Incorporating Financial Education and Hands-On Money Management into After School Programs Laura Ewing, Texas Council on Economic Education, laura@economicstexas.org Laura Rosen, Center for Public Policy Priorities, rosen@cppp.org Out-of-School-Time Initiatives Conference 2014 Fort Worth, TX July 25, 2014 1 Joint statewide initiative of the Center for Public Policy Priorities and RAISE TEXAS that invests in innovative programs that integrate financial and asset building activities into statewide platforms, including education, social services, and the workplace. Fueling economic mobility for Texas families and children Sign up for our email updates at www.opportunitytexas.org “Like” us on Facebook Initiatives: – Texas Children’s Savings Partnership – Tax-Time Savings Project – Employer-based asset building Basic needs Education Workforce 2 OpportunityTexas Asset building Why Connect Financial Education and Savings Accounts? • Academic achievement – educational savings account ownership is associated with higher scores on math achievement tests • Improved college aspirations – children with < $500 in savings for college are 3X more likely to attend and 4X more likely to graduate from college • Financial health - students with a savings account 7 years later were 2X more likely to have a savings account and 4X more likely to own stocks 3 Existing School-Based Financial Education and Savings Account Programs • Offered in a school setting • Typically involve savings matches and/or other incentives • Restricted accounts, to be used for higher ed -San Francisco’s Kindergarten to College -KIPP College Account Program -Propel Schools’ Fund My Future -Mississippi College Savings Account Program -Cuyahoga County (Cleveland), OH’s College Savings Account Program -Nevada’s College Kick Start Program 4 Assessing Financial Capability Outcomes (AFCO) Youth Pilot Study aims to better understand how to provide children with the financial skills to become economically successful • Focus on elementary-age students • Rigorous examination of financial education combined with student account access 5 Financial Education + In-School Banking Eau Claire, Eau Claire, WI Wisconsin Study Timeline & Sample -Eau Claire, WI 2011-12: 4th & 5th grade 2012-13: 4th grade & follow-up survey for 5th graders Amarillo, TX 6 -Amarillo, TX 2012-13: 4th grade 6 Research Questions What is the impact of financial education and in-school account access, alone and in combination, on students: – Financial Knowledge – Attitudes towards savings and financial institutions – Behavior, e.g. opening and using bank accounts Credit union or bank in school No credit union or bank in school 7 Financial education No financial education Credit union or bank in school + Financial education No credit union or bank in school + Financial education Credit union or bank in school + No financial education No credit union or bank in school + No financial education 7 Financial Education • 5 or 6 lessons from Financial Fitness for Life curriculum (covered nearly all Texas’ new PFL curriculum) • Content focused on Savings Account Use – – – – Defining income, expenses and savings Wants vs. needs, incentives and goals Explain budgets and savings plans Compare savings options and understanding interest • Teachers trained for 3 to 6 hours on curriculum and materials (in TX training by TCEE) 8 In-School Banking, Amarillo • Happy State Bank Kids’ Bank – Account Type: Joint ownership savings account (also opened minor-only account for the pilot) – Frequency: Every 2-3 weeks (once a week during study period) – Bank Transactions: Kids can only make deposits at school branch – Student Staffing: Student tellers work with HSB staff (timing of research didn’t allow for student staffing during the study) – Show Video 9 9 Amarillo In-School Banking Take-Up • 38% overall participation • Same or higher take-up in schools with more economically disadvantaged students 10 Amarillo Teacher Feedback Students’ Level of Understanding: • Items discussed in lessons