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EVALUATED “BY EDUCATORS, FOR EDUCATORS.” THANK YOU
TO THE FOLLOWING EDUCATORS FOR DEVELOPING
COMPONENTS OF THIS LESSON PLAN.
10‐12
Anticipatory Set & Facilitation: 120 minutes
Conclusion/Assessment Options: 20‐60 minutes
Time does not include the vocabulary activity or potential modifications.
Tracey Newman, Family and Consumer Sciences Educator, Ste. Genevieve, Missouri
Margie Chinadle, Family and Consumer Sciences Educator, Rudyard, Montana
NATIONAL STANDARDS LESSON PLAN OBJECTIVES
The curriculum is aligned to the following national standards: National Standards for Financial Literacy American Association of Family and Consumer
Sciences Council for Economic Education National Business Education National Jump$tart Coalition Common Core English Language Arts
Upon completion of this lesson, participants will be able to: Evaluate the importance of saving money Assess the importance of developing financial goals
when saving money Analyze the trade‐offs and opportunity costs when
saving money Implement the pay yourself first strategy Summarize the time value of money concept Identify the benefits of compounding interest on
savings
MATERIALS
MATERIALS PROVIDED IN THIS LESSON PLAN
MATERIALS SPECIFIC TO THIS LESSON PLAN
BUT AVAILABLE AS A SEPARATE DOWNLOAD
MATERIALS TO ACQUIRE SEPARATELY
DEPENDING ON OPTIONS TAUGHT
My Savings Quest 2.4.1.A1
Take a Chance Tracking 2.4.1.A2
Choose to Save reinforcement worksheet 2.4.1.A3
To Save or Not To Save Essay Rubric 2.4.1.B1
Choose to Save Vocabulary List 2.4.1.E1
The Roommates: Saving Script 2.4.1.E3
Choose to Save Information Sheet 2.4.1.F1
Take a Chance Cards 2.4.1.H1
Choose to Save Note Taking Guide 2.4.1.L1
Choose to Save Answer Key 2.4.1.C1
The Roommates: Saving Prezi Presentation 2.4.1.E2
Choose to Save PowerPoint presentation 2.4.1.G1
Saving and Investing Unit Multiple Choice Test Bank & Answer Key 2.4.0.M1 & C1
Bingo markers (could be beans, buttons, glass rocks, etc.)
Children’s books about saving
Large bag of Jelly Beans (or other candies or markers) with a minimum of six colors
External resources referenced in this lesson plan: Consumer Jungle: www.consumerjungle.org
Saving Money in Plain English: www.commoncraft.com/video/saving‐money‐compound‐interest
TAKE CHARGE TODAY RESOURCES
Similar lesson plan at a different level: The Secrets of Saving 1.4.1
Optional lesson plan resources: Bingo Active Learning Tool 3.0.16 Children’s Book Integration Active Learning Tool
3.0.35 Penny Power Active Learning Tool 3.0.2 A Little Goes a Long Way Visual Aid 4.4.1 Time Value of Money Magic! Active Learning Tool
3.0.25 Time Value of Money Math Lesson Plan 2.4.2
CONTENT EDUCATOR MATERIALS PARTICIPANT READING
Materials to support educators when preparing to teach this lesson plan are available on the Take Charge Today website.
Choose to Save Information Sheet 2.4.1.F1
OPTIONAL ADVANCE INSTRUCTIONThis lesson is designed to be taught as a stand‐alone lesson. However, background content knowledge from the
following lesson plans is directly related to this lesson and may be helpful for participants.
Setting Financial Goals 2.1.4 Financial Decisions 2.1.3 Statement of Financial Position 2.2.3 Income and Expense Statement 2.2.4 Spending Plan 2.2.5 Getting Paid 2.3.9
LESSON FACILITATION
PREPARE
Visual indicators to help prepare the lesson INSTRUCT
Instructions to conduct the lesson facilitation CUSTOMIZE
Potential modifications to lesson facilitation
VOCABULARY ACTIVITY Activity that may be conducted before, during and/or after instruction depending upon the activity and needs of participants.
Bingo
Approximate time: 20 minutes prior to instruction and 20 minutes at the end Materials to prepare for vocabulary activity:
Bingo Active Learning Tool 3.0.16 o 1 Bingo‐ Side One and 1 Bingo‐ Side Two 3.0.16.H1 printed front to
12 bingo markers (could be beans, buttons, glass rocks, etc.) per person
Choose to Save Vocabulary List 2.4.1.E1
1 Choose to Save Information Sheet 2.4.1.F1 per participant
1. Conduct the Bingo activity – side one, definitions. Directions are included in the Bingo Active Learning Tool 3.0.16.
o The object of Bingo is for a player to have a row, column or clear their bingo board as a result of matching vocabulary words throughout the activity.
