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Video Games and Financial Literacy

The following games can be used to enhance 86 percent. Less than half of players financial literacy. Background on using real understood charges before playing, games in financial learning from recent while 82 percent did so afterward. And literature on the topic follows the game list. women said they felt more confident about handling after playing EverFi. www.everfi.com Practical Money Skills EverFi is a web-based simulation game http://www.practicalmoneyskills.com/games/ designed for individuals ages 16-24 that trainingcamp/. covers a wide range of financial topics. This This contains seven free games that link: can be embedded at no cost in other http://www.everfi.com/images/screenShots/EverFi . The most widely used is Financial LifeMap.jpg provides a screenshot. EverFi Football, a joint venture between Visa and contains many “virtual worlds” and the NFL. The game is accompanied by a interactive activities including a tour of the classroom curriculum designed for high NY Exchange and a used-car school students. Teams compete by dealership. EverFi offers a five-hour series of answering multiple-choice questions to earn Web tutorials. This is a SimCity-style game in yardage and score touchdowns. Financial which they control characters‟ spending Football has been distributed by 23 state habits, rewarding good choices and suffering governments to every public high school in the consequences of bad ones. those states. on the success of Financial Football, Visa recently released Doorways to Dream’s (D2D’s) Celebrity Financial Soccer (Financial Football outside of the US), an interactive FIFA-themed video Calamity game that tests users‟ knowledge of personal www.celebritycalamity.com. finances. Financial Soccer offers single player The game is designed for low-to moderate- and head-to-head game play options and is income females ages 18 to 32. Students being translated into a dozen different practice paying off card bills, learn how languages. This free game features three much they really pay for items when they difficulty levels – children, teens and adults – pay interest, and pick up a basic and has companion lesson modules for understanding of how to use credit. This classroom use. Visa will roll out Financial game‟s primary focus is credit . Soccer in over 12 countries in the months From D2D‟s website (based on n =44): leading up to the 2010 FIFA World Cup™. “These preliminary, small sample tests The 5 other games on this website are revealed that after 60 to 90 minutes of game Countdown to , Smart Money Quiz play, players showed increases of 15-30% in Show, Trip to Savings, Ed‟s , and financial self-confidence. In addition, key Puzzler. All seven games are based on knowledge questions reflective of core game the Practical Money Skills for Life program, teaching points showed 50-70% increases. which is Visa‟s widely used financial At the same time, these same players rated program. The program contains Celebrity Calamity as 4.27 (out of 5) for comprehensive money management fun.” Doorways to Dreams found that 55 resources and lesson plans tailored for use at percent of the players understood the home and in the classroom. meaning of annual percentage rate before playing, but afterward the figure climbed to

