction of this is tax deductible, unlike when I am consulting and I can write off the kitchen sink.  

I’ve used the equity in a house to save and bootstrap a business. This is one of the top entries on the Top Ten “Don’t Do It!” list–yet I did it. I cashed out the 401K from my first career to pay down college debt.  This is also a giant no-no.

“But wait! There’s more!” I’ve done it all, and every single thing seemed reasonable at the time.  People bury themselves slowly.  Companies do it as well. Financial literacy is about learning discipline and developing the skills of analysis and evaluation in order to take appropriate risks and actions to plan for the future you want to have.  

I’m older and wiser now, but I wish some of these lessons had sunk in earlier, so I tell honest stories to students. Those stories matter. They give students a glimpse of what real people deal with in the adult and business worlds. My students don’t know about risk assessment, being properly insured, how to compare savings and lending institutions, and how to use an ATM card, the hidden charges in buying or renting a primary residence.  

“Why is the bank charging me these $25 fees?” asked one kid. He didn’t know he had to put the money into the bank prior to using the ATM, and just because the post didn’t hit the ledger instantly that didn’t mean that same money could be spent twice. On the flip side of the equation was a junior who had his own business at age 12. He started mowing lawns, bought a beat up truck and more equipment at 16, and started hiring his friends.  

“You have a real business,” I said. He was complaining about bad employees and saying he was going to sell one of his three boats since gas was expensive. That kid is a successful businessman today.  It’s never too young to start on the road to financial success–kids have the power of their passions and the reach of the internet in their hands.  With a little guidance and financial literacy finesse, they can make money before they even graduate.

Some financial literacy topics seem too obvious to have to teach, but in my experience they’re not.  It’s never too young to teach the basics–as well as the more sophisticated elements–of financial literacy. One lesson that surprises students–and adults alike–is my class on “How Couponing Can Lose You Money.”


It seems counter-intuitive, I know, but it’s the truth–many a seasoned adult falls into the trap of overbuying or buying unnecessary things in the face of a doorbusting sale.  When factoring in the opportunity cost of running around to get to the sales and realizing that half the “nearly free” things wouldn’t have been on the list to begin with–it’s a huge net loss. I’ve done it.  

I’ve filled up bags of products I don’t use, felt victorious, then donated them to charity. That seems like a no-brainer until I look at the value of my time. If I just wrote out a check for that amount, I’d have come out way ahead–and it would have been tax deductible.

I teach students not only how to buy a car then to evaluate whether it’s better to drive it into the ground or have a reasonable loan with a newer car without repairs.  I show them the value of their credit score, and why I–with a score at the top of the range–might get better deals than them if they don’t nurture this number. I teach them how to fix their scores if they get it wrong right out of the gate.

I didn’t even get to the concept of insurance yet–this cripples adults, too. According to Professor Eric Johnson’s study in this shocking New York Times feature Why Consumers Often Err in Choosing Health Plans, only 21% of Americans could effectively choose the best insurance value given a set of plans to choose from and hypothetical set of medical costs.

These comparisons are life skills that can make or break a person. Financial literacy has never been more critical than today, especially given that technology allows us to act immediately upon impulse. We can buy on line, bank 24/7, and become victims to phishing and fraud schemes very easily. The things we usually think of when we discuss financial literacy topics are only the tip of today’s iceberg.

I don’t want students to navigate life blundering through the same mistakes I made in my early adulthood. I want them to imagine success now and know the steps they’ll take to achieve their goals. This, again, is not always intuitive. Some students come from financially literate families, but many do not. Even for financially literate families, our landscape is changing.

Many of today’s grandparents had one job with a pension. My parents’ generation had a few jobs with a pension. My generation tends to have three to four careers. Experts say my students will have to piece together skills leading to as many as seven careers.  Many will be entrepreneurs, freelancers, and trendsetters.  That’s an additional set of financial literacy requirements right there.

How do you budget your money when you might earn a lot now but have a dry spell for months? How do you pitch for funding for your startup? How do you design, build, and release a product at the lowest possible cost? How can you make money with zero startup costs? These are questions for today’s student that go well beyond our usual topics–ones many are likely to encounter.

The United States desperately needs to teach financial literacy as a core course. Until we do, however, some companies like H&R Block are trying to address this deficit.