ANTICIPATORY SET OPTIONS There are two anticipatory set options provided for this lesson. 1. Option 1: Children’s Book Integration 2. Option 2: Penny Power
Option 1: Children’s Book Integration Approximate time: 30 minutes (depending on the number of groups) Materials to prepare: Children’s Book Integration Active Learning Tool 3.0.35
o 1 Money Stories 3.0.35.A2 per participant 1 children’s book about saving per 3‐4 participants. Examples include:
o The Tale of the Tortoise Buffett by Lucas Remmerswaal – Participants learn about the role money plays in life including making your money work for you.
o If You Made a Million by David Schwartz – Participants learn about spending, saving, interest, borrowing, and lending.
o One Grain of Rice by Demi – Participants learn about the time value of money.
o A list of additional savings books is available in the Children’s Book Integration Active Learning Tool 3.0.35
1. Divide participants into groups of 3‐4. 2. Complete the Option 2: Graphic Organizer activity as described in the
Children’s Book Integration Active Learning Tool 3.0.35.
Option 2: Penny Power Approximate time: 15 minutes Materials to prepare:
Penny Power Active Learning Tool 3.0.2 o Penny Power PowerPoint presentation 3.0.2.G1
1. Conduct the Penny Power demonstration as instructed.
a. Penny Power introduces the concept of compounding interest by showing the power a penny can have if doubled every day.
RECOMMENDED FACILITATION
If time is limited, choose one children’s book and conduct a class discussion. Tips are provided in the Children’s Book Integration Active Learning Tool 3.0.35.
Increase the number of terms available by using vocabulary lists from topics that supplement this lesson including goal setting, financial decisions, income and expense statement, etc.
PowerPoint Presentation Approximate time: 90 minutes Materials to prepare: Choose to Save PowerPoint presentation 2.4.1.G1 1 My Savings Quest 2.4.1.A1 per participant Time Value of Money Magic! Active Learning Tool 3.0.25
o Large bag of Jelly Beans (or other candies or markers) with a minimum of six colors
o 2 clear containers (Ziploc sacks, clear bowl, graduated cylinder, clear piggy bank, etc.)
o Time Value of Money Magic PowerPoint presentation 3.0.25.G1 Present the Choose to Save PowerPoint presentation 2.4.1.G1. Split participants into groups of two to three. Participants will work in small groups to discuss prompts as presented in the PowerPoint. Part 1: What is Saving? 1. Slide 1: Choose to Save 2. Slide 2: What is Saving?
a. Saving is an essential part of a financial plan. 3. Slide 3: Why Save?
a. Without savings, a household may not have the money to pay for an unanticipated expense, regardless of their income.
b. Saving may be used for short‐term goals for expenses that aren’t typically a part of a spending plan such as a vacation or new furniture.
c. In groups, brainstorm examples of emergency expenses. Examples include:
i. Automobile repair ii. Medical emergency
4. Slide 4: Saving Reduces Financial Risk and Uncertainty a. Remind participants of the curriculum principle, investing helps you
cope with risk and uncertainty. By having saving, individuals reduce their financial risk.
b. In groups, brainstorm examples of monetary assets they might have. Answers may include:
i. Cash ii. Saving account iii. Checking account
5. Slide 5: How Much Money Should Be Saved? a. Six months of expenses is recommended to provide financial security
or for loss of income. However, the exact amount varies for each individual.
b. This is accomplished by saving 10‐20% of net income each time money is received.
6. Slide 6: Saving on an Income and Expense Statement a. On an income and expense statement, saving is both an expense
(when an individual saves) and a form of unearned income when an individual uses money saved to pay for an expense.
7. Slide 7: My Saving Quest Part 1
The Choose to Save Note Taking Guide 2.4.1.L1 is provided but not included as part of the recommended facilitation instructions or approximate time.
Show the “Saving Money in Plain English” clip from the Common Craft website to explain the concept of compounding interest.
