Standards

Personal Finance Is A Lot Like Relationships

 

Matt Gherman photo Personal Finance Is A Lot Like RelationshipsWritten by: Matthew Gherman 11/12th Grade Teacher of AP Economics, American History, ELL Global History at Edward R. Murrow High School, Brooklyn, NY. Matthew received the 2015 Alfred P. Sloan Foundation Teaching Champion Award.

 

Personal finance is a lot like relationships. They’re both taboo subjects in which everyone professes their advice and expertise, but in reality each is a very imprecise science. For high school students, these two topics are numbers one and two in terms of their curiosity (personal finance is probably a distant, but strong, second place). The curiosity and eagerness that surround this topic are what makes it fun to teach.  Students are familiar with many of the terms: interest rates, stocks, bonds, checking account, credit cards, credit score; yet there is so much room for exploration and enlightenment. For both finance and relationships there is wisdom that would be helpful to know at the age of 18, but is only earned from life experience. Therefore, the best approach to teaching the subject incorporates knowledge learned by trial and error, paving the road for the next generation.

Also at the age of 18, these are topics that might seem far away, but really they are much closer and include situations that students need to be ready for.  Students need to understand that their credit score is their life GPA, and they need to start building it now and learning how to build it now.  At 18, they can open up an investment account and learn how to begin to grow their money at a rate faster than a savings account. They need to begin building that big savings for important purchases that will all possibly come within a decade: college, car, apartment, engagement ring, marriage, home and children.  Many of these are concepts that they probably shrug at as “not my problem now,” but that decade goes by fast, and with it a lot of missed opportunity to improve their futures. The savings and investing which will make each stage of their lives easier starts at 18 (or even earlier) and the teacher is the provider of all of this information. The questions and enthusiasm that they bring to class enhance the teaching experience exponentially.

The ease with which these topics can be differentiated is also a great selling point for teaching it. Depending on student strengths, your lessons can range from just reviewing the basics to dissecting and debating scholarly articles and evaluating political implications. There is also opportunity for independent research, web-quests and presentation projects which add a different flavor to the class.  Additionally, teachers aren’t limited by being shackled to a state test at the end of the year. This subject allows creativity for both teachers and students.

Personal finance is strongly connected to the civic responsibility of voting. So many times politics is reduced to sound bites, preying on an uneducated class of voters. There are many social political issues that are shades of gray and fun to debate, but ultimately, the questions all students should have on their minds are what does the government do with our money and what are the implications of government actions on our wages, healthcare, investments, mortgages, and income taxes. Teaching personal finance creates a better informed and responsible citizenry.

The most important aspect of teaching personal finance is that these are life skills. This is the most useful course that students will take in high school because it will help them to be college ready, career ready, and life ready.

POSTED: April 5, 2016 | BY: April Somboun | TAGS: , , , , , ,

Council for Economic Education Introduces K-12 National Standards for Financial Literacy

The Council for Economic Education (CEE) is pleased to introduce the National Standards for Financial Literacy, a framework for the body of knowledge and skills that should be contained in a K-12 personal finance curriculum. Developed by a team of experienced and talented economists, education specialists at Federal Reserve banks, and financial education researchers, the National Standards for Financial Literacy raise the bar for financial literacy education.

The standards contain the six areas of knowledge and understanding that are fundamental to personal finance: Earning Income; Buying Goods and Services; Using Credit; Saving; Financial Investing; and Protecting and Insuring.  Each standard emphasizes decision-making skills by explicitly relating planning and goal setting, financial decision-making, and assessing outcomes to each standard. Through the standards, students learn how their personal situations and preferences affect their financial decision making, while beginning to understand the trade-offs inherent in every choice they make.  In the end, more informed choices lead to better choices as well as greater satisfaction with the choices that are made. Read more…

POSTED: April 16, 2013 | BY: admin | TAGS: , , , , , , , , , , ,

CEE in the News: Financial literacy can help deflate the growing student loan debt bubble

CEE’s Survey of the States was once again utilized as the backbone of support for economic and financial education in our nation’s schools.

In last week’s USA TODAY, Sabina Bharwani and Carrie Sheffield encourage K-12 education in economics and personal finance to prevent the ever-climbing student debt from reaching uncontrollable proportions.

“Teaching personal finance, economics and business in schools is a fundamental task in our hypercompetitive world, yet too few of our schools are on board. In 2011, just 22 states required a high school course in economics and just 14 states required the offering of a course in personal finance, according to research from the Council for Economic Education (CEE). These classes offer a solid foundation for studying our ever-globalizing world and guidance on dealing with tempting credit card offers hitting students’ mail boxes at age 18.”

Read their full column here.

POSTED: January 14, 2013 | BY: admin | TAGS: , , , , ,

CEE in the News: Tackling Investor Ignorance in The Wall Street Journal

Our global economy has become so complex that the gap between what people know about economics and personal finance, and what they need to know, is widening every day. Americans are increasingly responsible for their financial future, yet an alarming number lack even basic economic awareness.

In Karen Blumenthal’s article for The Wall Street Journal, Tackling Investor Ignorance, she dissects the latest report from the securities and Exchange Commission on personal finance for Americans. The conclusion? Not great.

From the article:

“Small investors, the SEC said, “have a weak grasp of elementary financial concepts and lack critical knowledge of ways to avoid investment fraud.

That’s a problem for individuals if they buy products they don’t understand, accumulate too much debt or take unintended risks with their retirement funds or other savings.”

So where does the Council for Economic Education fit in? How do we fix the problem?

“Still, people can’t be experts about every financial product or investment. So what exactly do they need to know to make good decisions?

Plenty of experts have been wrestling with this. The nonprofit Council for Economic Education is working on standards for students in fourth, eighth and 12th grades in six main subject areas: earning income, buying goods and services, saving, using credit, investing and protecting and insuring assets.”

Dr. Annamaria Lusardi, CEE Board Member and professor of economics and accountancy at George Washington University, and Bill Bosshardt, Director of the Center for Economic Education at Florida Atlantic University both weighed on the full article here.

POSTED: November 5, 2012 | BY: admin | TAGS: , , , ,

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