Financial Literacy Resources For Teachers

Because 50% of high school seniors lacked basic levels of financial literacy, H&R Block partnered with several national organizations, including DECA–noted for excellence in teaching high school entrepreneurship–to design the Dollars and Sense program, which includes an extremely informative blog, classroom resources. 

They also have created what might be the most fun resource of all, The H&R Block Budget Challenge, where classrooms can sign up for an online budgeting simulation that replicates the budget challenges of real life–bill paying, expenses, and responsible fiscal management. Top performing students in each segment can win $20,000 to $100,000 in college scholarships. Teachers can sign up classes to take part in these challenges, but even if you’re in a situation where that’s not possible, the resources on this site will help you start that conversation with teens and young adults.

Do your part and teach your children and students financial literacy. It can be layered over and integrated with any core area or any family experience. Decades down the road, they will be the next generation of successes, having avoided some of the landmines in the field of real-world finances.

This is a sponsored post on behalf of We Are Teachers and H&R Block. They wanted us to write about financial literacy and let you know about the challenge. The rest are our own ideas and recommendations.

Why We Need Financial Literacy Resources For Teachers


14 Lesson Plans For Teaching Financial Literacy

hrdollarsandsense-financial-literacy14 Lesson Plans For Teaching Financial Literacy

by TeachThought Staff

1. Ruth Gale-Paredez: “What education do you need to live comfortably?”
Fifth-grade students figure out how much it costs to live for a family of four. The survey is taken for all expenses including taxes and insurance and an amount of income is calculated. Then a career is chosen to meet their needs and wants.

Ed note: Note, we’ve noticed that almost all of the links from this 2013 post are now broken. We will update it ASAP with current links.

14 Lesson Plans For Teaching Financial Literacy


Integrated Ideas To Teach Financial Literacy

hrdollarsandsense-financial-literacyIntegrated Ideas To Teach Financial Literacy

Financial literacy used to be a class in many schools–well, until that whole standards-based reform and “accountability” movement started turning the screws on schools.

And like that, it was gone.

It only takes one look at our nation’s financial crisis, heaps of student loan trouble, and general credit malaise to wonder if financial literacy shouldn’t be a bit higher on our priority list. An easy retort is to wonder who has the time–and where are the standards, where is the research, and who’s going to see the data?

But what if, rather than teaching a pure financial literacy lesson or unit, you tied it to your content area? What if it was embedded into a project-based learning unit about design or social media or the causes and effects of World War II?

What if you used a stock market app to analyze the relationship between a company’s branding and advertising campaigns and their stock prices? And how their marketing might change in response to changing market conditions and public perception?

What if your high school government class pulled back the curtain on the way lobbyists impact lawmaking–and corporate profits–and how they, as consumers, might respond?

Or if your math class calculate the lingering effect of debt on the collective human potential of your family? (Might need an English or Social Studies teacher to help with that one.)

Or had your students to develop a new social network–or twist on an existing one–that promoted financial sustainability in a “cool” way that didn’t seem dorky or preachy?

kenteegardinA Contest To Solicit New Ideas For Teaching Financial Literacy

One day, we might see traditional content areas like “math” and “science” melt into something quite different–something less academic, and more “organic” within the life of a student. Classes like Art History, Music History, Business, Design, and even Financial Literacy could then find their way back into a curriculum map near you. Until then, we need contests like this to promote innovation in its express instruction, it seems.

If any of this sounds like something you might teach, and H&R Block have partnered for a promotion that could be of interest to you.

(Hint: Here’s a pinterest board where you can see other good ideas. You know. Just for inspiration.)

Contest Details

The contest details can be seen at

“Cell phone bills. Gas money. Paying for college. Do your students have the money management skills it takes to survive in the real world? How do you help them to understand their current and future financial responsibilities?

Take five minutes to describe your favorite money-related lesson and you could win up to $3,500 for your classroom. Plus, everyone who enters will receive a $15 educator discount on his or her 2013 tax preparation at a local H&R Block.”

How It Works

  1. Submit a great idea. Here are some hints for making your idea stand out.
  2. Your idea will be reviewed by a panel of fellow educators, who will choose 10 merit finalists.
  3. The top three winners will be selected by the sponsor based on merit.

What You Might Get

  • One grand-prize winner will receive :
    a $3,500 grant for his or her classroom.
  • The second-place winner will receive:
    a $1,000 grant for his or her classroom.
  • A third-place winner will receive:
    a $500 grant for his or her classroom
  • All entrants will receive an educator discount on their 2013 tax preparation at a local H&R Block.