Page 1 of 4 Ekomini the game. The goal of Moneytopia is to make sound financial decisions and achieve www.ekomini.com financial goals over a multiyear period. Ekomini counts deposited coins through an Moneytopia takes players through 40 years online bank. The program is designed for of financial decisions, including where to live, children. Using a web-enabled coin-saver what clothes to buy, where to invest, and (piggy bank) kids deposit their money, see what bills to pay. To win, players must keep the amount deposited and how much has careful of their finances, pay their bills accumulated. on time, and manage all of the small day-to- day items that can impact their finances. ’s Stagecoach Island Players can use cash, credit cards, or high- http://blog.wellsfargo.com/stagecoachisland/ cost payday to pay their bills. Virtual world game originally developed Occasionally, players must deal with surprise through Second Life in 2006. Users can expenses such as a wedding or the birth of a connect with friends and learn money child. An investment advisor offers financial management. It has four neighborhoods: tips throughout the game. Isla Del Sol, Desert Hollow, Sapphire Springs, and Olympic Valley as well as a T. Rowe Price Associates and Disney’s The Learning Lounge with a virtual ATM. Users Great Piggy Bank Adventure. can earn money (shells) and save to buy land and start building a home. Users The Great Piggy Bank Adventure is a virtual virtual jobs, use credit cards, and take out board game that focuses on the importance home loans. of wise financial planning. The game is designed for children ages 8 to 14, and CentsCity parents are encouraged to play the game along with their children. Players learn about http://www.centscity.com/ important financial concepts and use these This program is unique because it allows lessons to complete the game and achieve parents to embed rewards in the program. their dream goals. The game‟s lessons cover (This could be something free such as more setting goals, saving and spending wisely, viewing time or items purchased the impact of inflation, asset allocation and through the site). The program is designed diversification. Players strive to collect as for ages 8-14. Focused on managing money many truffles as possible to reach their (i.e. creating a budget, checking versus financial goal. Players can invest in three , and balancing a piggy representing cash, bonds and checkbook), borrowing money (i.e. owning a . The returns vary with each round but , paying for college, and rent vs. are based on actual, historic returns in their mortgage), and growing money (i.e. buying respective markets. & selling stocks, owning a , and understanding compound interest). CentsCity Community Bank’s () Sir is aligned with national standards published by the National Coalition of Teachers of Save-a-lot’s Kingdom. Mathematics (NCTM) and the Jump$tart http://www.kids-save.com/home Coalition for Personal Financial Literacy Children list items they want to save for and, (National Standards in K-12 Financial if they wish, can upload pictures of those Education Standards; 3rd Edition, 2007). items. If they have more than one item they‟re saving for, they can allocate a FINRA’s Moneytopia percentage of savings to each item by using a simple priority slider. Users can see how http://apps.finra.org/moneytopia/moneytopi much they have saved toward their goal with a.html a progress bar that also allows them to FINRA created Moneytopia: The Big Dream transfer money from one goal to another. for servicemen and women and their spouses The game is designed to provide positive ages 18 to 24, although anybody can play reinforcement to children as they do chores

Page 2 of 4 and save toward the savings goals their literacy.” Financial Services Review, Vol. family has decided upon. Each time children 16, 2007, pages 105-116. log on, they record the completion of chores “Playing a game is consistently and whatever money they earned from their related to higher literacy scores, presumably parent(s). The game automatically allocates because the fun and interactivity of playing this money to their goals based on the such a real-time game provides the intrinsic priority slider, and all allocations can be motivation necessary for learning.” “For high viewed in the log. The program also features school students, motivation is a key factor to an online game that teaches children about becoming financially literate and trained saving and budgeting. This game, known as instructors who teach Sir Save-a-lot‟s Kingdom, allows children interactively through activities such as a from around the world to compete with each stock market game or other simulations are other by making virtual saving and spending certainly a start.” decisions that affect the growth of their village. Thus, the program features both an Lusardi, A., 2008, Financial feature and an interactive literacy: An essential tool for informed game. consumer choice? “However, a specific school-based Background on Real Games and Financial educational program that is consistently Learning related to higher financial literacy scores is the stock market game. Those who play a Mandell, Lewis (2008), “Financial stock market game in class do three to four Literacy in High School,” forthcoming in percentage points better than all students on Annamaria Lusardi (ed.), Overcoming financial literacy tests. This may provide the Saving Slump: How to Increase the some guidance on how literacy courses could Effectiveness of Financial Education and be improved upon.” “Courses can be Saving Programs, of Chicago customized and tailored to various needs and Press. levels of financial knowledge. Moreover, as Mandell says “The stock market game is the the evidence on the effectiveness of the only school-based educational program that stock market game in high schools seems to is consistently related to higher financial suggest, it may be important to find ways to literacy scores. Starting with the 2000 make courses engaging and to stimulate Jump$tart survey, when it was first interest in acquiring financial literacy.” measured, students who played a stock market game in class do 3-4 percentage Walstad, WB & Buckles, S. 2008. points better than all students. On a mean The National Assessment of Educational score base just above 50 percent, this Progress in Economics: Findings for translates to a 6-8 percent increase in General Economics. American Economic financial literacy. Although reasons for the Review. success of this activity are not clearly known, After examining factors that affect 12th- playing such an interactive game appears to graders‟ scores on a general economics stimulate general interest in personal assessment test, the authors write (and note finance. The 2006 survey shows that this is a top economics journal). “The students who played a stock market game in activity list included participating in Future class outscored the average in every subject Business Leaders of America, DECA (a category, not just in areas related to saving group), Junior Achievement, and investments” (p. 268)…“The stock economics-related clubs, academic market game again is found to be important: competitions, a stock market game or 40.2 percent of all financially literate simulation, a student-managed school store, students played a stock market game in and a student-managed or bank. class” (p. 271). Of the list, the only activity that shows a positive and significant relationship with test Mandell, Lewis and Linda Schmid scores was participation in a stock market Klein (2007): “Motivation and financial

