Author:
MBA Research and Curriculum Center
Subject:
Career and Technical Education, Business and Information Technology, Marketing, Management and Entrepreneurship
Material Type:
Lesson Plan
Level:
Middle School, High School
Tags:
  • Be Financially Smart
  • Budget
  • Budgeting
  • Classroom Activities
  • Developing a Budget
  • Finance
  • Financial Literacy
  • Financial Planning
  • Lesson Plan
  • Personal Financial Literacy
  • License:
    Creative Commons Attribution Non-Commercial No Derivatives
    Language:
    English
    Media Formats:
    Downloadable docs

    Education Standards

    Be Financially Smart - Lesson Plan

    Overview

    Lesson Objective:

     

    At the completion of this lesson, students will be able to create a budget to accomplish personal financial goals. 

    Supplies Needed:

     

    Student Handout 1

     

    U.S. Saving and Spending Web Quest (found in Task 1 and Task 2)

     

    Student Handout 2

     

    Fast-Forward: Life in 10 Years – A Planning Activity (Found in Task 3)

     

    Student Handout 3

     

    Personal Finance Public Service Announcement Rubric (found in Task 4)

     

    Student Handout 4

     

    FoolProof: Personal Finance Company’s Guide to
    Monthly Budgeting (Found in Task 5)

     

    Student Handout Answer Key 4

     

    FoolProof: Personal Finance Company’s Guide to
    Monthly Budgeting (Found in Resource Library)

     

    Student Handout 5

     

    Personal Finance Decisions (Found in Task 6)

     

    Student Handout 6

     

    What’s Your Budget? (Found in Task 7)

     

    Student Handout 6 Answer Key

     

     

    What’s Your Budget? (Found in Resource Library)

     

     

     

    References

     

    Econedlink: Council for Economic Education. (n.d.). Economic Glossary. Retrieved from http://www.econedlink.org/economic-resources/glossary.php


     

    Introduce the concept of saving, spending, and budgeting.

    Distribute the handout entitled "U.S.Saving & Spending Web Quest." Have students create a short list of items that they would like to purchase but cannot afford given their current financial situation in the area titled “wish list” on the handout entitled "U.S. Saving & Spending Web Quest." Ask students to share some of the items on their list. Student responses may include simple items like clothing, electronics, or jewelry. There may also be some responses that include expensive items like vehicles or housing.

    Complete the "wish list" portion of the handout entitled "U.S.Saving & Spending Web Quest." Be prepared to share your responses with the class. 

    Ask some students to offer their own definition of the term "budget." You may also want to ask if any students have experience in budgeting. Have students write down the following definitions in the space provided on the handout.

    Budget: An estimate of income and expenditures over a certain period of time.
    Long-Term Goal(s): Objectives that will take a year or more to reach.
    Short-Term Goal(s): Objectives that take less than a year to achieve.

    Discussion #1: How do you get the money necessary to buy the items that you want? Do the items that you listed fall under short-term or long-term goals?

    The discussion should help the students understand that people set goals for purchases much like we set goals for grades, athletics, careers, and life in general.

    Discussion #2: What things must a person consider when devising a plan to be financially responsible?
    Possible answers: their income, their expenses, their personal needs, food, shelter, clothing, and their short and long term goals.

    Share your definition of the term "budget" and discuss the concept of budgeting with the class. 

    Assess awareness of budgeting

    Using the handout "U.S. Saving and Spending Web Quest," have the students list as many personal characteristics that they can think of that would lead to successful budgeting and reaching short-term and long-term financial goals. They will list these characteristics under the column titled “brainstorm.”

    Below are some characteristics the students may not think of and should add to the “suggested” column of Student Handout 1: U.S. Saving and Spending Web Quest:

    • Disciplined
    • Prioritizing
    • Realistic
    • Mathematical minded
    • Conservative
    • Good spending habits
    • Creative
    • Hard working
    • Resourceful

    List as many personal characteristics that you can think of that would lead to successful budgeting and reaching short-term and long-term financial goals. List these characteristics under the column titled “brainstorm.” 

    Review the directions for the Web Quest on the "U.S. Saving and Spending Web Quest" handout with students. The websites listed will have all of the information a student needs to complete the assignment. NOTE: Because the data will vary from year to year, the teacher may want to create a new answer key each year.


    1. Have students predict the answers to each challenge listed on both pages.
    2. After the predictions have been completed, ask students to share their predictions.
    3. Have students complete the Web Quest on page two of  "U.S. Saving and Spending Web Quest."

    Discussion #3: What did you learn after performing the research and recording the spending and saving data? Do our spending and saving habits have an impact on our economy?
    Possible answers: Students will likely discover that each generation of Americans struggles with a balance of spending and saving. Many are borrowing too much and saving too little. When many people lose their source of income, there is not enough savings to live on. When people have no money, they turn to the government for help. Many may also observe that our own government spends more than its income.

