Teach Financial Literacy Through Mathematics
Students need to learn the important life skill of managing money.
In August, I was fortunate enough to be invited to participate in the “2010 Numeracy and Financial Education Summer Institute,” sponsored by the FINRA Investor Education Foundation and Drexel University’s Math Forum. Math educators and financial experts met for three days to collaborate on ways that math teachers could teach financial literacy as part of their mathematics curriculum. As recent news reports and surveys show, financial literacy is an important topic to discuss.
For instance, to the question: “When you retire, do you think you will have enough money to live comfortably, or not?” 52% responded “No, not enough,” in a recent Gallup poll. Math teachers can help by having students start thinking about their retirement in middle school and high school. This could start with a discussion about how much money students think they will need to live comfortably in retirement. Students could also consider: What job will they need and how many years will they have to work? How much money will they have to put aside each year or month to retire? What are their investment options?
“Retirement is a long way off for students, but they understand what you make/have means. These habits start at a young age,” according to Glenys Martin, a Canadian middle school teacher who attended the summer institute. “Developing spending plans as a financial habit will send young people off with an important life lesson.”
“Understanding the mathematical principles behind financial decisions can empower one to avoid financial schemes and to develop a sound financial plan,” according to institute attendee Stacey Seeger, a teacher from Salt Lake City, Utah.
And there are more lessons that math teachers can help teach. “Financial know-how” is the most important life lesson to teach children according to more than half (51%) of parents who answered a survey released by Bank of America this summer. According to the survey, the lessons that these parents believe are most important to pass on to their children are:
· The importance of managing a budget (42%)
· Investing for retirement ahead of time (32 %)
· Managing a checking or saving account (30 %)
· Managing and paying down debt properly (25%)
Interestingly enough, many of these same topics were discussed and promoted by teachers and financial experts at the 2010 Numeracy and Financial Education Summer Institute. Here are some more lessons to help make students more financially literate.
Financial Literacy Lesson Plans:
Budgeting, savings, financial management, opportunity cost, and self-regulations are all topics students learn about in this financial lesson. Role playing and web-based planning intertwine for students to apply their knowledge of finance components.
Students discuss and define the terms “spend,” “save,” “donate,” and “invest” and then relate these terms to their personal use of money. Students also create financial plans and graphs to show representations of their decisions.
Students consider the importance of short, medium, and long-term financial goals and learn how to make smart money choices. Worksheets on the pros and cons of financial incentives, spending goals, and a reflection of their goals accompany this lesson.
In this service learning lesson, students explore the concept of philanthropy as well as the world of personal finance more generally.
In this financial management lesson, students apply mathematics to real-life financial situations through role play and online resources.
In this credit lesson, students participate in interdisciplinary activities that include math problems, reading, and economics--all connected to becoming a better consumer and being able to make good credit choices.
The importance of money and budgets is highlighted in this lesson. Students use newspaper ads to “go shopping” and purchase items within their budget. They then reflect on how they made their choices as well as what creating a budget entails.
Students explore what economic security means in their own community and at the national level within this lesson. Students conduct research, analyze data, and draw conclusions concerning high priority economics issues in their community.