Page 3 of 4 game or simulation, either as part of a class percentile, while students who did not play or as an extracurricular activity. Presumably the game scored on average above the 46th this activity reinforced economic ideas that percentile. Students who played The Stock they learn in a general economics course.” Market Game also significantly outperformed their peers in their knowledge of financial Cebula, R. & Toma, M. 2002 The concepts. In tests to measure Effect of Classroom Games on Student knowledge, elementary school students who Learning and Instructor Evaluations. played the game scored on average above Journal of Economics and Finance the 68th percentile, compared to an average Education. score above the 42nd percentile for students The authors evaluate the impact of who did not play the game. Students playing incorporating The Stock Market Game on the game in both middle and high school student performance and teacher evaluations scored on average above the 58th percentile, in eight upper level Money and Banking while their peers scored above the 42nd and university courses. “A test is conducted in 40th percentiles respectively.” which, ceteris paribus, student examination scores were observed to increase in the The study used a randomized controlled trial sample that included a in 600 classrooms nationwide. Half of those portfolio project…The results in the present classrooms played The Stock Market Game analysis suggest that students and half did not. 2,700 students were comprehended more of the material, and surveyed using self-reports. Learning Point assigned higher scores to their evaluation of also conducted a nationwide survey of the instructor…It is worthwhile to note that teachers of The Stock Market Game. very little other course material was altered or „crowded out‟ as a result of including the O’Neill, Barbara. 2008. Financial investment project…These findings are Simulations for Young Adults: Making tentatively attributed to the fact that it the “Real World” Real. The Journal of became readily apparent to the students how Extension. useful the classroom material could be in the http://www.joe.org/joe/2008october/2008de „real world.‟” cember/tt4.php This article describes 11 youth money Learning Point Associates (FINRA simulations including Mad Money. Grant to evaluate the Stock Market “Simulations are a useful tool for teaching Game) personal finance concepts. Keys to a http://www.learningpt.org/smg/SMG_Study. successful simulation experience are easy to pdf replicate materials, realistic scenarios, clear The Stock Market Game impacts student instructions for participants, and a thorough achievement in investment knowledge and debriefing where students discuss their math: “Learning Point‟s year-long study experiences and what they learned. found that elementary school students in Simulations provide an opportunity for Grades 4-6 who played The Stock Market students to appreciate the economic impact Game scored on average above the 55th of a post-secondary education and to percentile on the mathematics tests, while practice financial management skills such as students who did not play the game scored check writing and budgeting. In addition, on average above the 43rd percentile. they are interactive, which makes learning Students in Grades 7-10 who played the fun. game scored on average above the 54th

The University of Wisconsin-Extension (UWEX) Extension’s mission extends the knowledge and resources of the University of Wisconsin to people where they live and work. Issue Briefs are an ongoing series of the Family Financial Education Team. This brief was drafted by J. Michael Collins, Assistant Professor in Consumer Finance and Extension State Specialist. © 2010 Board of Regents of the University of Wisconsin System.

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