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Welcome to the first issue of Making Cents - a financial literacy and economics education resource for teachers from kindergarten through 12th grade! In this publication you'll find information that will expand your content knowledge, resources you can put to use in your classroom, and links to other useful tools.
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 Philadelphia Fed Resources The Federal Reserve Bank of Philadelphia provides resources for teachers from kindergarten to 12th grade on both personal finance and economics topics. You'll find free, downloadable lesson plans ranging from ones based on children's literature for elementary grades to more sophisticated lessons on monetary policy for the upper grades. In addition, you can access information on the Keys to Financial Success - a complete course plan for teaching personal finance to high school students. The program is offered free of charge to schools and teachers. There is also a week-long training program available to schools committed to offering the program. The Philadelphia Federal Reserve Bank offers teacher training on other curriculum and topics as well. Check out the website for additional details. |
 What's Your Financial Reputation? by Cathy Faulcon Bowen, Ph.D.
What is your financial reputation? Just as you have a reputation in your home, community and workplace that was created by your habits and interactions with people, you also have a financial reputation created by your money handling habits. Your credit history and your credit score make up your financial reputation. Whether you are an older adult with several decades of work experience or a young adult just starting to live on your own, your financial reputation affects many aspects of your life. Employers may use a credit report in making hiring decisions. Insurers consider credit worthiness in setting auto insurance rates. Landlords may review credit histories to decide on renters. Finally, those with poor credit histories pay higher interest rates to borrow money for a home, car or other large ticket items. Your personal reputation may vary slightly among the various groups of people (home, community and work) that you interact with daily. However, your financial reputation is concrete and based on a formula that you can control. Let's examine each component of your financial reputation - the credit report and the credit score. The credit report is a written document containing: - personal data about you (name, address, employer, etc.)
- credit accounts and account history (e.g. credit limit, date opened, payments made on time and late)
- public records involving money (court judgments in civil actions, tax liens and bankruptcies)
- inquiries from potential lenders
Inquiries you make to see your credit history do not appear on credit reports produced for potential lenders. Negative accurate information stays on your credit report for seven years with one exception; bankruptcies stay on credit reports for 10 years. Click here to see a sample credit report. If you wish to share your side of the story for negative accurate information, you can add up to a 100-word statement that will be included with any reports sent to potential lenders. The credit score is a number created using a formula by the generating company. Companies use different formulas to calculate scores so Company A's credit score may differ slightly from Company B's credit score. Credit scores can range from 300 to 800. The score is determined by: 35% bill repayment habits 30% outstanding debt 15% length of credit history 10% new credit 10% mix of types of credit (credit cards, mortgages, car loans) The credit score is based on information in the credit report and is used by lenders to quickly assess credit worthiness. In other words, how risky of a client are you? The lower the credit score, the riskier you are and the more you will pay (i.e. higher interest rates) to borrow money. So what is the bottom line for time strapped consumers? Pay your bills on time and in full when possible, borrow only what you need, check your credit report annually and, in general, handle credit responsibly. To get a free copy of your credit report annually from each of the three credit reporting bureaus (Equifax, Experian, TransUnion) visit www.annualcreditreport.com or call (877) 322-8228. Federal law provides for this free report but it is up to you to request the report and review it for accuracy each year. Checking your credit history annually is a low cost, proactive step you can take to keep your financial life in order. |
| 3-2-1 Action: Videos in the Classroom |
 Videos can appeal to students and be great tools to enhance classroom instruction. Check out clips from the PBS show BIZKids. Use the drop down box to search for clips on topics such as budgeting, financial markets, or saving and investing. The clips can be used with an existing lesson or you can download the free lesson plans that accompany each clip. |
| Interview with an Educator |
Tips from the Classroom
In this issue, Stacy Burkey, a Family and Consumer Science educator of 11 years, shares thoughts on teaching personal finance in her classes. Ms. Burkey holds a bachelors degree in home economics from Penn State University and a master's degree in education from Gratz College. She's currently completing a principalship program with Cabrini College. Ms. Burkey teaches high school family and consumer science courses in the Ephrata Area School District. Burkey, a past participant and teacher mentor of the Governor's Institute on Financial Education, has received additional professional development in personal finance and economic education from the Federal Reserve Bank of Philadelphia, including two weeklong summer programs. She is currently serving on the Pennsylvania Department of Education's Task Force on Economic Education and Personal Financial Literacy.
Q: What do you think is the most important personal finance topic to cover with students?