should take into consideration students’ income levels Kids’ Bank: • Nearly all positive feedback from teachers • Students excited about saving & Kids’ Bank participation brought concepts taught to life 11 Insights and Successful Practices to Operating an In-school Banking Program • Present banking program and financial education curriculum to students and parents as one program • Have school district market in-school banking program to students • Offer accounts that meet the needs of all families 12 Overall Results • Large effects of education on knowledge questions – Financial education appears to produce a large improvement in financial knowledge—an increase in the number of correct questions between 1.8 and 2.0 – No evidence that having a bank branch in the school has an added effect on learning • Moderate effects of in-school banking and education on attitudes about financial institutions and saving 13 13 Overall Results • Behavior - Financial education and bank access boost bank account ownership by kids – Financial education increases the number of banked students by about 3.5% – $25 incentive causes about an 18.1% marginal increase in students opening accounts • Effects persist … at least for a year 14 14 Texas Children’ Savings Partnership 15 Vision • Every student and parent that wants to open a college savings account at school can do so Delivery channel • Public schools through Texas’ new K-8 math personal financial education curriculum TCSP’s Quest for “Off-the Shelf” Product Core Elements • No fees • Restricted for Postsecondary ed. • Incentivized participation • Connected to PFL curriculum and K-12 system • SSN’s not required to open accounts • Offered in partnership with local financial institutions 16 Texas Children’ Savings Partnership Phase 1 Phase 2 17 • Feasibility study and pilot in 1-2 school districts during 2014-2015 & 20152016 school years • Purpose: pilot will help us refine program, identify policy barriers, provide us with evidence of benefits of the program and help us generate support for statewide program • Develop toolkit outlining model account features and program implementation • Advance policies that support statewide program (e.g. define accounts in statute, etc.) • Identify one program administrator and custodian for statewide program Texas Children’s Savings “Ecosystem” 18 Schools/Districts Financial Institutions CommunityBased Orgs Philanthropy Resources Download AFCO Youth pilot report and briefs at: • http://cfed.org/knowledge_center/resource_directory/search/financial_education__account_access_among_ele mentary_students_findings_from_the_assessing_financial_capability_outcomes_youth_pilot_full_report • Implementation brief about the Amarillo field study and materials from the pilot http://opportunitytexas.org/about-us/current-initiatives/smarter-texans-save • Treasury Notes blog http://www.treasury.gov/connect/blog/Pages/Promising-Hands-on-Financial-Education-Strategy.aspx Texas’ New Personal Financial Literacy K-8 math curriculum • Curriculum standards http://smartertexas.org/?page_id=677 • Texas Council on Economic Education’s lessons to teach the standards for most grades http://smartertexas.org/?page_id=1145 19 501(c)3 Texas wide nonprofit 1801 Allen Parkway, Houston, TX 77019 tcee@economicstexas.org www.economicstexas.org * www.smartertexas.org P: 713.655.1650 Presenter: Laura Ewing/President 20 Jean Walker, MBA West TX A&M Steve Cobb, Ph.D. University North TX Cheryl McGaughey, MBA, Angelo State U Susan Doty, MBA UT Tyler Alberto Davila, Ph.D. UT Pan Am Nancy Shepherd, Ph.D. Stephen F. Austin State University Cindy Manzano Valerie Johse TCEE Math Specialists Laura Ewing TCEE President TCEE Center Directors and Staff Provide Training All Over The Great State of Texas In After School Programs, Personal Financial Literacy (PFL), Social Studies Economics Strand, Math PFL, Career/CTE, Entrepreneurship, Economics, Paying For College 21 To Learn More About Personal Financial Literacy Materials and Lessons at the CEE Conference 