Challenging Budget Exercise for a High School Class

Challenging Budget Exercise for a High School Class

Challenging Budget Exercise for a High School ClassOur post today is from Emily, a graduate student in North Carolina who blogs over at Evolving Personal Finance. She frequently writes about money in marriage, living well on a grad student stipend, and how to line up your budget with your values. Thanks for your help while I’m swimming in 1099’s!

I was recently watching an episode of Dawson’s Creek (don’t judge me!) and the storyline was that Dawson and his friends received an assignment in their economics class to put together a budget for various hypothetical lives. Of course, as I am a PF blogger who loves budgets almost as much as Jake does, my ears perked up. I’ve run across this scenario a few times in pop culture – a class has to pretend to be grownups for a little while, generally in male-female pairs for dramatic or comedic effect. I never had this experience in school personally but it sounds both challenging and fun.

The way the Dawson’s Creek scenario – “Alternative Lifestyles” – was set up was that each pair was given a life situation into which they must create a year’s budget. The scenarios given out were:

  • well-to-do gay couple about to be married (pediatrician and advertising executive)
  • successful single mom with 2 kids
  • lower-middle-class married couple with 3 kids (bus driver and sales clerk)
  • high-earning married couple with 2 kids in college (stock broker and engineer)

Of course the stereotypical joking squabbles ensued – a “husband” who wants a Viper, two guys arguing over their honeymoon, high school students apartment-hunting, etc.

I thought that this budget exercise was well-constructed in that the students had to create a comprehensive one-year budget and they all had different scenarios to work out. What I chiefly thought was silly, though, was assigning careers and income levels to the students that might not be the least bit relevant to their lives. Joey put it best in the episode when she said “This assignment is so lame. I mean, pretending to be something we’re never going to be, budgeting money we’re never going to have – I mean, what’s the point?” Dawson answers, “The point is to get us thinking about economics problems that we will face in the real world.” I hope my proposed assignment will fulfill Dawson’s ideals while addressing Joey’s objections and not only teach the students how to budget but spur them to consider what they want out of their own lives.

1) Ask the students (before they think about incomes) to pick a profession. They will research the starting salaries in that profession – say, one year out from the necessary training required, or however close they can get – as well as the median amount of debt incurred. Students who say they want to be medical doctors will see that their high incomes are hampered by a lot of debt and those who want to be artists may find that they need another gig at first.

2) Each student will pick a city to live in, and no more than two people can pick the same city. They will research the cost of living in that city and write their full year’s budget. The students will need to make reasonable assumptions about their lives and what will happen during the course of that year, like if they want to upgrade their car, buy furniture, or start saving for a house down payment.

3) After completing a full draft of the budget, the students will get together in small groups to receive feedback from classmates and the teacher. They will correct their drafts based on the criticism and ideas of their classmates and submit their reports.

4) Now for the fun (?) part! Students pair up to work on a combined budget, giving them the challenge of working on a budget and communicating about money and values with another person. They will fast-forward 20 years to a “mid-career” salary for their chosen professions. Since they will be able to use one of their previous budgets as a starting point, there will be a few new challenges around which they have to rebalance their budgets:
• research the housing market in their chosen city and decide on a house to buy and mortgage to sign up for
• draw a card to be assigned a number of children
• draw a wild card “Game of Life”-style scenario – like a large purchase that must be made, a health emergency, or an income reduction

5) The pairs will present their updated budgets and house choice, explaining their research and their decisions. I expect that each budget will require deeper research in different ways, which will allow the students to learn about many different careers, cost-of-living in various cities, and how to adapt to wrenches thrown into their money management. The students will again receive feedback from their peers, then write up a report and submit it.

Bonus: For extra credit, a student can research a popular PF guru and sum up his/her view of how to budget in a presentation to the class so they are exposed to different methods and values.

Phew! That seems like a long project (a lot longer than the week in the episode), but I think it hits on many of the major points that the students will have to deal with in their lives – choosing a profession, working with a partner, dealing with debt, deciding on a mortgage, and of course balancing a budget! I think it’s worth it to spend the time to start learning some of these skills and thinking long-term before choosing a college, a major, where to live, and a spouse.

