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"First graders in Kim Britt's class at Richland Elementary in Memphis, Tennessee are not only learning about income, they're learning how to earn it. They're also being taught the difference between "needs and wants" and the "opportunity costs" of their decisions. The students are learning the importance of saving, budgeting, and entrepreneurship through the Smart Tennessee Program."
"Tennessee is one of only 13 states that requires students take a personal finance course to graduate from high school."
Does your state require students take a personal finance course to graduate from high school? What do you think of starting this type of education in first grade?
"First graders in Kim Britt's class at Richland Elementary in Memphis, Tennessee are not only learning about income, they're learning how to earn it. They're also being taught the difference between "needs and wants" and the "opportunity costs" of their decisions. The students are learning the importance of saving, budgeting, and entrepreneurship through the Smart Tennessee Program."
"Tennessee is one of only 13 states that requires students take a personal finance course to graduate from high school."
Does your state require students take a personal finance course to graduate from high school? What do you think of starting this type of education in first grade?
I don't really know what the graduation requirements are in my state because my kids are in private school. They are not required to take a personal finance course in their school although I know that the 6th grade teachers do teach some personal finance skills as part of their classes.
In my son's class they each have a checkbook register. They earn money by doing certain things and they spend money on others (treats, homework passes, etc.) They can also lose money if they do certain things.
The teacher says she implemented the checkbook registers when her daughter wrote a check for a Chik Fil A sandwich and bounced a check, eventually costing her something like $50 in total.
I think it's a great addition to the curriculum. In elementary school (a charter school) my sons did get some instruction in personal finance. They learned about needs and wants, interest, deposits and withdrawals, etc... This is ultimately a more useful skill than learning to pass the state tests.
That's awesome. Learning about finance is an invaluable experience. I remember two distinct experiences in grade school that help shape how I view money:
1. Enterprise City (or something like that). We took a field trip to this "City" (a really big building) and we all took on jobs, had checkbooks, breaks where we could buy stuff, earned money and we had to balance our checkbook account after every purchase. There were "necessities" I think that we had to account for and disposable income that we could spend. To this day, my check register has to come out perfectly or else I will keep figuring out where the difference is!
2. Earning "moolas" (i.e. play money) and having auctions every couple of weeks. We would earn moolas for various activities in class like good grades, helping the teacher, following directions etc. Every couple of weeks our grade level would have an auction (with stuff parents donated) and we could bid on stuff. You didn't want to spend it all at the beginning b'c the good stuff might not come 'til the end, or you could save up (like me!) until you had a LOT of money so you could get something really awesome. I thought it really empowered kids to learn about choices. Or at any rate, this experience from grade school really stuck out for some reason.
I've been a proponent for this for years! I think every student should have to take a course in financial literacy to graduate from high school. Thumbs up to Tenn. and the other 12 states!
Opportunity cost and economic choices are part of our social studies curriculum. Students know and understand these terms by the end of third grade. I know the economic studies builds upon prior knowledge each year, but I don't know if they need to take a personal finance course in the later grades.
I looked and to this excerpt from what students need for just a modified standard diploma: A student must take three (3) courses that include content from among applications of algebra, geometry, personal finance, and statistics.
We discussed this on this forum some time back, maybe even a couple of years ago. Anyway, I believed then, and still believe now, that you can teach personal finance till the cows come home, but until a young person has to actually support him/herself, it's all theoretical. I do think kids should be taught how to balance a checkbook, and a few simple things like that, but nothing much will sink in until they have their own apts and have to do everything themselves. I'd be interested to see the content of these "personal finance" courses.
We discussed this on this forum some time back, maybe even a couple of years ago. Anyway, I believed then, and still believe now, that you can teach personal finance till the cows come home, but until a young person has to actually support him/herself, it's all theoretical. I do think kids should be taught how to balance a checkbook, and a few simple things like that, but nothing much will sink in until they have their own apts and have to do everything themselves. I'd be interested to see the content of these "personal finance" courses.
I think that parents can teach this better.