22 Resources to be Discussed • • • • • 23 Saving for College K to 8 Math PFL Lessons Middle School After School Program Never Too Young After School Program Stock Market Game™ Saving For College The Why, When, and How • Published by RAISE Texas • Parent and Student Guides Written by TCEE • Download Book And Guides at http://economicstexas.org/?page_id=5703 • http://smartertexas.org/?page_id=1231 24 Saving for College Parent/Student Guiding Questions • • Pre-survey Questionnaire Parents: To better understand your child’s interests and base knowledge of the relationship between occupation and education, ask the following questions. • • 1. Do you want an occupation (or job) in which you work outside or inside? 2. Younger elementary aged children: Circle the job description that best describes what you would like to do as an adult. – – – – – – – – – – – – 25 Work with computers Take care of the sick Build and fix things Draw pictures Read and write Do math and science Teach children Play or coach sports Cook food Entertain people Work with animals Help people Resources for College • http://raisetexas.org/resources/collegesavingsresources/ Saving for College • http://library.cppp.org/files/2/2012_05_JO_Cost_Of_College.pdf • http://www.tgslc.org/tfaic/ • http://www.aie.org/ • collegeforalltexans.org • http://library.cppp.org/research.php?aid=1199 The Cost of College: How Texas Students and Families Are Financing College Education 26 SB 290: PFL In K-8 Math • Will take effect 2014-2015 • Testing begins 2015 • Texas Council on Economic Education, Opportunity Texas, Raise Texas, Texas Credit Union Foundation and others played a prominent role in the adoption of the standards 27 How? • TCEE Lessons Are Online and Free to All – – – – – – Woodforest Bank Sponsoring Grades 2-3 TCUF Sponsoring Grades 4-6 PlainsCapital Bank Sponsoring Grades 7-8 PlainsCapital Bank Sponsoring After School Lessons Cornerstone Credit Union Foundation 1 K & 1 First Seeking Sponsors for Grades K to 1 • Never Too Young: Personal Finance for After School Learners from Council for Economic Education 28 How to Find the Lessons? • Smartertexas.org • Economicstexas.org • Click on FREE RESOURCES • Click on Math and PFL Books 29 Kindergarten & First Grade 30 Grades K-1 Incomplete • Kindergarten: The Money Making Farm • First Grade: What Do You Do At The Zoo? Will be completed with additional funding. 31 Grades 2 – 3 Classroom Lessons 32 Grade 2 Lessons Lesson 1: Empty Pockets Math 2.11B Lesson 2: A Time to Deposit, A Time to Withdraw Math 2.11C 33 Lesson 3: Learning to Squirrel It Away Math 2.11A Lesson 4: Whooooo’s the Wise One Math 2.11D Lesson 5: Lending is Risky Business Math 2.11E Lesson 6: A Producer’s Powers Math 2.11F Grade 3 Lessons • Lesson 1: The Ladder to Success Math 3.9A • Lesson 2: Scarcity is Scary Math 3.9B • Lesson 3: Savor the Savings Math 3.9C • Lesson 4: Flat Broke Math 3.9D • Lesson 5: Pooling Our Savings Math 3.9E • Lesson 6: Decisions, Decisions, Decisions Math 3.9F Social Studies 3.6B Free Enterprise System 34 Grades 2 and 3 Vocabulary and Power Points • • • • • • • 35 Wants and Needs Goods and Services Money Scarcity Opportunity Cost Budget Free Enterprise System Grades 4 to 6 Book Classroom Lessons 36 Grade 4 Classroom Lessons • • • • • • 37 Lesson 1: Not Enough Bucks Lesson 2: Ideas for Raising Profit Lesson 3: Saving is Not Just Child’s Play Lesson 3: Savings Options PowerPoint Lesson 4: Divide and Conquer Lesson 5: Smart Cash 4.10E Grade 5 Classroom Lessons • Lesson 1: The Case of the Disappearing Paycheck • Lesson 2: How Will I Pay? • Lesson 3: Where Does All My Money Go? • Lesson 4: Money In, Money Out 38 Grade 6 Classroom Lessons Lesson 1: Best Payment Option: Debit or Credit 6.14B Lesson 2: Checks and Balances 6.14A, 6.14C Lesson 3: Credit Reports 6.14D, 6.14E, 6.14F Lesson 4: Which Job is Best for Me? 6.14H Lesson 5: Paying for College 6.14G 39 Grades 7 and 8 Lessons 40 Grades 7 & 8 Classroom Lessons Middle School After School Lessons 41 Grade 7 Classroom Lessons • • • • • • • • 42 Lesson 1: You Can’t Hide From Taxes 7.13A Lesson 2: Personal Budget 7.13B Lesson 3: Family Budget Estimator 7.13D Lesson 4: Know Your Worth 7.13C Lesson 5: Simple and Compounded Interest 7.13E Lesson 6: Smart Shopping 7.13F Grade 8 Classroom Lessons Grade 8 After School Lessons Grade 8 Classroom Lessons • • • • • 43 Lesson 1: Saving for My Future 8.12C, 8.12D Lesson 2: Borrowing Money 8.12A, 8.12B Lesson 3: Methods of Payment 8.12E Lesson 4: Financially Responsible Decisions 8.12F Lesson 5: Devise a College Savings Plan 8.12G Grade 8 After School Lessons Lesson 6: How Annual Interest Rate Works 8.12D Lesson 7: How Does Your Money Grow? 8.12C, 8.12D Lesson 8: Borrower Beware 8.12A, 8.12B, 8.12 F Lesson 8: Borrower Beware PowerPoint 8.12A, 8.12B, 8.12 F Lesson 9: Your Money or Theirs 8.12E, 8.12F Lesson 10: Savings Plan for College 8.12G 44 Presentations Available Online “Recent Presentations” 45 Personal Financial Literacy After School Program Explore: Concepts • • • • • Interest Rates: – calculate and compare simple and compound interest Saving and Investing: – regular investments grow over time Loans and Repayment – Interest rate and loan length affect cost of credit – Total cost of repaying a loan – Analyze situations to determine responsible decision making Credit and Debit Cards – Advantages and disadvantages of payment methods – Analyze situations to determine responsible and irresponsible borrowing and costs of irresponsible borrowing Saving for College – Estimate the cost of a 2 and 4 year college or post graduate education Explore and Explain: What Are The Five Parts Of Each Lesson? • Engage • Explore • Explain • Elaboration • Evaluate • Brains Settle Elaborate • How do you learn? Visual: • read, watch movies or see things on the computer screen? Auditory: • hear such as through lecture, stories, other Tactile Kinesthetic • experience through simulations, online programs, discussion, building and making Elaborate: English Language Learners (ELL) • Need understanding and acceptance • Use think-pair-share • Ask what the group decided rather than “your” answer • Use and practice “sign language” • Use choral reading/responses so not alone Settlement Into the File System of the Brain • Discussion increases understanding. • As you concentrate on other things, the brain will sort through information and file it away. • Review your notes and the PowerPoint by tomorrow afternoon to help the brain record, remember and retrieve the information. • Revisit the notes and PowerPoint in one week. Lesson 6: How Annual Interest Rate Works • Content: Interest Rates: – Calculate and compare simple and compound interest • Strategies: – Interactive Notebook (History Alive strategy) • Helps students organize lessons and provides a take home reminder at the end of the after school program of the concepts and skills learned – Role play • Will these strategies be auditory, visual and/or tactile kinesthetic? Lesson 6: How Annual Interest Rate Works • PFL Math 8.12D calculate and compare simple interest and compound interest earnings What is the difference? • Interest earned • Interest paid Savings and loan simulation • Saver • Bank • Borrower Lesson 7: How Does Your Money Grow? • Content: – Learn that even small amounts of money saved regularly grow over time – Calculate and compare simple and compound interest • Strategies: – Interactive Notebook – http://www.bankrate.com/ used to calculate interest How can financial institutions help people save? • Keeping your savings in a financial institutions removes the temptation to spend the money. • Your money will be safe because financial institutions are insured. • Money in a savings account earn interest. • Go to http://www.bankrate.com/ Lesson 8: Borrower Beware • Content: – Determine how Interest rate and loan length affect cost of credit – Figure the total cost of repaying a loan – Analyze situations to determine responsible decision making • Strategies: – Calculate different payments and solve real world problems – Analyze different