Did you ever receive a budgeting assignment in school or through another activity? What would you add or remove from the project I outlined? Were you thinking about your future salary when you were in high school – or do you wish you had?

meme generated by Meme Generator

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Comments

  1. LOVE this post–Financial education is sorely lacking for our children/teens/college students. I like how you added the “wild card” aspect because that’s what life is: A series of interesting happenings that often have an impact on our finances–there’s really no way to know what can happen, but we can prepare!
    The Happy Homeowner recently posted..Would You Ever NOT Pay Your Bills on Purpose?My Profile

    • I think if students did this – especially with the wild cards – it would probably be the best peek into how other people handle their finances that they’ll get in their whole lives (unless they become PF bloggers!). I think it would be boring to hear presentations if everyone had exactly the same assignment, even in different cities.
      Emily @ evolvingPF recently posted..Contributing to Last Year’s Roth IRAMy Profile

  2. I never had a budgeting exercise in high school, but think that teaching basics like a simple budget could be a huge benefit to many students. I like the points you have for them to cover. I think another good thing might be to also provide them with some budgets of real life people (anonymous of course) to have them see what they would do differently, or the same.
    John S @ Frugal Rules recently posted..Losing Isaac – Finding Life in the Death of a ChildMy Profile

  3. I wish! This is great! The education system did not teach me how to budget or talk about personal finance at all my parents taught me. We learned about math and accounting in school but never worked on a personal budget or researching careers. I hope that educators work this into the curriculum to prepare students if they haven’t already. Some say education should start at home but what happens if your own parents can’t figure it out.. how can they teach you? Great post.
    Canadian Budget Binder recently posted..Becoming A Single Homeowner – Part 3 “Mortgage Options”My Profile

    • My parents didn’t teach me anything about money management aside from the math necessary, nor did my school. (Actually my husband tried to take an accounting class at our college and was told it was “too applied” to count for his distribution credits!) Thankfully I fell into the topic early on in the process of becoming independent from my parents, but so many don’t. The public school system should try to step in a bit more – maybe the parents can learn alongside the children!
      Emily @ evolvingPF recently posted..Contributing to Last Year’s Roth IRAMy Profile

  4. I wish we would have had an exercise like this when I was in high school!!! All joking aside, it would have been helpful.
    Holly@ClubThrifty recently posted..Types of Investments: Slicing Through The MystiqueMy Profile

  5. I never learned anything like this is school. I do think teaching some basica financial literacy is important, but as you have mentioned above, what class do you teach it in? I know with my busy schedule I’m not sure I would have had time… I might have had to give up taking “swimming and lifesaving” or “early release”

  6. The closest I came to this in school (1977)was when we were sent during class time, about once a month, to the local grocery store. We kept track of the prices of certain products over the course of the year. The only thing is, I don’t remember the teacher, doing too much with this info.
    I think these type of real life scenerios are great. I remember reading another blog, where a teenage girl wrote her experience. In her school class they had an assigment on the cost of groceries for a family. Her mom was on a very low budget, and they lived very frugally, making many things from scratch. She got a failing grade, because the teacher didn’t believe anyone could survive on such a low budget. It really affected this young woman. too bad the mom didn’t go to the school to protest. I would have.

    • The late ’70s were a time of high inflation, right? Is that why you were tracking prices – because they were changing noticeably? I guess it’s good to learn to pay attention to these things but I think budgeting would be even more useful, especially if there’s no conclusion or takeaway lesson to the tracking.

      Wow, that is a crazy story about that failing grade. My parents weren’t ones to go to bat for me at school, but I bet they would have intervened if I was being called a liar.
      Emily @ evolvingPF recently posted..Contributing to Last Year’s Roth IRAMy Profile

  7. I wish we got a budget assignment in school, I didn’t even know what a budget was until I graduated, sad.
    catherine recently posted..Our Budget Friendly WeddingMy Profile

  8. Emily, thanks so much for the awesome post! One of my passions is to teach persnoal finance to young people, specifically those in high school, as they start seeing the money roll in from jobs. It’s why my motto is “just because you make money, doesn’t mean you know what to do with it!” An exercise like this could show them some real world examples of how to manage the money they are now seeing.

    Again, thanks for helping out today! 🙂

  9. Unfortunately, we never had an exercise like this. It’s awesome! You tackle about 20 different problems people face all in one fun assignment.