The Fine Print

H&R Block is the sponsor and WeAreTeachers is the official administrator of this program.

Apply By: December 11, 2013
Winner(s) Announced: January 2, 2014 
Integrated Ideas To Teach Financial Literacy; image attribution hrblock and flickr user kenteegardin
The Future Of Learning

Making The Gamification Of Financial Literacy Work


This is a guest post by Neale Godfrey

Making The Gamification Of Financial Literacy Work

Technology allows for instantaneous feedback and allows for immediate adjustment. The days of kids sitting in a classroom forced to learn the same way, writing down their homework, and waiting for the assignment to be graded and returned, may be fading in the way that they have previously existed.

Technology can now be created to compliment the child’s learning style.  Some kids learn via verbal or pictorial illustration, some through kinetic and others through still different means. New technology can pick up on nuances that perhaps would otherwise slip through the cracks in traditional learning environments. I’m not suggesting replacement, merely that today, more than ever we have myriad ways to get through to our children and technology can play a vital part of the process.

This idea is not novel, but what I have found, and what is starting to be implemented in some classrooms, is that in using technology as a teaching tool, we need to enforce the lessons learned through technological means in real life or we risk them living merely behind the screen. I have devoted much of my career to making our youth more financially literate. Twenty-five years ago, while President of The First Women’s Bank, I looked for books to teach my own young kids about money, because at that time – there wasn’t much in terms of technology to help my kids learn about the subject.

When I searched the shelves, there were none – so I decided it was time to write one. Many books later, I needed a new way to connect with today’s kids. It’s not that the fundamentals of the information I teach have changed all that much in the past 25 years, but as with everything else, the way we consume that information has changed.

The Role Of Video Games
But how do I combine the expanding technology with the topic of personal finance?  By speaking the language that speaks to kids…video games. Yes, that’s right, using a video game to teach fundamentals. I had to work with the changing technology to add another tool to the toolbox, so to speak, for parents when it came to the finical education of their children, and I wanted it to be both useful and enjoyable.

Thus came the birth of Green$treets: Unleash The Loot!, a mobile video gaming app for 5-8-year-olds that has since reached #1 Educational Gaming app in the iTunes store, to start to teach the financial facts of life in a different way. Kids think it’s just fun.  While playing games they enjoy within the app, kids earn money in the game and have to decide what to do with it.

In development, we realized we needed to add something else in order to connect the technology to real life. As I mentioned, a problem with technology and learning is that unless a third party makes the connection for the child from the virtual world to the real world, the lessons taught on a screen can get stuck in the game. During game play we connect via email to parents, grandparents, and educators to tell them what the kids are learning so they can reinforce the learning in real life as well.

That reinforcement is really the key issue. The advantage of this technology is that we can engage the kids. It’s easier to start a conversation when kids are interested in the topic – technology can provide that entrance not only to the knowledge, but to the conversation. The disadvantage is that if the lessons are not connected to real earning, savings, spending and sharing; it remains in game – the dots are there and it’s then up to us to connect them for the kids.

The debate of how to best learn will continue. I think it prudent to use all ways available and see what works for individual kids. The reality is that as technology advances, it is in our children’s’ best interest to explore how to best utilize the resources to compliment previously successful techniques.

But most important is to remember that this new technology is a tool, not a lone solution.

Making The Gamification Of Financial Literacy Work; image attribution flickr user 401k2013


How College Financial Aid Works

Financial aid is not an easy puzzle to solve, and a few facts seem to contribute to that complexity.

1. College is expensive
2. Young people can lack financial literacy
3. High school juniors and seniors are often consumed with admission requirements rather than money

For these reasons and more, college financial aid can remain murky for too many students in terms of what’s out there, applications processes–even the difference between a loan and a grant.

The following infographic helps to clarify some of the mess, and a few statistics stand out:

  • In 2007-2008 the average amount of aid received by students was $9,100.
  • In 2010-2011 the average amount of aid received by students was $12,400 out of which $6,500 didn’t need to be repaid.
  • Every year over 1.5 million qualifying students miss out on Pell grants because they didn’t fill out the FAFSA.
  • FastWeb lists more than 1.5 million scholarships worth more than $3.4 billion.

Infographic source: