In this lesson, students will learn personal financial management strategies based on budgeting. Students will learn the theoretical concepts involved with budgeting and financial management, including income, expenses, savings, and debt; and will then watch a clip of What's Up in Finance? to see how a college student learned to manage his budget. Students will then complete hands-on activities to create three different saving and spending scenarios based on their own lives and expenses. The amounts of money spent and saved will differ in each scenario, with scenario 1 having some debt, scenario 2 having no debt but almost no savings, and scenario 3 having significant savings. After completing these activities, students will use the online interactivity "Bank It or Bust" to utilize the financial management concepts and strategies they have learned.

As a final activity, students will brainstorm ways to manage their own budgets while making room for investments, like classes, that will help their personal development in the long run. In this way, students are examining ways to save money to "invest" in themselves, for a return in their lives over the long-term.


TIME ALLOTMENT: 3 classes at 45 minutes per class

SUBJECT MATTER: Math, Finance, Economics


Students will be able to:
  • Understand the components of a budget
  • Compute savings
  • Compute debt
  • Learn financial management
  • Learn the nature of opportunity costs
  • Understand the importance of self-regulation

  1. National Council of Teachers and Mathematics
    Principles and Standards for School Mathematics

    Number and Operations
    • Understand numbers, ways of representing numbers, relationships among numbers, and number systems;
    • Understand meanings of operations and how they relate to one another;
    • Compute fluently and make reasonable estimates.

    Problem Solving
    • Build new mathematical knowledge through problem solving;
    • Solve problems that arise in mathematics and in other contexts;
    • Apply and adapt a variety of appropriate strategies to solve problems;
    • Monitor and reflect on the process of mathematical problem solving.

    • Create and use representations to organize, record, and communicate mathematical ideas;
    • Select, apply, and translate among mathematical representations to solve problems;
    • Use representations to model and interpret physical, social, and mathematical phenomena.

  2. JumpStart Coalition for Personal Financial Literacy

    Money Management
    Students will be able to:
    1. Explain how limited personal financial resources affect the choices people make.
    2. Identify the opportunity cost of financial decisions.
    3. Discuss the importance of taking responsibility for personal financial decisions.
    4. Apply a decision-making process to personal financial choices.
    5. Explain how inflation affects spending and investing decisions.
    6. Describe how insurance and other risk-management strategies protect against financial loss.
    7. Design a plan for earning, spending, saving, and investing.
    8. Explain how to use money-management tools available from financial institutions

  3. Mid-continent Research for Education and Learning (McREL)
    Benchmarks for Economics

    Standard 1
    Understands that scarcity of productive resources requires choices that generate opportunity costs

    Standard 7
    Understands savings, investment, and interest rates



watch video
What's Up in Finance, "Moving Out" segment

Web site:

The goal of this game is to budget expenses with the aim of saving for a short-term purchase (a car), and to see the results of saving over a long-term for a larger purchase (a home). The player is a teen working a full-time retail job for the summer. The player will develop a weekly budget of expenses, modifying their behavior so as to create savings. Then, the player will move through the ten weeks of summer vacation, with each week presenting an opportunity for savings or spending.


Teachers will need the following supplies:
  • Computer with connection to a screen or television on which to project the Web-based video clips, or computer stations where students can watch the clips
  • Board and/or chart paper
  • "Financial Management Terms" Teacher Organizer
Students will need the following supplies:
  • Computers with internet access (for individuals or groups)
  • Notebook or journal
  • Pens/pencils
  • Calculator
  • "Dreams for the Future" Student Organizer
  • "Debt/Savings" Student Organizer

  1. Bookmark the Web sites used in the lesson on each computer in your classroom, or upload all links to an online bookmarking utility such as

  2. Preview all of the video clips and Web sites used in the lesson to make certain that they are appropriate for your students, currently available, and accessible from your classroom.

  3. Download the video clips used in this lesson onto your hard drive or a portable storage device, or prepare to stream the clips from your classroom.

  4. Print out the "Financial Management Terms" Teacher Organizer, to copy the terms and definitions on the board.

  5. Print out the Student Organizers: "Dreams for the Future" and "Debt/Savings," and make enough copies so that each student has one copy of each organizer.

  6. When using media, provide students with a FOCUS FOR MEDIA INTERACTION, a specific task to complete and/or information to identify during or after viewing of video segments, Web sites, or other multimedia elements.