Here is what we did. Starting at 4 or 5, my kids had small allowances they could spend on their own treats. If they ran out, then they didn't get the treat that day. They could also save for things that were more than their allowances if they wanted them. Allowances were always their money, not ours. Also, we did not pay for normal chores around the house, but we did sometimes pay for things we considered above and beyond the normal chores as they got older.
At school age, we started budgeting for their school lunches. They got the money at the beginning of the week. If they wanted to pack a lunch, they got to keep the lunch money for their treats and add that to their allowances. My ds rarely had hot lunch and saved the money to buy baseball cards. My dd liked hot lunch so she didn't have as much to spend.
Once they were older and taking the city bus, we budgeted for that as well as lunch money. My ds liked to walk or bike to school instead, so he often saved the money at that point. My dd, at that point did not like the school lunches anymore, so she saved that up. Both sometimes took the bus and sometimes walked. Both sometimes ate hot lunch and sometimes packed lunches. They learned to budget for many things out of this.
In high school, they started having a clothing budget. My son always spent his entire budget because he did not like to shop and would get the pants and shirts from the first store he was in. My dd, otoh, would shop at resale shops and even the Salvation Army store. She developed her own sense of fashion and style and saved up her money for cds and jewelry and her other hobbies.
In their junior and senior years of high school, they got checking accounts and began to save money from their after school jobs or babysitting or extra chores around the house that we paid for. They could manage these in any way they saw fit. Neither of them ever bounced a check and both were very responsible. We talked about spending for charity and saving for college and spending on *treats* but we never told them what they had to spend for. Both developed a very good sense of personal finance from this and they are quite successful at managing their adult incomes.
I agree that parents are the best ones to do the financial teaching. My DD said her financial guy told her (at age 25) that she managed her money well and asked her how she learned to. She told him she learned from Mom and Dad.
We did things a little differently than you, but it worked. She has a great credit rating and lives within her means.
The other one is only 23 but she, too, lives within her means and managed to save $7000 in less than a year with a $10/hr job by living at home. She has sinced moved out to her own apt.
Call me a skeptic, but I think there's some sort of collusion going on between the banks, financial institutions (who don't want kids literate in finance), textbook publishers, and the entire education complex in America.
1st - Why isn't it mandatory across all states? Doesn't that strike you as odd. Why only 13 states out of 50? Kids in california or nevada need just as much education as those in Tennesse. Do kids in Tennesse add differently?
2nd - There's been a massive increase in the last 15-20 years in predatory lending, and basically "Rip off lending" (i.e. 48 or 60 month auto leases). 30% on credit cards. Changes in grace periods, etc.
The details of finance that kids get into out of school are not taught in school. Messy details like how to compute interest. Or how to calculate different apr's, like one for cash advances, and one for purchases (which can have a difference of 10 or 15%). If your balance is $2,000 for purchases (at 12% apr) and $950 for cash advances (at 25% apr), how much is your monthly interest (finance) charge? What's your minimum payment? How long is it going to take you to pay it off?
Correct personal finance education should make kids leery about getting into certain financial traps. I think the ugly truth is, the banks and financial institutions in this country don't want kids literate and competent in the fine details of finance that they'll experience after school.
-Why don't kids learn about real estate? They're going to buy an apartment or house after graduating from school. Wouldn't it be better if they were well versed in the details and nuances of real estate before they met aggressive brokers or listing agents, or loan brokers that want them to put up 0% down.
I went to middle school and highschool in the 90's. It's funny when you talk about personal finance. *Nothing* that happened in the 2000's in personal finance, or finance, was discussed at all in school!
Subprime, derivatives, credit default swaps, the housing bubble, the dollar, the fraud on wall street, disgraced, idiot CEO's, accounting scandals, goldman sachs, etc. *Nothing*.
Either that's an amazing coincidence.....or, they simply didn't want you to know what was going on in the world. Much easier to have kids fill in bubble sheets about George Washington than know what was going on at Goldman Sachs.
I think it's fabulous that the Tennessee schools are doing this.
However, I think it's just another foisting of the parents' responsiblity onto the school system.
I will handle the financial advice in my family, thanks. You can teach 'em about sex.
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