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LESSON PLANS
Personal Finance

CONTENTS

Total Instructional Time
Lesson: Time Management and Health
Lesson: Finding a Job
Lesson: Budgeting and Saving
Lesson: Finding an Apartment
Lesson: Buying a Car
Lesson: Shopping
Lesson: Choosing and Balancing a Checking Account
Lesson: Getting a Credit Card
Lesson: Fixing Your Credit
Lesson: Education and Advancement
Lesson: Using Online Banking
Lesson: Paying Your Taxes
Lesson: Intro to Investing
Lesson: Risk vs. Return
Lesson: Diversification
Lesson: Investing for Retirement
Lesson: Buying a Home
Lesson: Insurance
Lesson: New Career Project

Total Instructional Time

The instructional time for Personal Finance ranges from 13 hours (simulation exercises only) to 31 hours (simulation exercises, readings assignments, reading quizzes, and math quizzes). You can configure your course to include or exclude reading assignments (6 hours), reading quizzes (3 hours) and math quizzes (9 hours). For detailed instructions on how to configure your course, see Getting Started under Instructor Documentation on your instructor page.

Prior to beginning work with Personal Finance, students should sign in to their account at vb.KnowledgeMatters.com and watch the Tutorial video.

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Lesson: Time Management and Health

timemanagement

DESCRIPTION

Students develop a schedule that lets them get to work on time, stay healthy, and eventually further their education. Students monitor their health and discover a problem with nutrition. They remedy this problem by purchasing food and scheduling time to eat. They next improve their relaxation and exercise levels by devoting more time to these and making purchases that improve their time efficiency. Finally, students learn the importance of reliable transportation when they are late for work due to a lack of bus tokens and were forced to walk to work.

LEARNING OBJECTIVES

  • Students will be able to monitor key health factors.
  • Students will be able to allocate time and make smart purchases to improve their health.
  • Students will be able to plan and alter schedules to allow them to balance health, work and educational goals.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 25 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Finding a Job

findingajob

DESCRIPTION

Students will locate available jobs within a simulated city. They will then review their resume to determine their qualifications. They will then find the jobs for which they qualify based on their experience, education, and available transportation. They will apply for and take the highest paying job for which they qualify. Students view their pay stub and compare their gross pay to their net pay. Since their job does not offer health insurance, students look at the cost of purchasing this on their own. Students then look for a better job with health insurance. By working at their current job, they gain the experience necessary to get the better job.

LEARNING OBJECTIVES

  • Students will be able to research and compare potential job openings.
  • Students will see how experience and education qualify them for different levels of jobs.
  • Students will see how payroll taxes and income tax deductions cause their net pay to be less than their gross pay.
  • Students will learn that some jobs provide health insurance and some don’t.
  • Students will experience how working at one job can give them the experience necessary to get a better paying job with more benefits.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 25 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Budgeting and Saving

budgetingandsaving

DESCRIPTION

Students begin by reading a record of their weekly gross and take-home pay. They use this to estimate their monthly income. Students then review their outstanding bills for the month and add them up to determine their monthly fixed expenses. They also calculate expected food and transportation costs for a month. From this, they determine if they have a monthly surplus or deficit. Students then experience an injury that results in a large medical bill. Finally, students open a savings account and save to build up an emergency fund.

LEARNING OBJECTIVES

  • Students will be able to read a pay stub and understand gross pay, payroll deductions
  • and net pay.
  • Students will be able to estimate monthly income and expenses based on their pay stubs and their bills.
  • Students will be able to determine whether they expect a surplus or deficit in their budget.
  • Students will be able to read a bank statement to determine their actual income and spending and to compare that to their budget.
  • Students will understand how to open a savings account.
  • Students recognize the importance of saving money for an emergency fund.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Finding an Apartment

findinganapartment

DESCRIPTION

Students find themselves trying to take classes during the day and work at night. However, they cannot make it on time to class given their current location. They switch apartments and change their mode of transportation. They continue apartment hunting until they find the best apartment in terms of total cost. Finally, they explore more apartments until they find one that lets them make it to class and to work on time.

