Our 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?
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