Half of all high school seniors have ATM cards.
30-percent use at least one credit card.
But only 20-percent of teenagers have had any formal instruction in personal finance by the time they graduate.
An eighth grade math teacher in New Hampshire has found a creative way to teach math and give students a financial education.
New Hampshire Public Radio’s Amy Quinton reports.
Most of the seats in Pete Bowler’s eighth grade math class at Rundlett Middle School in Concord are filled with students.
Bowler says not many students are ever absent, because he pays them to come to class -- just like it’s a real job.
(They each get a checkbook, they start off with a thousand dollars and they get paid, the amount they get paid is determined by their grade in math and how many days they come to school so its kind of an incentive to get their grades up and to come to school)
Students don’t actually get paid with real money, it’s an exercise in personal finance, part of a year long applied math project.
An A student can make 90 dollars a day; a B student can make 85, and so on.
They can make extra money for good behavior or for performing well.
And they can be fined for breaking classroom rules.
In today’s class, instead of learning algebraic equations out of a textbook,
Bowler hands out apartment rental guides.
(nat sound: once you find the one you want, figure out the monthly fee, you got to pay first and last months rent….)
Students get to work figuring out what kind of apartment they can afford based on their current earnings and what they’ve been able to save.
But like many consumers, students Alan Tonias and Robert Barton go for exactly what they want, never mind how much it costs.
(I found this really great place, it has like video, T1, this place is right in Boston harbor, it’s 24 hundred. How much do you have so far? I know I had like around 450 and just deposited around 630 plus the 1000.)
Alan Tonias doesn’t seem to realize yet an apartment like that would leave him with little or no money left over.
And as part of the project, students have to budget for utilities, and will have to pretend to buy a car later on.
Student Daniel Reinemann says he’s already learned a good reason to stay away from expensive apartments.
(I found that Uncle Sam likes money...For this week I got paid 900 dollars, but then you have to deduct your taxes which this week was about 200 something dollars)
Teacher Pete Bowler says students are learning math without realizing it.
Bowler2 (1046 :05 a lot of times what we teach in math they probably will never use. In real life this is something they’re definitely going to use, they’re all going to get a checkbook, they’re all going to rent apartments, they’re all going to get a car loan, eventually hopefully, so this is kind of real stuff they’re learning in eighth grade)
New Hampshire’s Federal Credit Union gave all the students check books and registers to keep track of their earnings.
Marketing Manager Polly Saltmarsh says the credit union’s loan officers help the students pretend to buy cars; an eye-opening experience for them.
1035 :28 they get to a certain point and they decide that while I rented this great apartment that cost 1200 dollars a month with my buddies, now I can’t afford a car, or they start out wanting to buy a Hummer and realize their income and rent isn’t going to allow them to buy a Hummer now they have to go buy a GEO
Some of the lessons Saltmarsh is teaching these kids, may even surprise some adults.
1038 :56 we showed them last year if they bought a plasma TV for 2500 dollars that monthly rental of ten dollars, what they actually end up paying was more like 18,000 dollars over 15 years for this TV is it really worth it
Some students have already learned that money goes only so far.
Student Cassie Denoncourt teamed up with a classmate to afford an apartment near Boston.
She says she’s surprised by the high cost, and up until recently, never thought she’d have to worry about paying rent.
1068 I always thought my parents would pay for that kind of stuff but I asked them a week ago and they’re like no cassie, you’re going to spend that on your own so I have to make all my own money, and that will be difficult.
And just to make the project a little more like real life, teacher Pete Bowler teases students with an occasional sale.
1052 :19 I’ll do stuff like when I know rent is due on Monday, I’ll bring in items to auction off on Friday in the hopes that, I’m not trying to trick anybody but I want them to learn ‘look I need this money for Monday’ but I’m going to try to get them, entice them to spend their money on items for auction.
If students aren’t careful they can go into debt.
Bowler says the only way out is to take out a loan and make monthly payments, or dip into their savings accounts.
1052 :11 they can put money into savings but they can’t take it out until the end of the year, or if they take it out early, they get penalized for the interest they make.
The goal is to get students thinking about the consequences of their spending, and what impact it may have on their future.
At the end of the year, students participate in an auction where they use their pretend savings to bit on real items ranging from Frisbees and beach towels, to toys and games.
The more they’ve saved, the bigger their reward.
For NHPR news, I’m Amy Quinton.
Delicious
Digg
Reddit
Facebook
Google
Yahoo
I was very interested in this story- I just amazed me that childern of such a young age have such an large amount of buying power yet we are not teaching them to use or control it.
Please be aware of a new program in NH called Exchange City that teaches childern the same lessons as Mr. Bowler. Childern learn how to balance their own personal accounts- run businesses and be productive citizens of their own city.
We need to teach childern about how to live in the modern world and deal with common issues like money, work ethic and job responsibility.