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Volunteer Instructor Notes
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Key
Distribute Handout
Student Activity
Important Note
Go do it now!
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Some classrooms may not have the capability to play videos, or they may not have proper
audio equipment. Please check with the teacher before you begin presenting.
Introduce Yourself
Introduce yourself in a welcoming manner and make students feel comfortable.
Who are you?
What do you do?
Why do you volunteer for Make A Difference - Wisconsin?
What is Make A Difference - Wisconsin?
It’s an organization that delivers financial education to high school students
in Wisconsin.
We focus on providing teens with the financial education and tools needed to
form good financial habits.
Explain why financial education is important.
Set Ground Rules
Share these, or your own expectations for student behavior.
Participate: ask and answer questions.
Listen when others are talking.
Have fun.
Discuss how to earn an incentive (if you’re offering one).
Distribute Pre-Program Survey
Surveys will be completed at the beginning and end of all three lessons to gauge what students know before and after participating. This is important because it allows us to measure program outcomes.
Have each student complete a survey to determine their current knowledge and experience. Make sure students include their name on all surveys.
If students don’t know an answer, instruct them to select “I don’t know” rather than guessing.
Collect the surveys when complete. Do NOT review answers with students.
Transition: Let’s see what we’re going to cover in this lesson…
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Discussion Ask a question to get students talking right away.
Why is it important to form good personal financial habits?
Expand on student responses. Summarize why personal finance is important and share what the consequences of poor money management are.
Transition: Let’s get started by talking about income…
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Distribute “Sample Pay Stub” Handout Discussion
Does anyone have a job? Where do you work?
Have you ever seen your paystub?
What do you notice about your paycheck; what kind of info is on it?
Key Points
Ask students to identify John’s…
Hourly wage
Hours worked this pay period
Gross Pay
Net Pay
Stories, Examples & Notes
Transition: Let’s talk about what comes out of a paycheck…
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Discussion
What is automatically deducted from John’s paycheck?
What is FICA? (Federal Insurance Contributions Act)
Discuss what Social Security is and how it works. You can also comment on how contributions fund Medicare.
Key Points
A percentage of your income is taken out due to taxes.
FICA is taken out on all incomes up to $118,500.
Maximum Social Security = $7,347 and Maximum Medicare = 1.45% of total income with no income maximum. On $118,500 @ 1.45% = $1718
Employers also pay the same amount on behalf of each employee (and if self-employed you pay both)
Concerns related to long-range financing of Social Security:
Size of baby boom generation collecting benefits vs. size of the current workforce. A smaller group of people is funding a larger group.
Increases in life expectancy. People are collecting benefits for a longer period of time.
Long-term saving is required to reach retirement goals.
Transition: What other deductions come out of adult’s paychecks?
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Discussion
Key Points
Other deductions:
Health Insurance
Disability Insurance
Retirement Contributions
Stories, Examples & Notes
Transition: It’s important to understand what your net pay is when creating a budget and savings plan. Let’s talk about expenses next…
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Discussion
Ask students what they spend their money on.
After getting some responses, ask if anyone keeps track of how much they spend. Move to next slide.
Let’s say you have $100 and this is how you spent it. Are these realistic types of expenses that you have from time to time?
Someone do the math for me. What do the expenses add up to?
How much do you have left for the weekend?
Key Points
Stories, Examples & Notes
Transition: Let’s take a look…
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Discussion
How would you change your spending so you have more money available for the weekend or for savings?
Key Points
Small purchases add up quickly.
It’s important to know how you spend your money. This is the first step to creating a budget.
It’s important to plan your expenses and to live within your means.
Stories, Examples & Notes
Transition: When you are living on your own, it becomes even more important to understand your expenses and plan how to spend the money you make.
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Discussion
How much does it cost to live on your own?
What types of expenses will you have?
Key Points
When you’re living on your own, you will have a lot of responsibilities. Managing your finances well will be key for success.
Stories, Examples & Notes
Transition: Let’s look at an example of regular monthly expenses for someone living independently.
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Discussion
What types of expenses are missing in this example?
Clothing, entertainment, internet, car maintenance, car payment, unexpected emergencies, etc.
Key Points
To cover $1,300 in expenses per month, you would need to work 40 hours per week and net $8.13 per hour after tax. This means you would need to make $11 per hour gross.