  1. Open the discussion by asking if any of the students have saved money, or maintain a budget of any kind.

  2. Write the following terms and their definitions on the board: budget, income, expense, savings, and debt. (see "Financial Management Terms" Teacher Organizer)

  3. Discuss with the students what each term means, and how savings and debt are a result of different combinations of income and expenses.

  4. Discuss with the students any dreams they have for the future, and what investments they could make now to achieve those dreams. For instance, if one person would like to play in a band, they may need guitar lessons now to achieve that dream in the future. Ask the students to explain how they might save enough money to pay for the current expense necessary to achieve that dream.

  5. Pass out the "Dreams for the Future" Student Organizer to each student. Ask students to brainstorm four different dreams for the future, and the steps they need to take now to achieve that dream, along with the potential cost of the current steps.


  1. Now ask if any of the students have thought about living on their own. Make a list of some of the costs that students might have to consider if they were living on their own (for example: rent, food, transportation, laundry, phone and internet, entertainment).

  2. Explain to the class that they will be watching a short video where they will meet Eddie, a young person who is living on his own for the first time. Eddie has faced some challenges maintaining a budget and saving money.

  3. Provide students with a FOCUS FOR MEDIA INTERACTION, asking them to think about the areas where Eddie could spend less money.

  4. Play the "Moving Out" segment for the class.

  5. Have a short discussion about the "Moving Out" segment that was viewed, stressing to students that Eddie had to re-work his budget in order to afford his dream: attending a four-year college. Review some of the ways Eddie adjusted his budget to spend less money.

  6. Ask students to discuss why attending a four-year college might help Eddie achieve his future goals.

  7. Hand out the "Debt/Savings" Student Organizer. Explain that this is a template to use for hypothetical budgets. The students will be filling them out based on their own expenses or projected expenses, but all the scenarios assume that the students are making $500 a month in income.

  8. Ask students to complete the column titled "Scenario 1: Debt" with as much expense as they would like in each category. They need to spend more than $500. If the students think of additional expenses beyond those listed on the organizer, they can add them below "Books/Magazines" on the chart.

  9. Students will then add up their expenses, and subtract them from the income figure of $500. The expenses should be higher than $500, so the total will be negative. This means the students have gone into debt and the debt figure should go in the "Debt" row.

  10. Next, ask students to fill out the column titled "Scenario 2: Break-Even." The goal here is to spend exactly $500. This means that students will have to lower their expenses in certain areas from the "Debt" column.

  11. Students will add up their expenses to confirm that their expense and income totals are equal. They will then have no savings or debt, so a "0" should go in the "Debt" and "Savings" rows.

  12. Then, ask students to complete the column titled "Scenario 3: Savings." The goal with this column is to lower their costs below those of the "Break-even Scenario" in order to have savings.

  13. Students will add up their expenses and subtract the total from the income figure of $500. This figure should go in the "Savings" row.

  14. Discuss with students how they were able to achieve savings. Ask students how they set their spending priorities in order to lower some expenses, and ultimately save money.

  15. Explain that the students will play the online interactivity "Bank It or Bust" to utilize the financial management concepts and strategies they have learned. In "Bank it or Bust," the students will create and modify a budget, and then stick to it for ten weeks with the goal of saving up to buy a car. Provide students with a FOCUS FOR MEDIA INTERACTION, asking them to play the interactivity and to be able to list some strategies for saving money.

  16. After the students have finished playing "Bank it or Bust," review some of the savings strategies they used in the interactivity. Ask the students if they can name things that happened to them during the game that provided them with extra cash (answers will vary). Ask them to name some "emergencies" that occurred that required to students to use some of their savings (answers will vary).


  1. Ask students to take out their" Dreams for the Future" Student Organizer and to think back to the initial discussion regarding their dreams. Have the students review the monthly cost of the current activities they brainstormed - the "personal investments" that would help them in the future.

  2. Next, ask students to take out their "Debt/Savings" Student Organizer, and look at their figures for "Scenario 3: Savings."

  3. Students should look at the monthly savings figure, and determine if they have saved enough for their "personal investment."

  4. If students have not saved enough for their "personal investment," they should re-work their Savings Scenario on the Student Organizer one more time to come up with the necessary monthly savings to cover these investments in their personal development.

Lesson plan written by Melissa Donohue


For Teachers For Students