financial situations and explain benefits of financially responsible decisions – Interactive lecture requires students to problem solve Lesson 9: Your $ or Theirs? • Content: – Determine advantages and disadvantages of payment methods for credit and debit cards – Analyze situations to determine responsible and irresponsible borrowing and costs of irresponsible borrowing • Strategies: – Analyze real world situations – Learn to use a bank register – Organize characteristics of payment methods Credit card and Debit Card • What is the same? • What is different? Federal Trade Commission Recommendations: Don’t give your account number to anyone on the phone unless you’ve made the call to a company you know to be reputable. If you’ve never done business with them before, do an online search first for reviews or complaints. Carry your cards separately from your wallet. It can minimize your losses if someone steals your wallet or purse. Carry only the card you need for that outing. During a transaction, keep your eye on your card. Make sure you get your card back before you walk away. Never sign a blank receipt. Draw a line through any blank spaces above the total. Save your receipts to compare with your statement. Open your bills promptly — or check them online often — and reconcile them with the purchases you’ve made. Report any questionable charges to the card issuer. Notify your card issuer if your address changes or if you will be traveling. Don’t write your account number on the outside of an envelope. Activity 8.9-3 • Emily is a freshman in college and lives in the dormitory. Her room and board have been paid with her college savings and a grant. She will be working 10-15 hours a week through the college work study program. Lesson 10: Savings Plan for College • Content: – Estimate the cost of a 2 and 4 year college or post graduate education • Strategies: – Use a questionnaire to determine vocational interests – Use technology to analyze scorecards and determine cost of college Visual 8.10-1 & Activity 8.10-1 • Occupational Information for Texas • Connect to occupational goals. • On-line tools – http://www.texasrealitycheck.com/ – http://collegecost.ed.gov/scorecard/index.aspx – http://www.fafsa.ed.gov/ Never Too Young: Personal Finance for Young Learners After School Program for Elementary School Students in Personal Finance and Economics Laura Ewing, President Texas Council on Economic Education Houston, Texas Jean Walker, Director West Texas Center for Economic Education College of Business, WTAMU 66 66 Overview of the Lessons 67 • • • • • • • • • • • • Lesson 1 We Have Wants ................................................................... 9 Lesson 2 Scarcity .............................................................................. 23 Lesson 3 Choices, Costs and Benefits ................................................ 30 Lesson 4 Consumers, Producers and Resources ................................ 36 Lesson 5 Entrepreneurs in the Community and Advertising .............. 47 Lesson 6 Entrepreneurship and Problem‐Solving .............................. 63 Lesson 7 Entrepreneurship and Market Day ...................................... 77 Lesson 8 Budgeting ........................................................................... 87 Lesson 9 Saving Your Money ............................................................. 97 Lesson 10 Government‐Provided Goods and Services ...................... 105 Lesson 11 Market Day—Implementation ......................................... 113 Lesson 12 Market Day—Wrap‐up ..................................................... 118 • • First Training Second Training 67 I’ve Got Money Lyrics Tune: Are you Sleeping, Brother John • • • • • • • • 68 I’ve got Money, I’ve got Money, What should I do? What should I do? I must make a choice, I must make a choice, Spend or save, Spend or save. 68 Why Do We Have to Make Choices? 