LEARNING OBJECTIVES

  • Students will understand how apartment location, transportation, and their schedule must work together.
  • Students will be able to compare costs of different apartments, including related costs such as transportation.
  • Students will be able to explore different apartments in order to facilitate a schedule that accomplishes their goals.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Buying a Car

buyingacar

DESCRIPTION

Students will explore buying a car as an alternative to taking the bus. Students will determine how much they can afford to pay based on their income and expenses. They will then comparison shop for cars and determine which they can afford. Students will next compare the cost of leasing vs. buying over time. Students will then purchase a car with an auto loan, get auto insurance, buy gas, and use the car to get to work. They will make payments on time on their car loan for three months.

LEARNING OBJECTIVES

  • Students will be able to assess the type of car they can afford based on income and expenses.
  • Students will be able to compare the cost of buying vs. leasing a car.
  • Students will understand key elements of a car loan, including down payment, monthly payment, and term.
  • Students will understand auto insurance, including mandatory coverages, optional coverages, and deductibles.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Shopping

shopping

DESCRIPTION

Students learn to shop effectively, so they can obtain goods that improve their lives at the lowest possible cost. Students comparison shop for goods that help them exercise, sleep, and relax more efficiently. They also learn to watch for sales that allow them to purchase goods for less. Finally, while staying within a limited budget, students purchase a series of items that improve their health.

LEARNING OBJECTIVES

  • Students will learn how to identify and purchase goods that help their productivity, and therefore, improve their financial security.
  • Students will understand how to comparison shop to get the most for their money.
  • Students will understand how to utilize periodic sales to expand their purchasing power.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 45 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Choosing and Balancing a Checking Account

checkingaccount

DESCRIPTION

Students begin by learning that cashing checks without a checking account can involve high fees. They then compare features of several checking accounts and pick the best one. Students arrange for direct deposit of their work checks into the account. Students record a series of credits and debits in their check register. Students balance their checkbook against a bank statement and correctly account for outstanding checks that have not yet hit the bank statement.

LEARNING OBJECTIVES

  • Students will understand that cashing checks without a checking account can be costly.
  • Students will be able to correctly enter deposits (credits) in a check register.
  • Students will be able to correctly enter expenditures (debits) in a check register.
  • Students will be able to balance their checkbook against a recent bank statement.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 45 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Getting a Credit Card

gettingacreditcard

DESCRIPTION

Students begin by reviewing credit card offers from several banks in their city. They compare APRs, credit limits and fees. After selecting the best offer, they use their credit card to make a purchase at the department store. They then pay off the entire credit card bill and note the absence of any finance charges or late fees. Students next make more purchases. This time, however, they only make the minimum payment and experience significant finance charges. Next, they miss a payment entirely and learn how finance charges and late fees can cause their balance to balloon. Finally, students work for a few months and pay off their credit card debt entirely.

LEARNING OBJECTIVES

  • Students will understand APR, credit limits, and credit card fees.
  • Students will be able to compare credit card offers.
  • Students will understand the benefits of paying off a credit card bill fully.
  • Students will understand how quickly finance charges and late fees can raise the amount owed on a credit card.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 45 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Fixing Your Credit

fixingyourcredit

DESCRIPTION

Students learn how to improve their credit score. They begin by reviewing their credit report and identifying problems. They then try to buy a car and experience the difficulties created by poor credit. Students then begin to improve their credit score by paying off several overdue bills. Next they get a credit card, make some purchases, and pay off their credit card bill fully. Students continue this pattern to build a better credit score. Along the way, they try again to purchase a car and they experience the benefits of better credit.

LEARNING OBJECTIVES

  • Students will be able to read a credit report and identify problem areas.
  • Students will understand the impact of poor credit on major purchases such as an automobile.
  • Students will understand how paying off overdue bills will improve their credit score.
  • Students will learn to build a good credit history by using credit responsibly.
  • Students will understand the concepts of a credit score, including what constitutes a good and a bad score.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Education and Advancement

educationandadvancement

DESCRIPTION

Students work to advance their career by getting a better education. They research what classes are needed to get a job as a Data Entry Specialist. While working as a cashier, they take out a student loan and enroll in the Intro to Data Entry class. After completing the class, they quit their job as a cashier and take the new, higher-paying job. They then compare their new take-home pay to their old take-home pay and compute how long it will take for their investment in education to “pay back.”

