How Can a Person's Ability to Reach a Savings Goal Be Affected by Their Choices?

Grade: 4 Lesson #8 How can a person's ability to reach a savings goal be affected by their choices? SS.4.FL.2.4 Discuss that whenever people buy something, they incur an opportunity cost. Opportunity cost is the value of the next best alternative that is given up when a person makes a choice. SS.4.FL.3.4. Identify savings goals people set as incentives to save. One savings goal might be to buy goods and services in the future. Correlated Literacy Standards LAFS.4.RI.1.1 Refer to details and examples in a text when explaining what the text says explicitly and when drawing inferences from the text. LAFS.4.RI.3.7 Interpret information presented visually, orally, or quantitatively and explain how the information contributes to an understanding of the text in which it appears. LAFS.4.SL. 1.1 Engage effectively in a range of collaborative discussions(one- on-one, in groups, and teacher-led) with diverse partners on grade 4 topics and texts, building onothers’ ideas and expressing their own clearly.

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1 SS.4.FL.2.4 Discuss that whenever people buy something, they incur an opportunity cost. Opportunity cost is the value of the next best alternative that is given up when a person makes a choice.

SS.4.FL.3.4. Identify savings goals people set as incentives to save. One savings goal might be to buy goods and services in the future.

Is It Worth It? Lesson Number: 8

Correlated Florida Standards  LAFS.4.RI.1.1  LAFS.4.RI.3.7  LAFS.4.SL. 1.1

Essential Question How can a person's ability to reach a savings goal be affected by their choices?

Learning Goals/Objectives  Identify opportunity cost.  Identify the opportunity cost of a decision given two or more alternatives.  Describe how opportunity costs affect savings goals.  Identify a savings goal.  Explain that people must make spending and saving choices to meet goals.

Overview Students view a video of the book Uncle Jed’s Barbershop. The book is about an African-American barber who, despite significant setbacks, saves enough money to buy his own barbershop. From the story, students learn about saving, savings goals, opportunity cost, and segregation. Students will also participate in a card game to further investigate what it takes to reach a savings goal.

Materials  PowerPoint Presentation (Included in Lesson File)  Video- Uncle Jed’s Barbershop https://www.youtube.com/watch?v=0OfXXTMrMg8  Two dice and two calculators for each group  Handout 1, Registrar one for each group (Included in Lesson)  Handout 2, cut apart for each group and bag, basket or box to put cards the in (Included in Lesson)  Handout 3, cut apart for each group and bag, basket or box to put cards the in (Included in Lesson)

Time 30 minutes

Activity Sequence INTRODUCTION/HOOK (5minutes) 1. Display PowerPoint presentation slide 1.  Tell students that in today’s lesson they will learn about saving goals and opportunity costs.  Brainstorm with students about goals they have for buying goods and services in the future.

2 2. Display PowerPoint presentation slide 2 Introduce student to vocabulary words: Alternatives, opportunity costs, saving, savings goal, bank failure Definitions are provided in the slide 3. Display PowerPoint presentation slide 3 Introduce the essential question. 4. Display PowerPoint presentation slide 4 Tell the students to analyze the image and predict what the story is going to be about. Ask volunteers to share their thoughts.

ACTIVITY (20 Minutes) 5. Display PowerPoint presentation slide 5 Play the read aloud video for students. https://www.youtube.com/watch?v=0OfXXTMrMg8  Tell the students that saving means not spending money now but instead keeping the money to buy things in the future. In the story what was Uncle Ned saving for? A barbershop What goods or services have you saved for? Answers will vary.  Tell students that a savings goal is any good or service for which you are saving. In the story what was Uncle Jed’s saving goal? A barbershop  Tell students that alternatives are the different possibilities we choose from in a given situation. Whenever the choice is made, something is given up. That is an opportunity cost. An opportunity cost is the best alternative that we give up when we make a choice. What choices did Uncle Jed Have to make in the story?Give his savings to his brother, Sarah Jean’s Father for her surgery or open his barbershop. What was Uncle Jed’s Opportunity Cost? The opportunity to open his barbershop.  Why did people during the Great Depression become very poor? People that put their savings in the bank lost all their money because the banks failed. Bank failure happens when a bank goes bankrupt. Today banks have insurance to protect people’s money in case of banks failure.  As poverty increased during the great depression people did not have money, how did the people in the story meet their needs and wants? They traded goods and services.  How did people pay Uncle Jed to cut their hair, if they did not have money? They paid with vegetables from the garden, eggs, and prepared meals for Uncle Jed.  What was their opportunity cost? The food they chose give up and not use for themselves or trade it for something else.

6. Display PowerPoint presentation slide 6 Play the Saving and Spending Game: In this game, you will take turns rolling dice and drawing cards in order to reach your savings goal—a new video game that costs $50.

Follow these directions: 1. Create teams. Divide the class in two groups. (This game can be done in small groups. ) 2. Assign one student from each team to be the recorder and two others to be the calculators. The recorders will record information in the registrar and the calculators will calculate the balance as students play the game. 3. Provide each group with a bag with the spending and savings cards.