Give each group a white board to document their discussion.
a. Provide each participant with My Saving Quest 2.4.1.A1. This worksheet will be completed individually throughout the lesson.
b. Instruct participants to brainstorm three items of monetary value that would be on their wish list.
c. Have particpants estimate how much each item would cost to purchase.
d. Ask participants if they have enough money today to purchase all of the items on their list. Typically, individuals do not and must prioritize what they would like to save for.
e. Ask participants to place a star next to the item they would like to start saving for today.
Part 2: How to Save Money 8. Slide 8: Identifying Money to Save
a. Reducing or eliminating large, monthly expenses result in greater saving. However, these expenses are often contractual which makes them harder to change and is why individuals should carefully evaluate the short and long‐term implications of signing any contract.
b. In groups, brainstorm ways to reduce spending. Examples include: i. Cancel/reduce television ii. Use public internet rather than paying for it at home iii. Eat out less iv. Purchase in bulk v. Walk, ride a bike or use public transportation vi. Don’t make impulse purchases
9. Slide 9: Identifying Money to Save a. Sometimes, decreasing expense is not a realistic option. In this case,
individuals should explore ways they can increase their income. b. Another way to reduce expenses is by doing things yourself rather
than paying for a service. However, an individual must consider if they have the time and skills required to complete do it yourself tasks.
c. In groups, brainstorm what they can do themselves to save money. Examples include:
i. Eat at home and/or cook rather than purchase convenience foods
ii. Do your own transportation and housing maintenance and repairs
iii. Do your own cleaning 10. Slide 10: Create a Savings Plan
a. Saving is achieved by setting financial goals. Goals help you to identify a reason for saving.
b. There are many resources, including tablet applications, to help individuals set and track goals including:
i. Websites ‐ Piggy Mojo and Stickk ii. Spending plan programs –Mint iii. Programs offered by depository institutions
11. Slide 11: Make Sure Your Goal is Realistic a. If goals are not realistic, they will not be achieved.
b. Ask participants to think about what they would give up to receive the item on their wish list. This is a trade‐off.
c. Then, ask participants to think about the value of the item they are giving up. This is their opportunity cost.
d. Opportunity cost helps an individual analyze what matters to them most in order to decide what trade‐offs to make.
e. Ask participants to discuss, in groups, why saving can be difficult. i. Saving requires that individuals give something up in the
present to have money for the future. ii. For saving goals to be realistic and attainable, an individual
must carefully consider the trade‐offs and opportunity cost of what they are giving up in the present.
12. Slide 12: My Saving Quest Part 2 a. Have participants refer back to their My Saving Quest 2.4.1.A1. b. Have participants think about their current individual income and
spending. Instruct them to identify at least three ways they could either increase their income or reduce their expenses today.
c. For each change, have participants identify one trade‐off they will be making.
d. Have participants place a star next to items with a realistic opportunity cost.
Part 3: Making Saving Automatic 13. Slide 13: Pay Yourself First
a. Emphasize that the savings choices they make today will impact their future.
b. The most effective way to pay yourself first is to make the process automatic by using tools such as automatic depository institution transfers or payroll deductions
Part 4: Time Value of Money 14. Slide 14: Saved Money Provides for Your Future Self
a. Money saved can increase in value because of the time value of money. The potential to earn interest.
15. Slide 15 and 16: What is Interest? a. Interest can be paid (such as credit) or earned (such as saving). b. Individuals should save money in a depository institution account that
earns the highest interest rate possible while still being low risk and liquid.
c. Compounding interest is what makes the time value of money work. d. An additional $225 in interest is earned when saving $1000 at a 5%
interest rate rather than a 1% interest rate for five years. 16. Slide 17: How does Time Affect the Time Value of Money?
a. Stress that the longer an individual saves money for, the more time money has to increase in value because of compounding interest.
b. Point out how much more Savannah’s parents had to save ($350/month) to reach the same savings goal.
c. Felix’s parents earned $8,856 in interest and Savannah’s parents only earned $2,676 in interest because they started later.
Use the A Little Goes a Long Way Visual Aid 4.4.1 to illustrate the Time Value of Money.
If a further math emphasis is desired, complete the Time Value of Money Math Lesson Plan 2.4.2 at this point in instruction. This lesson focuses on the math and calculations of simple and compounding interest.
17. Slide 18: How does Money Affect the Time Value of Money? a. Individuals should continue adding to their principal through ongoing
saving to maximize the interest being earned. 18. Slide 19: Time Value of Money Magic
a. Complete the Time Value of Money Magic! Active Learning Tool 3.0.25 as a visual demonstration that corresponds with the Time Value of Money Magic slide. The demonstration utilizes colored jelly beans to show how compounding interest works.