LEARNING OBJECTIVES

  • Students will be able to research job opportunities and determine what education is needed to obtain specific jobs.
  • Students will understand the importance of education in furthering their careers.
  • Students will understand how student loans work.
  • Students will be able to analyze the cost of particular courses and determine how quickly an investment in education is likely to pay back.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Using Online Banking

onlinebanking

DESCRIPTION

Students learn how to use online banking effectively to improve their financial lives. They begin by purchasing a computer and getting Internet access. They access their (simulated) online banking account and check balances. Next, they set up recurring monthly payments for regular bills to reduce their workload. They check their bank statement to confirm that their payments are working correctly. Finally, they use online banking to transfer money from their checking account to their savings account to reach a savings goal.

LEARNING OBJECTIVES

  • Students will understand how online banking can help them manage their finances more effectively and efficiently.
  • Students will understand how to check account balances.
  • Students will understand how to set up and monitor recurring bill payments.
  • Students will understand how to transfer money between accounts.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Paying Your Taxes

payingyourtaxes

DESCRIPTION

Students gather information for their tax return and fill out a 1040EZ form. First, students read W2 statements from two jobs and total up their wages and federal income tax withheld. Next, they read a 1099-INT and record interest earned from a bank account.  They also review statements documenting their health insurance coverage for the year and determine if they owe a tax penalty for having gaps in insurance coverage.  Students then enter information on the correct lines of the 1040EZ tax return form. They use a tax table to find their tax owed and compute their refund. After running time forward, they receive their refund and deposit it into their bank account.

LEARNING OBJECTIVES

  • Students will be able to read and identify key information on a W2 wage and tax statement.
  • Students will be able to read and identify key information on a 1099-Int interest statement.
  • Students will be able to fill out a 1040EZ form.
  • Students will be able to use a tax table to compute tax owed.
  • Students will be able to compute whether they owe tax or should receive a refund.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 45 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Intro to Investing

introtoinvesting

DESCRIPTION

Students begin their journey into investing by trying out two safe investment alternatives: savings accounts and money market funds. Students find the bank with the best interest rate on FDIC-insured savings deposits. They invest $1,000 for a year and find their return. Next, students find a money market mutual fund with a higher yield but a front-end load.  They invest and find their total return for the year. Students try a money market fund with a higher yield and no load. Finally, students search for another money market fund with an even higher yield, no loads, and a lower expense ratio.

LEARNING OBJECTIVES

  • Students will understand how to invest in FDIC-insured savings accounts.
  • Students will understand how to compare money market funds.
  • Students will understand yield, loads, and expense ratios.
  • Students will understand that returns on mutual funds vary over time.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 45 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Risk vs. Return

riskvsreturn

DESCRIPTION

Students investigate the relationship between risk and return in investing. They begin by investing $1,000 in a low risk money market fund. They also purchase $1,000 worth of a stock mutual fund. Students then run simulated time forward and compare the returns from the two funds. The students then examine the month-to-month volatility of their two investments over time. Students discover that the fund with the higher return over time also had the higher volatility. Finally, students invest in the stock fund to reach an investment goal over time.

LEARNING OBJECTIVES

  • Students will understand the difference between a money market mutual fund and a stock fund.
  • Students will be able to compute percentage return based on the beginning and ending value of an investment.
  • Students will understand the concept of volatility (risk) in an investment.
  • Students will grasp the relationship between risk and return in investing.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Diversification

diversification

DESCRIPTION

Students learn how diversification can help them achieve higher returns without adding a lot more risk. Students purchase shares of two different international stock funds. They then calculate their largest percentage monthly loss on each fund and compare it to the largest monthly loss of their total portfolio. They discover that by combining funds that change independently in value, they can reduce the risk of their overall portfolio. Finally, students use this principle to make further investments to reach a target value for their portfolio.

