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Getting Started with a Classroom Economy and Class Money


Teaching financial literacy with a classroom economy can provide students with a memorable, real world experience. A classroom economy is an engaging tool to build into math talks. You can use it to assess learning skills, responsibility or character development.  As a new-ish teacher I had been looking for a way to include all the above into my lessons. I’m going to walk you through how I began using a classroom economy and what tools I used.
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Financial literacy using a classroom economy

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How I Taught Financial Literacy Using a Classroom Economy:

   I was approaching my first full year substitute job with a lot of nervous excitement and was trying desperately to organize my ideas related to managing my classroom.  Since I had a split grade class (grades 4 and 5), I figured that a good first step might be to give students jobs to do around the room.  After a productive class meeting the first week, we had a list of jobs for everyone that we could rotate through each week. Jobs ranged from organizing our coats and boots to watering classroom plants. I wanted to add an incentive for the students to actually do their jobs so I decided I would pay them. Teaching financial literacy was important to me and I wanted to incorporate it into our classroom routine.

Using Fake Money:

 I created a set of fake money using a website that allowed me to put my own face on pretty much any bill (see the samples below of both American and Canadian bills…there are other options on the site as well).  The kids were interested right away and they thought the money with my face on it was hilarious.  I started out paying the kids $100 each week.  Five crisp twenty dollar bills handed to each student on Friday afternoon.  The caveat was that I needed something for them to spend their money on.

financial literacy using a classroom economy
financial literacy activities
I decided that what I needed to do was provide them with some interesting things they could purchase.  A short poll of interests filled a “store” bin with skipping ropes, emoji themed items, bouncy balls, smelly markers, etc. We also added a new job to the list as store manager. 

How Students Develop a Deeper Understanding of Financial Literacy:

About six weeks into the year, I introduced the idea of having the students pay rent on their desks.  It did two things right away: first it gave me a reason to have them clean the accumulated junk out of their desks.  Second, it provided a reason for them to save a little bit of money from week to week. 
What happens when you don’t have enough money to pay rent? Well, I gave them the option to do extra classroom jobs not on the list or borrow the money from a friend.  Over the course of the year, five different students found themselves short on rent at least once.  One particular student had a very difficult time saving enough to pay rent, not having enough money for three months straight. I sat down with him and we made a plan.
This real world context was incredible for teaching financial literacy. 
financial literacy using a classroom economy

Teaching Financial Literacy with a Classroom Economy Continued:

Next discovery: Some kids are born entrepreneurs. I began to notice that several students had stores of their own and were selling basically anything.  School supplies of all types were trading on the black market.  I monitored what was happening but made the choice to let them experiment with business and finances and figure it out on their own.  You would need to decide if this is the right approach for your students as it might lead to other challenges.
           
            I began to see the learning happen and areas that we needed to work on.  Responsibility was a clear need for several students who couldn’t seem to keep track of their money.  Controlling our impulses was another big teachable moment. Three students were unable to pay rent two days after Hallowe’en but they were sporting pencil cases full of black market candy purchases. One student opened up a rental business that charged a membership fee and allowed other students access to an array of fidget spinners, theraputty, smelly markers, and a soccer ball to use during breaks.

The Downsides:

 There were some other downsides to our classroom economy.  We had a few instances early on of class wallets “disappearing”, only to have other students suddenly able to buy big ticket items from the classroom store.  A class meeting with a stern warning curtailed that activity.  Some students also seemed to find humor in other people’s lack of money. As a class there were lots of discussion about empathy, positive language, social justice, and mindfulness related to the issue.  Several times people who had borrowed money from a friend, denied having done so. This lead to some interesting conversations about banking, charging interest, and the need to secure collateral.  Those conversations were born out of the student’s inquiry.

More Ways to Develop Financial Literacy using a Classroom Economy:

Social studies: Ancient Civilizations –  How did citizens in ancient China get the items they needed for their family?  Or how does that system compare to the types of money we use in our class?  How was wealth distributed in Medieval Europe and how would that look in our class?
Language:  “Let’s come up with an agreement between loan giver and receiver that explains in detail the expectations for repayment.  Our language needs to be precise and clear so that there are no bad deals”. We created a rental agreement for the desks that included how the desk needed to be taken care of. We also wrote resumes and held job interviews for specific jobs that students wanted within the classroom.
Science:  Students have the ability to purchase STEM activities for the whole class, as well as science-y items such as gliders.  Using the idea of cost/profit when looking at issues surrounding industrial impact and resource management.
Math:  There are so many ways to connect a classroom economy to math such as calculating sums during a math talk (e.g.,  I have 3 of this bill, 4 of that, etc.). We tied into learning about decimals and made piles of different denominations, where each pile had to have the same total value. Then we looked at which fraction was represented by one bill from each pile. Having a student be the banker and collect/distribute pay as well as rent was a great way to have them practice early multiplying, number recognition, skip counting, and overall number sense.  We created division problems with money themes and that had a real world application to our classroom economy.  The list for math activities goes on and on.
How Things Ended:
By the end of the year, I had printed about 100K of classroom money, had the students paying rent, utilities, and grocery costs.  Many businesses had come and gone.  The kids had a better understanding of some pretty important ideas such as value, consumable goods, supply/demand, banking, responsible ownership, and enough other things that the effort I put in was 100% worth it.  I finished the year knowing  that I would definitely use the classroom money again, and with so many more ideas on how I could blend it into my classroom teaching.  The site I used to create my money is free and is called www.festisite.com/money.  Give it a go, and I hope you enjoy creating a classroom economy as much as I did.
Along with teaching financial literacy, you can read about the importance of social emotional learning in math here.

financial literacy using a classroom economyfinancial literacy using a classroom economy

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