Monthly Archives: August 2015

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Investing Game: Think You Can Beat the Market?

Great simulation (on Quartz) for students to see the futility of trying to time the market, which is the belief that you can make good decisions about when to get out of the market (if you think it is overvalued) and to get back in (when you think it is undervalued). I created this two-page mini-activity to guide your students through the game.

This simulation uses prices from the S&P500 for a ten year period (this ten year period changes every time you play the game too!) which unfold on the line graph at the rate of about one year of data every 7-10 seconds.  Here is a screenshot after seven years elapsed (note the talking head on the left which provides tempting advice as the game unfolds).

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Here is a sample output after the game is completed (total time per game play is about one minute):

By |August 31st, 2015|Activities, Activity, Behavioral Finance, Index Funds, Investing, Stocks|

Audio Resource: What Role Does Fear Play In Investing?

From Marketplace (5 minute interview):

Here are the questions covered in this interview with a psychology professor:

  • What happens in brain when fear hits (e.g., when stock market drops 1,000 points as it did last week)?
  • How do different people process the fear stimuli?
  • Is our fear response innate or can we teach people to develop a higher tolerance for pain?
  • How does fear impact our decision-making?

You might ask students where they fit on the “fight or flight response” continuum and how they might react to a 1,000 drop in the stock market.

By |August 31st, 2015|Audio Resource, Behavioral Finance, Investing|

What’s New In Schools?

With schools opening across the country, here’s the latest news on what’s happening with financial literacy:

  • Gooding, a rock and roll band, is touring US high schools to spread their message of financial literacy (Parade):

The band, which also includes Jesse Rich on drums and Billy Driver on bass, created Funding the Future, a nonprofit that delivers a message of financial literacy through an engaging music-focused presentation. They’ve been putting on their shows at high schools across the country.

  • On The Money Magazine started to provide financial literacy education to high school students (St. Louis Public Radio):

Enter “On the Money Magazine Saint Louis,” a magazine for young adults dually focused on spreading financial literacy and providing its writers, artists, and photographers with professional publication experience. Shields is a journalist for “On the Money” and part of its core team of permanent members; she, illustrator Najee Person, and creative director Andrew Johnson joined “St. Louis on the Air” to talk about the program’s mission and upcoming growth.

  • Indiana mulling a requirement for high school students to take personal finance course to graduate (Indiana Daily Student):

With the changes, high school students will have three diploma options: the

By |August 31st, 2015|Financial Literacy, Personal Finance, Schools In News|

Which Account Would You Choose?

Thanks to my colleague, Jessica, for letting me know about this phenomenon of a 10 year CD with an interest rate below a regular savings account.  So, the question for your students is this:

Suppose you had $500 that you didn’t think you would need for a long time.  Would you invest in a 10-year CD earning 0.90% or a regular savings account earning 0.75% interest?

Some good points for a discussion:

  • Locking into a 10-year CD hurts your option value to invest in a CD with a higher interest rate which may appear as interest rates rise.
  • Federal Reserve has announced that they will be raising interest rates sometime in 2015 for first time in over six years.
  • You would only make the decision to invest in the CD if you believed that interest rates were going to fall so there was an advantage to locking in a higher interest rate NOW.  Looking at this historical chart of T-bill rates (a proxy for interest rates on savings accounts) suggests that interest rates have no place to go but up.
  • “Bricks and mortar” banks traditionally offer lower interest rates than online banks.  Why?  A very different cost structure.

By |August 31st, 2015|Current Events, Question of the Day, Savings|

New Product: Give the Gift of Stock…

I just came across this start-up, SparkGift, which allows you to give gifts of stock and index funds to friends and family.  Here  is a summary of their offering from their website:

Teach someone about investing

Many people don’t have a savings or investment account. Traditional financial firms can make investing complicated. Spark makes investing simple so that young investors can learn the value of investing early and experienced investors can receive gifts that grow their portfolio. A gift can empower someone’s financial future.

Send a stock gift certificate in under a minute

There’s no need to fill out long forms, sign papers, or mail checks. You choose a stock or fund and pay. We create a gift certificate with your choice of stock and fund and deliver it to the recipient. It only takes a minute to give an investment that can last a lifetime.

Start gifting stock for as low as $20

With SparkGift you can give fractional shares of stocks and index funds. SparkGift charges a flat $2.95 gifting service fee for gifts up to $100, and a 4% fee for gifts above $100. All it takes is a Spark.

By |August 31st, 2015|Generosity, Investing, Mutual Funds, New Products, Stocks|

August Survey Results: Hot Topics in Personal Finance

Hot TopicIf you want to know the hot topics in personal finance classrooms this 2015-2016 school year, who better to ask than a bunch of high school teachers, preparing their curriculum maps for the upcoming year? We asked, and you answered in our August Flash Survey. See the results below.

By |August 28th, 2015|Current Events, Personal Finance, Survey Results|

September Flash Survey: Is NGPF meeting your needs?

Screen Shot 2015-08-28 at 2.18.01 PMThis summer we’ve focused on creating a lot of fabulous new content for you to use this school year. Now that those projects are wrapping up, we want to know where to focus next. Help us by taking this brief Flash Survey to tell us whether NGPF is meeting your needs and how we could be even better. Don’t forget — there’s always a chance of being our $50 gift card winner!

By |August 28th, 2015|Flash Surveys, Uncategorized|

Audio Resource: Want To Bring A Bank To Your School?

From Iowa Public Radio (45 minute podcast):

Financial literacy has been required as a part of the 21st-Century Skills portion of the Iowa Core for years. But specifics on enforcing the standard are fuzzy, so personal finance and economics classes vary wildly district to district.

Bob Mantell is the director of the T.S. Institute, an organization dedicated to financial literacy for K-12 students, that’s based in Treynor, a southwestern Iowa city of about 1,000 people. His organization puts banks in schools so that kids can get first-hand experience with money. Some kids serve as tellers, others deposit money in a savings account.

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Check out the NGPF Activity on Online Banking

By |August 28th, 2015|Activity, Audio Resource, Savings|