    Predict the answers to the challenges listed on the handout "U.S. Saving and Spending Web Quest." Share them with the class. Then, complete the Web Quest. 

    Complete budgeting activity

    Distribute the handout entitled "Fast Forward: Life in 10 Years – A Planning Activity." Divide the class into five groups and assign each group a level of education. Review the directions at the top of the handout. Each level of education includes a monthly salary and a student loan payment. These two amounts will be added to the budget worksheet. Child care is not included in expenses. This activity is based on a single person. Have students calculate the amount of money they wish to save first. If you calculate the savings last, you may find that there is little or nothing left to save. Many experts suggest a person to save at least 10% of their income. The students are now faced with choices – housing, groceries, transportation, energy, communications, and other spending options. Have the students work through the remainder of the budget worksheet. 

    At the end of the activity, ask the students to add their savings and their expenses. In the end, the students must be sure that the savings and expenses are less than the monthly income. The student must return to the planning worksheet and make adjustments if their savings/spending exceeds the monthly income.

    Discussion #4: What did you experience when working through the monthly budget activity? What was easy? What was difficult? How was the activity different between the varying levels of income?
    Possible answers: Budgeting can be much more of a challenge when you are working with less income. The less income you have, the more you have to focus on needs rather than wants. The more income you have, the more apt you are to spending and this habit can become troublesome, because the more money we make, the more we seem to spend rather than save.

    Discussion #5: Do you think that American families are working through a monthly budget like you have just completed? Why or why not?
    Answers to this question may vary. Some students may believe that this activity is common, while some may think it never happens. (The response will likely involve the students’ experience with personal finance at home). If the students make a connection with the Web Quest Activity, they’ll likely suggest that budget building is not common, or at least adherence to an established budget is not happening in our society. 

    Your teacher will assign you to a group and assign your group a level of education. Review the directions at the top of the handout entitled "Fast Forward: Life in 10 Years – A Planning Activity.". Each level of education includes a monthly salary and a student loan payment. These two amounts will be added to the budget worksheet. Child care is not included in expenses. This activity is based on a single person. Calculate the amount of money you wish to save first. If you calculate the savings last, you may find that there is little or nothing left to save. Many experts suggest a person to save at least 10% of their income. You are now faced with choices – housing, groceries, transportation, energy, communications, and other spending options. Work through the remainder of the budget worksheet. 

    Add your savings and their expenses. You must be sure that the savings and expenses are less than the monthly income. Return to the planning worksheet and make adjustments if your savings/spending exceeds the monthly income.

    PSA Activity

    Prior to instructing the students, locate examples of local and statewide Public Service Announcements (PSA). Divide students in groups of three to five. Distribute the handout entitled, "Personal Finance Public Service Announcement Rubric." Review directions with the students. Each group should record a personal finance PSA for the class. “Fair Use” is a rather complicated copyright law. The students must create original works or gain permission for the use of any video, audio, or texts they use in the project. Use the rubric to evaluate students' work.

    Your instructor will divide you into groups. Record a personal finance PSA for the class. You will be evaluated using the rubric provided.

    Create a Guide for Budgeting

     Distribute the handout entitled "A Guide to Creating a Strategy for Earning, Saving, Spending and Investing." For this activity, students must use some form of presentation software. (Microsoft PowerPoint, Google Presentation, Prezi, or other) Students are to create a step-by-step guide to building a budget. Students must define key terms from the lesson in their own words. The definitions for the key terms can be found in the FoolProof Personal Finance Company’s Guide to Monthly Budgeting Answer Key in the Resource Library. Students will use a minimum of three images. The total points available and penalty assessments have been left blank. The teacher may determine how many points the assignment is worth and how many points to deduct for errors. Students must demonstrate fair use or gain permission to use graphics obtained outside of their presentation software. Students should perform peer editing to ensure there are no mistakes in spelling, grammar, and punctuation.

    Create a step-by-step guide to building a budget using presentation software. Define key terms from the lesson in your own words. Use a minimum of three images. The total points available and penalty assessments have been left blank. Demonstrate fair use or gain permission to use graphics obtained outside of their presentation software. Perform peer editing to ensure there are no mistakes in spelling, grammar, and punctuation.

    Demonstrate understanding

    Distribute the handout entitled "Personal Finance Decisions." Read the Financial Situation with the students and have them respond to each of the given scenarios. Have the students share their answers.

    Complete the handout entitled "Personal Finance Decisions."

    Assessment - Handout

    Distribute the handout entitled "What’s Your Budget?" Use the answer key in the Resource Library to correct student work.

    Complete the handout entitled "What's Your Budget?"