19. Slide 20: Maximize Your Return a. Discuss how participants can use time, money, and interest rates to
take full advantage of the time value of money and maximize their return.
20. Slide 21: My Saving Quest Part 3 a. Have participants refer back to their My Saving Quest 2.4.1.A1. b. Based upon their assessment of changes they can make to increase
income or decrease expenses and how realistic these changes are, have participants identify how much they could realistically save each week.
c. Have participants write a financial goal to make their saving plan actionable.
d. Ask participants to also identify one way they will make their saving process automatic.
21. Slide 22: Savings is an Essential Component of a Financial Plan
CONCLUSION OPTIONS There are two conclusion options provided for this lesson. 1. Option 1: Bingo 2. Option 2: Take a Chance
Option 1: Bingo Approximate time: 20 minutes Materials to prepare:
Bingo Active Learning Tool 3.0.16
1 Bingo‐ Side One and 1 Bingo‐ Side Two 3.0.16.H1 printed front to back per person (found in the Bingo Active Learning Tool 3.0.16)
12 bingo markers (could be beans, buttons, glass rocks, etc.) per person
Plastic bag or bowl
Choose to Save Vocabulary List 2.4.1.E1 1. Conduct the Bingo activity – side two, using the word. Directions are included
in the Bingo Active Learning Tool 3.0.16.
Option 2: Take a Chance Approximate time: 45 minutes Materials to prepare: 1 Take a Chance Tracking 2.4.1.A2 per participant Take a Chance Cards 2.4.1.H1 – 1 card per participant 1. Provide each participant with a Take a Chance Tracking 2.4.1.A2. 2. Part 1: My Income by indicating that they work at Indulgence Bakery and this
The graph in the PowerPoint can be used as a standalone demonstration if time and supplies do not allow for the completion of the jelly bean demonstration.
Use the Consumer Jungle website to access a variety of online games about saving.
is their paycheck stub. Their challenge in this activity is to analyze their spending and saving habits.
a. Have them record their paycheck information in the actual column on the income and expense statement.
3. Part 2: My Spending. a. Point out that column one in their income and expense statement
is their spending plan. b. Have them complete the income and expense statement as
instructed. Have participants color code similar categories to simplify calculations when determining the total expenditure for each category.
c. Have participants reflect on their spending habits and analyze the tradeoff’s to changes they would make if they wanted to start saving for a financial goal by completing the reflection questions.
4. Part 3: Take a Chance a. Let participants know that it is the end of the month and an
unexpected event has occurred. Distribute one Take a Chance Cards 2.4.1.H1 to each participant and have them record their event.
5. Part 4: Reflection a. Instruct participants to complete the Part 4: Reflection Questions
to determine how they would have paid for that expense considering their current Income and Expense Statement.
6. Discuss the reflection questions as a class.
ASSESSMENT OPTIONS There are three assessment options provided for this lesson. 1. Option 1: Reinforcement Worksheet 2. Option 2: To Save or Not to Save 3. Option 3: Elementary Education
Option 1: Reinforcement Worksheet Approximate time: 20 minutes Materials to prepare: 1 Choose to Save 2.4.1.A3 per participant 1. Complete the Choose to Save 2.4.1.A3 reinforcement worksheet.
Option 2: To Save or Not to Save Approximate time: 30 minutes Materials to prepare: The Roommates: Saving Prezi Presentation 2.4.1.E2 1 To Save or Not Save Rubric 2.4.1.B1 per participant 1. Share the story of Hannah and Morgan using The Roommates: Saving Prezi
Presentation 2.4.1.E2. 2. Participants will write a short essay about what advice Morgan would give
Hannah about managing her money. Provide each participant with a To Save or Not Save Rubric 2.4.1.B1 with the writing assignment.
Simplify the activity by providing participants with a completed Income and Expense Statement and focus on the Take a Chance discussion (steps 4‐8).
Provide participants with envelopes with play money representing their spending plan. They must remove money from their envelopes to account for all expenses to determine how much money they have available for their Take a Chance card.
The Roommates: Saving Script 2.4.1.E3 is available to have participant work in small groups rather than using the Prezi.
What are three things on your personal wish list? Include anything of monetary value. Approximately how much does each item cost? Place a star next to the item you would like to start saving for today.
Part 1: My Income Congratulations, its payday! You work full‐time at Indulgence Bakery earning $10.25 per hour and working 40 hours per week. You are paid monthly with direct deposit into your depository institution account. Use your paycheck stub to enter your gross income and deductions on your income and expense statement.