    I thought about salary in high school but wasn’t realistic about combining my skills with salary. I wanted to go into law because it paid well….but I wasn’t at all cut out for that. I wanted to be an architect but couldn’t draw. It took me far too long to find a path that fit because we didn’t teach this stuff AND I wasn’t looking.
    Average Joe recently posted..Zillow’s Top 10 Cities To Find True Love – 2 Guys and Your Money 029My Profile

  10. I think only nerds like us would think this was fun! And even back in high school we probably wouldn’t think it was.

    I never truly saw myself in one of “the professions” even though I liked school – and I still have no idea what my career(s) will end up being though I look a lot!
    Emily @ evolvingPF recently posted..Contributing to Last Year’s Roth IRAMy Profile

  11. I didn’t have anything like this in high school either. It would have been nice though. Too many students graduate having no clue how to handle money. Most follow what they learned from their parents and if the parents were bad with money, you can rest assured that the kids will be as well.

    Sadly I don’t see personal finance being focused on in school since we are so obsessed with math, reading and science score from a test.
    Jon @ MoneySmartGuides recently posted..Many American’s Taking Loans From 401kMy Profile

  12. I’ve definitely never received an assignment like that in this type of detail. I have a friend who is a teacher of a business elective class. I will be forwarding her this email.
    Brick By Brick Investing | Marvin recently posted..What Is A Cash ISA?My Profile

  13. I’ve never had any sort of assignment like that. I think it would be great if more schools taught practical personal finance though! I was terrible at budgeting until I married my husband at 23 (he is an excel genius).

    Also, I love that meme. That is how I feel about where I live (Bellevue).

  14. I like your version much better. I noticed that none of the budgets started out low income or working-class, which is commonly where you end up if you don’t land a career out of college. I feel like the show completely exemplifies the midset of the 90’s. College equals middle class.
    Wayne @ Young Family Finance recently posted..Simple Ways to Save MoneyMy Profile

  15. I’ve never earned more than $14 hr and worked as a regular factory worker. Young people (especially) need to be taught it really doesn’t matter how much you earn, it’s how much you spend.
    As long as you live below your means and save/invest the rest you are way ahead of the game.

  16. I love this exercise. Teaching economics and throwing in PF is one thing I’ve considered after reaching FI because I know I won’t stay with my current job. Although teaching would be a much bigger headache because just listening to the BS from my wife about what’s going on at her school gives me a headache.
    JC @ Passive-Income-Pursuit recently posted..Recent TransactionMy Profile

    • The first version of this exercise was a lot more involved, but my husband helped me tone it down by reminding me about how normal high school students operate. If you don’t want to teach in public HSs maybe you could teach through other organizations where people will opt in? That way you get at least willing participants. Even if you force this material on everyone there’s no guarantee they will absorb it and keep the lessons for later.
      Emily @ evolvingPF recently posted..The Month I Had an $11 Electric BillMy Profile

  17. When I was in 7th grade we had to choose a future profession then make a budget based on the salary we’d be receiving. I was a pediatrician (that was before I knew you had to be good at and interested in chemistry, not just interested in working with kids-who knew?). It was a really fun and valuable exercise.
    KK @ Student Debt Survivor recently posted..Financial Lessons Learned From My 80 Year Old GrandmaMy Profile

    • Hey, bingo! Glad to hear something like this was implemented somewhere! I think it’s a bit of a stretch to ask middle schoolers to come up with a reasonable career because they probably haven’t had exposure to really challenging academic subject matter yet, like you said. But even making a budget with an inappropriate career is better than not doing the exercise at all!
      Emily @ evolvingPF recently posted..Grad Student Income Tax Site Up!My Profile

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  1. […] Challenging Budget Exercise for a High School Class on I Heart Budgets […]

  2. […] One thing I wish I learned more about in High School was budgets and our friend Jacob at IHeartBudgets shares a challenging budget excersice for a High School class. […]

  3. […] a guest post go up at iHeartBudgets (I wrote it a long time ago, haha) this week.  I constructed a personal finance project for high school students inspired by an episode of Dawson’s Creek I recently saw.  Please head over there and leave […]

  4. […] I also had one guest post published at iHeartBudgets – Challenging Budget Exercise for a High School Class. […]

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