Financial Literacy Fills the Middle School with Topics, Discussion, and More!
Saving and investing, long-term budgeting and financial planning, debt management, environmental stability…all of these topics (and more) were tackled last week when the folks from PricewaterhouseCoopers took over the Boulevard and Middle School classrooms to work with Speyer's students for the second session of this year's Financial Literacy curriculum. Moving beyond the "what" to the "how," each grade explored a different financial concept. We have all of the scoop from Speyer Parent Greg Peterson!
How much do you need to save to have a million-dollar nest egg at retirement? (It is closer than you think!) That’s what the fifth graders were asked as they learned about investing and saving, going in-depth to explore just how money "grows" when you invest it. Breaking down concepts such as investing and interest (both compound and simple), the students analyzed how saving a certain amount of money each day for a certain amount of time would increase with interest. They created a college savings plan as well as the aforementioned millionaire savings plan. Several fifth graders debated using a safe at home to save versus a bank and “trust issues.” One student suggested to the instructor if his college-age child was not saving, “Stop paying for his stuff and see what happens.”
The sixth graders analyzed something we use every day – a light bulb – as a way to explore the impact of purchase choices and the financial and environmental implications of energy efficiency. After discussing incandescent bulbs and LED bulbs and ways to measure energy, students then did a side-by-side comparison of how the use of incandescent and LED bulbs would affect them financially, as well as how these choices affect the environment. The topic was so “illuminating” that one student noted they leave the lights on all day and night and another was determined to remove all the LED bulbs out of their current apartment when they moved!
Meanwhile, seventh graders jumped right into their study of credit scores. From why it is important to establish a positive credit history to the value of credit reports to borrowers and to lenders, students came away with key knowledge about credit and debt. They also applied legal guidelines to determine permissible uses of a credit report other than granting credit and discussed ways that a negative credit report can affect a consumer's financial future. Pretty important questions arose, including “When you die, do your debts die with you?” and “Do college loans impact your credit score?” Taking the role of a credit manager, one student noted, “I would like to see a refreshed credit report to make a judgement on extending more credit to this person.”
The eighth graders asked and answered questions such as How do you make a budget? How do you plan financially for an emergency? Why is a budget important? and What are fixed expenses and variable expenses? as they began to learn the practical, yet essential skills of budgeting and financial planning. It was interesting to observe the students incorporating clothes and electronics into their budgets. One hotly debated topic was the question of philanthropy and whether this was a fixed or variable expense/investment, a necessity or luxury? The students made the point luxury goods make people feel better, therefore, as philanthropy can make one feel better, it must be a luxury but at the same time a necessity in life. Typically, this financial discussion is around the economics of budgeting and whether you budget for charitable giving or see what is left over to be available for giving. One student remarked, "I thought this was financial literacy and it seems like mindfulness".
Stay tuned for more updates soon on the Speyer Stock Challenge and the Financial Literacy Fund Portfolio!