Competition, Collaboration, and Commerce: Financial Literacy 101

Patricia O’Connell
Contributor

A survey by The National Financial Educators Council asked 1,101 young adults aged 18-24 “What high school-level course would benefit your life the most?” A majority—51.4%—responded “money management.” Yet improving financial literacy through formal education still remains an elusive goal. Only 25 states and the District of Columbia require that a high school course in economic education be offered; just 17 states mandate a high school level course in personal finance.Three teachers in Arkansas talk about their innovative approaches to teaching financial literacy and economics, including The Stock Market Game,™ a national competition run by the Securities Industry and Financial Markets Association (SIFMA). The Game allows students and teachers to invest a virtual $100,000 in stocks, bonds, and mutual funds.

(Left to right: Tim Smithey, Director of Gifted and Talented of Springdale Schools, Soe Tin, Dr. Jim Rollins, Superintendent of Springdale Schools, Jose Araujo, Doug McMillon, CEO of Walmart, Carlos Galdamez, Justin Brantley, Teacher at Lakeside Junior High, Joel Melendez, Dominic Narron)

LISA BYRUM, INSTRUCTIONAL COACH, BAKER ELEMENTARY SCHOOL, LITTLE ROCK

Lisa Byrum, a former teacher who is now an instructional coach, has been at Baker Elementary School for 23 years. In her current role, she supports classroom teachers with instructional practices, strategies for reaching kids, and the best curriculum for math and literacy. One innovative approach Baker employs it to use economics as part of “discipline management.”

Students at Baker earn “Baker Money” for good behavior and attendance every day, appropriate to their grade level. “Kindergarten students know about and earn pennies; with fifth graders it’s dollars,” notes Byrum. A pay sheet goes home at the end of every week for parents to sign, and the next week the children have the option of saving or spending the money at the Baker Market. “In 4th and 5th grade we give them the responsibility of paying bills, rent, and utilities, so they learn to budget so they can pay their bills as well as shop at the store.” In fifth grade, the concept of investing money is introduced, with participating in The Stock Market Game as an option.

All students K-5 learn about entrepreneurship through the Baker Bazaar, an annual school-wide event held in December. Every class in each grade starts a business and sells the goods they’ve produced to parents and community members for real money—not Baker Money.  “The businesses are funded by loans—that must be paid back—from the PTA,” says Byrum. “Whatever the class makes in profit they get to decide how to spend.”

Byrum says the economics program has evolved, but the fundamentals have remained the same. “By the end of the year you see a difference in their attitudes and understanding,” she notes. “It’s always so exciting to me when I run into an older kid, maybe someone in high school, who tells me that they have started their own business. Last year I ran into a former student who had started a clothing business of some kind. We’re sending them off to middle school with a strong start, and then by the time they reach high school, they’ve learned a lot. “

JUSTIN BRANTLEY, ADVISOR, LAKESIDE JUNIOR HIGH SCHOOL, SPRINGDALE SCHOOL DISTRICT

Justin Brantley has been teaching the 10-week version of The Stock Market Game for some five years, and with great success: One of his teams usually finishes as No. 1 or No. 2 in the region, and this year, his teams snared both the No. 1 and No. 2 spots in the state, out of 2,200 teams. He notes that he is getting students at an interesting time in their financial education: They’ve had exposure to economics since kindergarten, but with little opportunity for real-world application. Still, they are at an age where they are starting to understand the difference among needs and wants, and the idea that they will want to have money “some day.”

Says Brantley, “They understand that education and having a good job and making money is a start, but we also need to let them know that investing can help with economic inequality. Kids who have that capitalistic spirit and want to attain more and have a higher degree of financial success—this game gets their attention.”

The lessons gleaned from The Stock Market Game are numerous, starting with the nuts and bolts of the vocabulary, helping students understand the relationship between the products they consume and the companies that make them, the role of the government in a free-market system, and finally, what career opportunities may be available to them. “They see how the whole system works and how they could be more involved with it,” says Brantley. He teaches The Game as part of his 9th grade curriculum.

Over the course of the 10 weeks, students are divided into groups of 3 or 4. Another big benefit to the game is it teaches students both collaboration and competition outside of extracurricular activities. “The things that have the most success with kids are competition-based,” says Brantley. “It’s also a big deal to get them to work collaboratively. They’re forced to work together and talk to each other.”

He recognizes that while most of his students won’t be day traders, this exercise that gives them an understanding of the concept of having a long-term financial horizon. “Many of them have never been exposed to that idea,” he says. “We’re letting them know there are a lot of ways to be financially successful and they can possibly change the trajectory of their lives.”

Brantley says that like his students, he has learned over the years. “Through Economics Arkansas there are top-quality resources out there that have helped me not just become a better teacher but be better informed myself. I’m motivated to get my own children started. They more time I give it, the more time there is for the money to grow.”

JON NEWMAN, LEAD TEACHER, BUSINESS, COMMUNICATION ARTS, AND LAW ACADEMY, JONESBORO, ARKANSAS

Jon Newman, lead teacher of the Business, Communication Arts, and Law Academy in Jonesboro, Arkansas, has been using SIFMA’s stock market simulation for “six or seven years”—first when he taught economics, and now as part of his AP Government class. By the time the students reach his AP class in 11th or 12 grade, they’ve already had both an economics and a personal finance class, so his approach is a little more nuanced.

“We try to watch how government interactions impact the market, and how even something as simple as a tweet from the President might cause a reaction in the market,” says Newman. His students, who participate in the two-semester stock simulation, adjust their portfolios based on the lessons derived from the week’s news stories. “It’s a good way to try to get them tied into watching current events,” he says. “Even students who have no interest at the end of the simulation or no interest in pursuing careers in the markets and will never invest themselves pay more attention to current events for the duration of the simulation than with under any other type of activity I’ve ever done.”

For business-minded students, the Game has been a way to help them think about career paths involving investing. For others, it’s been a way to help advise their parents about investing in stocks. “Students with more of a political science orientation focus on how the breed of capitalism we have is a connection between a free market, but a free market that has government entanglement and regulation,” he observes.

Newman says the Game has been eye-opening for him as well. “When I first started teaching, my interaction with the market was nil,” he recalls. He credits the training he got from Economics Arkansas for taking him from having no real knowledge of how the markets ran to being able to tie that to his government curriculum and being able to help his students make good advisement decisions. “It’s helped fill a gap in my own education,” he says. I graduated from high school in 2004, which wasn’t all that long ago, and I would have loved to have had access to this.”

ADDITIONAL SUGGESTED READING:

https://www.thisiscapitalism.com/economics-arkansas-financial-education/

https://www.thisiscapitalism.com/dr-bessie-moore-a-financial-literacy-pioneer/