Employee Information Pay Date: 6/11/2013
Name Identification Number Address Pay Rate Pay Period
Your Name 00112233 Your Address $10.25 5/1 – 5/31/2013
Part 2: My Spending 1. You used an application on your phone to create an electronic list of all expenses. Identify the category
each expense would be in the income and expense statement. 2. Use this information to update your actual spending column on your income and expense statement. 3. Once you have entered all of the income and expenses, calculate the expense total and net gain or loss. 4. Calculate the difference for each category in the difference column on your income and expense
statement.
Company Amount Income and Expense Statement Category
Where I Live $325.00
Town and County Grocer $25.30
Keep the Lights On Utility Company $48.20
Quick Stop Fuel $48.90
Edwards Pizzeria $13.50
Pro Sporting Events $52.00
Love to Drive Auto Sales $160.00
Keeping Your Car Insured $42.00
JJ’s Trendy Clothing $48.00
Town and Country Grocer $84.60
Talk all Night Communications $70.00
Savings Account $40.00
Quick Stop Fuel $52.70
The All‐Inclusive Convenience Store $17.38
Town and County Grocer $32.00
The Mongolian BBQ $23.50
Hearts and Homes Charity Donation $50.00
Reflect on your May Income and Expense Statement: 5. How much, if any, money did you have left at the end? What would you use that money for?
6. You have realized that you want to start saving an additional $45 each month for a new tablet. What are at least two ways you would adjust your current spending to free up the $45? What are the tradeoffs to each spending adjustment?
Directions: Match the correct term with the correct definition by placing the letter on the appropriate blank. 1. _____ How quickly and easily assets can be accessed and converted into cash. 2. _____The price of money. 3. _____The portion of current income not spent on consumption. 4. _____Everything an individual or household owns with monetary value. 5. _____A measurement of how much a person or household owns once
all debts have been paid. 6. _____The percentage rate paid on money invested or saved. 7. _____The original amount of money saved or invested. 8. _____The end result of something a person intends to acquire, achieve, do,
reach, or accomplish. Directions: Fill in the blank to complete each statement. 9. A saving strategy that states to set aside a predetermined portion of money for saving each time a
person is paid before using any of the money for spending is called:_____________ ______________
________.
10. A _________ __________ is giving up one thing for another.
11. _____________ ____________ is the value of the next best alternative that must be forgone as a
result of a decision.
12. Earning interest on interest is _________________ ___________________.
Directions: Answer the following questions by writing a short answer. 13. Describe how to use each of the factors affecting time value of money to maximize the amount of savings
earned. (3 points)
Time
Money
Interest Rate
14. Why do experts suggest that your emergency savings be in a very liquid savings tool? 15. Explain why “pay yourself first” is an essential component of personal financial management.
16. What are three ways people can find money to save?
17. Why is it important to set goals when saving? Directions: Determine if each statement is true or false and indicate T for true and F for false. 18. _____It is important to consider opportunity cost and trade‐offs when determining how to save money. 19. _____Experts suggest that emergency savings equal to 6‐9 months of a person’s expenses be held in
liquid assets for unplanned events. 20. _____The longer an individual invests money for, the more compounding interest accrues. 21. _____An important part of the savings process is to write a savings goal. 22. _____It is important to have a low interest rate when saving.
23. _____Savings is an investment asset on the Statement of Financial Position.
Directions: After learning about Hannah and Morgan, imagine that you are Morgan. Hannah is telling you about her financial situation and asking for your advice. Write what Morgan might say to Hannah to explain the importance of intentionally saving money in a savings account.
In your conversation with Hannah, describe why these concepts are important and how they relate to saving:
Opportunity cost Trade‐offs Emergency fund Setting SMART financial goals
Provide at least two strategies Hannah may implement today to begin saving.
Exemplary Satisfactory Unsatisfactory No Performance
Score
Content: Opportunity cost, trade‐offs, emergency
fund and financial goals are all described At least two savings strategies are
identified Answer are thoughtful, reflective and
accurate
9‐7 6‐4 3‐1 0
Writing Skills: Sentences are fluent and effective Very few errors in mechanics,
punctuation and word choice Essay includes an introduction, body, and
conclusion
6‐5 4‐3 2‐1 0
Effectiveness of Presentation: Clearly prepared Easily read and neatly assembled Minimum of one‐page, double‐spaced