A: The most important topic to cover is being an informed consumer, which is really another way of saying all topics of personal finance are important. I can make a case for the importance of any and all of the following topics; decision-making, budgeting, banking, credit, identity theft, risk management, saving and investing, taxes, and basic economic principals.
Q: In the time you have taught this course, what changes have you noticed? A: The financial landscape is in constant flux, new financial products and services are being offered every day, changes in laws and tax codes happen yearly and the paper check will soon be a distant memory. Our economy has certainly changed since the late 1990s. The impact of a slow economy has been devastating to uninformed consumers: those with no safety net of savings during layoffs, those facing foreclosure on mortgages they could not afford, and people strangled by unmanageable credit card debt. The need for financial education is more obvious than ever before. The strength of our economy hinges on the ability of consumers to manage their finances.
Q: Do you use a textbook? If so, which one? If not, why? A: We do not use a textbook. The variety of free resources is amazing and we use many of those including the Federal Reserve Bank of Philadelphia's Keys to Financial Success, the National Endowment for Financial Education's High School Financial Planning Program, and Family Economics and Financial Education. Also changes happen quickly in the financial world and a written text is quickly outdated. That said, we do have the Business and Personal Finance textbook (Kapoor, Dlabay, Hughes, Hoyt; Glencoe McGraw-Hill, 2002) available for our use. It is used by our school's business department for another course offered in the school. Q: What topic do you find most challenging for students to master?
A: I haven't found one topic to be more challenging than another, my issue has always been student buy-in. They tend to think that managing their finances will just magically come to them when they need it, and that time certainly is not now. It's important to work in the present then make a connection to the future. For example, when you are a teen, investing for retirement is not nearly as important as saving money for a car.
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Webinar for PA Teachers on Financial Literacy and Economic Education
Sign up today for the May 3rd webinar offered by the Pennsylvania Department of Education and Penn State University. Offered from 6:30pm - 8:00pm the program will feature information on the Family Economics and Financial Education (FEFE program), Taxes for Teachers, and an update on PDE's Task Force for Economic Education and Financial Literacy. Register today here: http://www.instantpresenter.com/PIID=EA56D883894B
Grants for Schools
Apply today for a Pathway to Financial Success Grant from Discover. All public high schools are invited to apply for a grant to bring financial education into the classroom or to expand an existing curriculum. The sooner you apply, the sooner you can get started. Visit their website for additional details: http://www.pathwaytofinancialsuccess.org/get-a-grant
Family Economics and Financial Education Summer Programs
The FEFE program is offering several training programs this summer for teachers. Their national training will take place in Tucson, AZ June 25-28. There is also an August 6-8 program in Towson, MD. A limited number of spots are available for teachers from outside of Maryland. Find out more here: http://fefe.arizona.edu/pro-dev/training
Making Sense of Money and Banking
From July 16-20 teachers will learn about money, banking, and the Federal Reserve System at the Federal Reserve Bank of Philadelphia. Registration is due by July 2nd. Find more information here: http://www.philadelphiafed.org/education/teachers/training-programs/index.cfm.
Know of other events? Let us know so we can share them in the next issue. |
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 | | SAS Resources | |
Did you know you can find resources for teaching, and assessing personal finance and economics on the PDE Standards Aligned System?
You can join a professional learning community, search for assessment tools, view various content standards and more.
There are also great examples of integrating topics. Check out the Literacy Design Collaborative informational and explanatory writing task entitled "Credit: What Every Consumer Should Know."
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Teens and Money
In a recent survey, teens were asked what lessons they have learned from the recession. These were the top three responses:
1 - It is important to have enough emergency savings in case times get tough (73%)
2 - It is easy to get carried away and spend too much when times are good (59%)
3 - It is important to understand the consequences of borrowing money
(51%)
The survey also showed that an overwhelming percentage of teens (86%) would rather learn about money management in a class before making mistakes in the real world.
More findings from the Charles Schwab 2011 Teens and Money Survey can be found here. The graphs are reader friendly and would be appropriate to discuss with students in grades 7 and higher. Consider asking your students the same questions and comparing their responses to that of the survey.
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Making Cents is published jointly by the Pennsylvania Department of Education and the Pennsylvania State University. If you find the content useful, please consider forwarding it to your colleagues. Through this publication and other avenues, the Pennsylvania Department of Education seeks to continue efforts made previously by the Pennsylvania Office of Financial Education and the Governor's Institutes on Financial Education.
Newsletter Team:
Sally Flaherty, PDE
Cathy F. Bowen, PSU
Hilary Hunt, Consultant
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