4. Tell a student from each group to throw both dice and multiply the two numbers on the cubes. 5. The recorder writes this number in the “Amount” column on the register next to the number “1.” 6. Each player draws a card from the bag with cards. They read the event and the recorder writes the event in the “Event” column on your register. Place the card in the used pile. 7. The players will determine if their event card describes saving or spending. If your card describes saving, the recorder enters a “+” in the “+ or –” column on the register. If the card describes spending, enter a “–” in the “+ or –” column on the register. 8. The calculator will determine the balance by adding or subtracting the amount in the “Amount” column from your previous balance based on your entry in the “+ or –“ column. The recorder will enter the new balance in the “Balance” column. 9. The students continue to take turns rolling the dice, drawing cards, and making entries on the register until they have saved the $50 or more they need to get the new video game. If students run out of cards before they reach the savings goal, put the cards back in the bag, shuffle the cards and continue to draw cards from the pile. 10. The team to save the money first is the winner.

7. Display PowerPoint presentation slides 7 The following questions appear in the slide. Discuss with students the answers to the questions.  How many weeks did it take each group to reach the savings goal? (Answers will vary.)  What made it difficult to reach the savings goal? (Answers will vary but may include drawing cards for spending, rolling low numbers on the dice and then drawing a saving card, and rolling high numbers on the dice and then drawing a spending card.)  Did any groups ever have less than zero in their balance at any time? (Answers will vary.) What does less than zero money mean? (had to borrow)  Why is it harder to reach a savings goal in real life or in the saving and spending game? (Answers will vary.)  In real life, which are easier to achieve—savings goals that cost a little bit of money or savings goals that cost a lot of money? (savings goals that cost a little bit of money) Why? (It takes longer to save for savings goals that cost a lot of money because more money has to be saved and because more things arise to spend cost a lot of money because more money has to be saved and because more things arise to spend.

CLOSURE 5 Minutes 8. Display PowerPoint presentation slides 8  Have students discuss how their initial interpretation of the image has changed. Encourage students to support their answers with evidence from the lesson.

 Students answer the essential questions in their notebook. Ask volunteers to share

Sources/Bibliographic Information that contributed to this lesson Hill, A. T. (2016, January 15). Federal Reserve Bank of Philadelphia. Retrieved from http://www.stlouisfed.org/education_resources.

OPTIONAL EXTENSION SUGGESTION/HOME LEARNING

 Home Learning Activity Students will complete Handout 3

4 Uncle Jed’s Barbershop

Handout 1: Saving and Spending Register

Team Members’ Names: ______

Savings Goal: A new video game = $50 Week Amount Event + or - Balance Number $0.00 1 2 3 4

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9 10

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© 2010 Federal Reserve Banks of St. Louis and Philadelphia Permission is granted to reprint or photocopy this lesson in its entirety for educational purposes, provided the user credits the Federal Reserve Banks of St. Louis: www.stlouisfed.org/education and Philadelphia: www.philadelphiafed.org/education Handout 2: Saving and Spending Cards

You lose money somewhere on the You make a way home from donation to charity. school.

You spend You buy candy money going at a store. to the movies.

You buy a You give money birthday to your little present for sister. a friend.

6 You pay your dues You collect your to your recreational allowance. club.

You buy a toy at a You collect your store. allowance.

You buy an ice You pay your cream cone from a library fines. street vendor.

You are paid to Your aunt gives substitute on your you money. friend’s paper route.

You are paid to do You collect your some yard work for allowance. a neighbor.

8 You collect change You collect your from around the allowance. house.

You pet sit for your Your mother gives aunt and uncle. you money.

You are paid to You make money complete extra selling lemonade in chores around the front of your home. house.

Assessment Directions: Read the following story and answer the questions that follow.

Juan goes to the mall with a few of his friends. At the mall he gets to interact with the latest smart phone. Now Juan wants to buy it. So went he gets home he tells his mom. She tells him that he has to save the money to purchase his own smart phone. The phone Juan wants $399.99. So Juan began to save for his first smart phone. Most of the time Juanis very good about staying on track towards his savings goal, by week 10 Juan had saved $175.00. This week the county fair is in town and he decides to go with his friends. At the fair he spends $55.65 on admission, ride tickets, food, and drink. Juan continued to save towards his goal. After 20 weeks of saving towards his goal he finally saved $399.99 to buy his first smart phone.

1. What is the definition of saving? ______

2. What is the definition of savings goal? ______

3. What is an opportunity coat? ______

4. What was Juan’s savings goal? ______

5. How much did Juan have to save to reach his goal? ______

6. How long did it take Juan reach his savings goal? ______

7. Could Juan have reached his savings goal faster? ______

If yes, what choices could Juan have made in order to reach his savings goal faster? ______

8. What was Juan’s opportunity cost? ______

9. How did the opportunity cost affect Juan’s ability to reach his goal? ______