69Lesson 1 – We Have Wants 69 What Are Goods and Services? • Good • Service 70 70 ECONObucks • Use as INCENTIVES: – – – – to increase motivation for participation to reward good citizenship for completing work • Use for BUYING and SELLING in multiple lessons. • Use for DEPOSITS and WITHDRAWALS in lessons that teach banking skills. 71 ECONObuck Register • Name________ Grade_____ School _______ Check # Date Transaction/Description Subtractions Amount of Payment $$$ 72 Additions Amount of Deposit $$$ Balance $$$$ 72 This is the logo for . . . 73 73 Match the logos to the product: 74 Aflac American Greetings AT&T Ben & Jerry’s BIC Froot Loops Hallmark HSBC Kraft Foods Liberty Mutual Macy’s Microsoft Pillsbury Purina Walgreens 74 slogans • What business is identified? – – – – – – It’s the cheesiest! (Kraft Macaroni and Cheese) Just do it! (Nike) Good mood food (Arby’s) It’s the real thing (Coca-Cola) The quicker-picker-upper (Bounty paper towels) Finger-lickin’ good (KFC – Kentucky Fried Chicken) – Melts in your mouth, not in your hand (M&Ms) 75Lesson 5 – Entrepreneurs in the Community and Advertising 75 Who is the target market of the ad? 76 76 Closure and Assessment • Closure: – What is an entrepreneur? – How are businesses interdependent? – How do businesses affect one another and the community? – Why is advertising important for businesses? • Assessment: – Older students: have students write an answer to the question of the day. – Younger students: On Handout 5.4, ask students to circle the picture of an entrepreneur. 77 Lesson 5– Entrepreneurs in the Community and Advertising 77 Story: – Penny’s New Business 78 78 Market Day Planning 79 Lesson 7 – Entrepreneurship and Market Day 79 Three Student Programs Directly Reach 27,000 students annually Stock Market Game™ Economics Challenge Personal Financial Literacy (PFL) Challenge 80 Texas Regional Competitions • • • • • 10 week simulation Grades 4 through 12 Teams of 2-5: $10/team Virtual $100,000 to invest 20,000 Texas students participate annually • Legislative Challenge • Research indicates improved math scores on standardized tests 81 • $10 per team El Paso Awards Dinner InvestWrite Open to students participating in the Stock Market Game™ Elementary, Middle and High School Competition Cash prizes from Texas High School National Winner visits Wall Street First and 9th Place National Winners From Texas in 2014 82 Personal Financial Literacy Challenge 83 • Teams of 4 compete in online test for state finals • Winning state team and teacher win cash • First place state team attends regional and national finals at St. Louis Federal Reserve Bank • Funded by State Farm • Bellaire HS Placed 5th in Nation in 2014 The TCEE programs are made possible by the following TCEE partners. EnviroChem Services, Inc. John Anderson Trout Foundation copyDR. 84 Less B. Fox RBC Wealth Management Board of Directors James Cooper - Chairperson James C. Cooper, Inc. Marcus McCue Guardian Mortgage Co., Inc. Joe Adams - Treasurer Texas - Omaha Group LLC Dawn Moeder Lane Gorman Trubitt, L.L.P. Anthony Daddino Meadows, Collier, Reed, Cousins, Crouch & Ungerman, L.L.P. Andrew DeLauro Citibank Thomas Fleissner Houston Information Team, L.LC. Ed Segner Retired Wayne Goettsche WKG Consulting Robert Smith Texas A&M University at Galveston John Ivie Basdin & Ivie P.C. Pete Villarreal PlainsCapital Bank Laura Jaramillo Wells Fargo Director Emeritus: John Anderson Anderson Investments Sherry Kiser Federal Reserve Bank of Dallas 85 Donna Normandin Frost Bank Director Emeritus: Carol Trout Trout Foundation A FINANCIAL LITERACY PROGRAM SPONSORED BY Helping young people learn to think, choose, and make better economic and financial choices in a global economy www.economicstexas.org www.smartertexas.org 86 1801 Allen Parkway, Houston, TX 77019 P: 713.655.1650 F: 713.655.1655 Laura@economicstexas.org Catherine@economicstexas.org Cindy@economicstexas.org Valerie@economicstexas.org smg@economicstexas.org Cherry@economicstexas.org allen@economicstexas.org www.economicstexas.org****WWW.smartertexas.org Helping young people learn to think, choose and make better economic decisions. 87