Federal Reserve Bank of San Francisco: Personal Finance

Objective: Activate prior knowledge and spark curiosity.

Teacher says:

“Today’s class will focus on the relationship between education and income. To start, let’s think about budgeting—something we all deal with.”

Instructions:

1. Write the words budget, income, and expense on the board.
2. Ask students:

• What is a budget? (A plan for spending money.)
• What is an expense? (Anything you spend money on.)
• What is income? (Money you earn.)

   3. Discuss a few student examples to ensure understanding.

Objective: Preview lesson goals and engage students in group-based budgeting.

Teacher says:

“You’re going to step into the shoes of someone living on a specific income. Your job will be to make decisions and see how education affects what people can earn, and how they spend.”

Instructions:

1. Distribute: Handouts

• • Handout #1: Budget Sheet
  • Handout #2: Budget Card (one per student; four scenarios per sheet)
  • One 3x5 card per student

  2. Instruct students to read both sides of their Budget Card.

Objective: Guide students in calculating a personal budget based on income level.

Instructions:

1. Assign students to color-coded groups based on their budget card.
2. Ask them to bring materials and sit with their color group.
3. Within groups, students calculate monthly budgets individually using their Budget Card and record data on their Budget Sheet.
4. Display Visual Aid #1: Team Budget on the overhead/projector.
5. Allow 5–10 minutes for calculations and group discussion.

Objective: Collaborate to analyze budgeting data and reflect on economic inequality.

Instructions:

1. Call one volunteer from each group to record their budget totals on Visual Aid #1.
2. Have the rest of the class adjust their seating for a clear view
3. Discuss:

• • What do you notice about the data?
  • Why are the budgets different?
  • What factors influence income and spending? (E.g., education, job type, family size.)

  4. Ask a volunteer from each group to share the education level from their Budget Card. Record it beside their team’s total.

  5. Facilitate discussion:

• How does education impact earning potential?
   

Objective: Reflect and summarize budgeting concepts.

Instructions:

1. Ask students to write a response on their 3x5 card:
   • Why do people create budgets?
2. Invite a few students to share.
3. Summarize key point:

• “A budget gives you control over your money—it helps you make informed choices and avoid financial stress.”

Objective: Deepen understanding through reading and discussion.

Instructions:

1.  Distribute:

• Dr. Econ article: “What is the importance of developing job skills?”
  (Available from the Federal Reserve Bank of San Francisco:
  https://www.frbsf.org/education/teacher-resources/what-is-the-importance-of-developing-job-skills/)
  
  • Handout #3: Discussion Questions

2.   Students read and complete questions independently or in pairs.

3.  If time allows, bring the class back together for a brief discussion about the link between job skills, education, and long-term financial success.