LEARNING OBJECTIVES

  • Students will understand the concept of diversification in investing.
  • Students will understand that diversification can reduce risk while maintaining return levels.
  • Students will be able to compute risk (volatility) of individual investments vs. their entire portfolio.
  • Students will be able to use diversification to reach an investment goal.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Investing for Retirement

investingforretirement

DESCRIPTION

Students compare the after-tax returns of normal investing against the returns from tax-advantaged retirement investing. They begin by investing in a U.S. stock fund and seeing its return. They also look at their tax return and find their refund after dividend income. Next, students invest the same amount via payroll deductions to their company’s 401K plan with a company match. They then observe that the value of their investment is higher (due to employer matching) and that their refund is higher due to their reduction in wage income and lack of tax on dividends. Finally, students increase their contributions to the 401K plan to achieve a savings goal.

LEARNING OBJECTIVES

  • Students will understand that the tax code offers incentives to save for retirement.
  • Students will understand the concept of a 401K plan.
  • Students will understand company matching in a retirement plan.
  • Students will understand how tax-advantaged retirement plans can help them reduce current taxes and make their investments grow over time.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Buying a Home

buyingahome

DESCRIPTION

Students explore home ownership by purchasing a condo. They begin by looking at their gross weekly income and converting it to monthly income. Students estimate their maximum housing expenses based on 28% of their monthly income. They also look at their car loan payment and compute their maximum housing expense that will keep total debt payments below 36% of their gross monthly income. They then find a condo they can afford. As students apply for a mortgage, they explore how down payments affect private mortgage insurance (PMI) and how points affect the interest rate paid. They also look at how a 15-year vs. a 30-year term affects monthly payments and total interest paid over the life of the mortgage. Finally, students purchase the condo, move in, and make mortgage payments over a year.

LEARNING OBJECTIVES

  • Students will understand how key percentages are used to determine how much housing expense a person can afford based on their gross income.
  • Students will understand how other loan payments affect how large a mortgage they can get.
  • Students will understand PMI and how it relates to down payments.
  • Students will understand points and how they relate to interest rates and monthly payments.
  • Students will understand how the term of a mortgage affects monthly payments and total interest paid.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: Insurance

insurance

DESCRIPTION

Students learn how insurance can help them avoid serious financial losses. First, they experience a robbery (without being insured) and calculate their loss. Next, they shop for insurance and explore the relationship between the deductible and the premium. They also look at the relationship between the amount of coverage and the premium. Students then purchase insurance and experience another robbery. They collect on their loss minus the deductible. Students then look at medical insurance with co-pays and deductibles. They experience a large medical bill, but see that most of the expense is covered by the insurance.

LEARNING OBJECTIVES

  • Students will understand the importance of insurance in protecting themselves financially.
  • Students will understand what a deductible is and how it relates to premiums.
  • Students will understand how premiums vary with coverage sought.
  • Students will understand how medical insurance works and the relationship between co-pays, deductibles and premiums.

TIME

Reading: 20 minutes (optional)
Reading Quiz: 10 minutes (optional)
Math Quiz: 30 minutes (optional)
Simulation Exercise: 30 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students complete the reading assignment (optional).
Students take the reading quiz (optional).
Students take the math quiz (optional).
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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Lesson: New Career Project

project

DESCRIPTION

In this project, students pull it all together to set out on their financial life. They manage their time in a healthy manner, find employment, further their education, and advance through to higher paying jobs. As they reach a target net worth, they advance to a next level where they can explore investing in money markets funds, bond funds, and stock funds. After they reach another target net worth, they can purchase a condo and explore real estate as an investment.

LEARNING OBJECTIVES

  • Students will be able to manage their time to achieve a healthy prosperous balance.
  • Students will be able to find employment and pay bills effectively.
  • Students will know how to use banking, debit cards, and credit cards wisely.
  • Students will be able to use higher education to advance their careers.
  • Students will be able to use insurance to reduce financial risk.
  • Students will be able to invest wisely to build wealth without taking on undue risk.
  • Students will understand home ownership and opportunities in real estate investment.

TIME

Simulation Exercise: 180 minutes

PROCEDURE

Students sign in to Personal Finance at vb.KnowledgeMatters.com.
Students click Run SIM and follow the lesson instructions.
Student progress and grades may be tracked from the Instructor page.
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