You can reduce your expenses by having a roommate and making good spending decisions.
Stories, Examples & Notes
Transition: After high school, some of you will likely continue your education and some of you may enter the work force. Let’s talk about these options for a few minutes.
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Discussion
What are your plans for after high school? (school, work, possible careers)
If you decide to go to college, what’s it going to take?
If you decide to continue schooling, what can you do now to prepare financially?
Save money from a part time job for books, tuition, etc.
Distribute “College Justificator” Booklets
Review the College Justificator and discuss the “Lifetime Earning Potential” bar graph for the various professions.
Students need to plan for how they will pay for their education and understand the income potential they’ll have after obtaining a degree.
Higher education leads to higher incomes and potentially more debt. For example, an annual salary for a High School Dropout could be as low as $13,500 compared to $121,000 for those with a Professional Degree, while student loan debt can range from $10,100 to $93,200.
Key Points
The decision to enter the work force or continue your education is a personal choice. There’s no right or wrong decision. Do what is best for your situation.
You can be financially successful without a college degree; live within your means.
Look for scholarship opportunities. Work hard in school to get good grades and get involved in activities. Be sure you fill out the FAFSA.
Transition: Whether you go on to work or more school, it will take some planning to reach your goals…
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Discussion
What is a budget?
Review the answers on the next slide.
Key Points
A budget alone won’t keep you from going broke.
Budgets should be used to plan how you will spend your money. Following your plan leads to success.
Stories, Examples & Notes
Transition: Let’s take a look at how you build a budget…
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Discussion
What is a fixed expense and what is a flexible expense?
Key Points
A fixed expense is a recurring expense of approximately the same amount.
An expense is flexible when you have control over when and how much you spend.
Review the various components of a budget.
Income – Expenses = Potentials Savings. This needs to be a positive number!
Stories, Examples & Notes
Transition: Now we are going to create our own budgets...
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Distribute Budget Handouts: “Career Salaries & Expenses”
“Monthly Income and Expense Worksheet”
Budget Activity
Have students choose a career or assign the four careers equally across the class. Make sure all four careers are selected by or assigned to students. Feel free to let students work together.
Review the handout with students. Be clear that students should use their blank budget worksheet to create a budget for their career.
Help students get started by pointing out the income and expense categories. Students will need to choose whether they think each expense is fixed or flexible and then write it down on their budget worksheet.
Have students complete the math to come up with their potential savings.
Walk around and help students.
Give them a time limit and tell them to complete as much as they can.
Stories, Examples & Notes
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Discussion
Before moving to the answer slides, ask students to share what they calculated for each category.
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Discussion
Why does the surgeon have a lower savings amount than the Vet Tech and Librarian? (Large student loan debt, more expenses)
What is something you would like to save for and how are you going to do this?
Key Points
Savings aren’t determined just by your income. How you choose to spend your income is a key factor in saving money.
Even with a lower income, you still have the opportunity to save (eg. the housekeeper was able to save and spend money on entertainment).
Budgeting doesn’t mean you are trapped and can’t enjoy life. It helps you have enough money to enjoy your life—without the stress of going broke!
Stories, Examples & Notes
Transition: So how can you be sure to save money each month?
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Discussion
What do you want/need to save money for? Challenge students to set at least one goal and have them write it down. Ask for responses.
Key Points
Add “PAY YOURSELF FIRST” as a fixed expense in your budget.
This is important for:
Saving for future expenses and goals
Having money saved for emergencies or unexpected expenses
Investing for your future (e.g. going to college or moving into your own place)
If you get spending money or an allowance from family members, save a little of what you receive each time (e.g. 10-20%).
Stories, Examples & Notes
This is the Natural Lesson Break – End Session 1 Here
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Discussion
How many of you thought of something to save for? Ask for responses. What are some ways you can start saving(you can start with $1 a day)? Are there other ways to save more or spend less?
Key Points
Using a check cashing store may seem more convenient than using a checking account, but they have high fees.
If you’re doing Check It Out with this class, there’s no need to explain how check cashing stores work here. You will review it in more detail during the next lesson. If you’re not doing Check It Out, share the following:
Check cashing stores charge you a minimum fee of $4-$5. Some stores also charge up to 5% of the check amount (5% of a $250 check would be a $12.50 fee).
If you cash two paychecks a month, you could be charged five times as much as you would at a bank or credit union. In most cases, your bank or credit union cashes your check for free.
A payday loan or paycheck advance is a small, short-term loan that is intended to cover a borrower’s expenses until their next payday. Typical loans are $100 - $1500, they have a two week term, and they have interest rate charges in the range of 390-900%!
Stories, Examples & Notes
Transition: If you want to start saving, but you don’t have any money left after expenses, you have 3 options: 1. Increase your income; 2. Decrease your spending; or 3. Both. Let’s talk about “needs” vs. “wants” to help you see how to save.
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Discussion
What’s the difference between a need and a want?
Call on students and ask them if they view each item on the slide as a need or a want, and why. Explain that opinions may differ and that everyone needs to make personal choices.
Key Points
Some items like shoes may be a need, but buying a less expensive pair will help you save. Shopping around will help you find the best deal.
You should set spending priorities so you can get what you need/want and still have money to save.
Stories, Examples & Notes
Transition: Let’s watch a video of a real life scenario of wants vs. needs acted out by student actors.
Some classrooms may not have the capability to play videos, or
they may not have proper audio equipment. Please check with the teacher before you begin presenting.
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Discussion
What is compound interest?
Gauge how familiar the students are with this concept to determine how thorough your explanation should be. Ask a student to define “principal” and “interest?”
Key Points
Compound interest is interest that you earn on both the principal and the interest earned.
Stories, Examples & Notes
Transition: Let’s look at an example of how compounding works…
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Discussion
Key Points
Review this scenario and use it as an example of people saving for retirement:
Kelly learned about financial literacy in high school so she understood the benefits of saving early. She started saving right after college.
John had huge credit card debt when he graduated from college and it took him years to pay off. He didn’t know how important it was to start saving early so he waited until he was age 35.
Stories, Examples & Notes
Transition: Who will have more money at age 65? (After getting responses, review the next two slides.)
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Discussion
Why does Kelly end up with so much more money having only invested $12,000 vs. John’s $36,000?
Key Points
Stress how “time” is one of the most important ingredients in compounding/growing your money.
John ended up with nearly $100,000 less than Kelly at age 65 because he started saving later.
Stories, Examples & Notes
Transition: The type of product you choose to save/invest your money in has an impact on how fast it can grow. Let’s talk about some investment options…
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Distribute “Does the type of investment you choose…” Handout
Discussion
Ask a student to describe a savings account. After getting a response, review the description on the slide to fill in any blanks.
Ask a student to describe a stock. After getting a response, review the description on the slide to fill in any blanks. Ask students why people might believe Apple is a company that will grow and become more valuable over time. (Answer: They make innovative products that people like, want and will likely continue to buy. The more people buy the more money Apple is likely to make.) THIS IS ONLY AN EXAMPLE!
You can open a savings account NOW! Get help from a parent or find an institution where you can open an account without a parent. Accounts can be opened with as little as $5.
Key Points
You can open a savings account NOW! Get help from a parent or find an institution where you can open an account without a parent. Accounts can be opened with as little as $5.
Review the graph showing how over a long period of time, earning a higher rate of return (interest) makes a significant impact on how much money you accumulate.
Point out that by investing $100 a month once working full time, you have the potential to accumulate almost $500,000!!
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GO DO IT NOW!
Deliver each bullet as a reminder and a “call to action”. Challenge students to do some or all of the “Go Do It Now” tasks within the next 30 days from your lesson.
Distribute Post-Program Survey
Have each student complete a post-survey to determine their knowledge now.
Once students are finished, collect the surveys. Make sure there is a name on each one (remind students to use the same name they used on the pre-survey).
If time permits, you can go over the surveys with the class. Ask students to provide the answers. The idea here is learning by repetition; the students first saw the concept in the pre-program survey, then in-depth during the presentation, then again in the post-program survey, and now in this review.
Encourage students to join our Facebook page. We have pictures of program students, information on jobs and scholarships, and more.
Please return all surveys to Make A Difference – Wisconsin after
you have completed your entire program commitment. Thank you for making a difference!
Make A Difference – Wisconsin, Inc. 710 N Plankinton Ave. Suite 310
Milwaukee, WI 53203 414-273-8101
