Dr. Patricia Page, who has her graduate degrees in Business Administration and Education, and a PhD specializing in Educational Technology, is an avid user of Budget Challenge. Dr. Page has recently shared her perspective on Budget Challenge and financial literacy with us. Read her bio here
Are there financial skills all students need to know and what is the best way to teach them?
Finances are dynamic. Our students / emerging adults need a systematic, replicable approach to evaluating financial decisions and the flood of fintech products that are being marketed to support and simplify money and wealth management. Researchers have consistently shown that affording students authentic, age-appropriate opportunities to apply productive money scripts and lessons supports positive long-term financial behaviors. Budget Challenge provides the learning platform that requires students to consider the interplay of spending and saving decisions when faced with real-life, situation-specific, planned and unplanned expenses that have an immediate and/or longer term financial impact.
Are there things that you feel today's students need to learn about money, that you didn't feel you needed to teach prior to starting Budget Challenge?
Students cannot relate to the need to plan for their future financial wellbeing or unexpected events. They, for the most part, live in the moment. Budget Challenge allows me to introduce the seemingly nebulous and distant concepts of insurance, long-term debt, and retirement saving and investing within this real-time learning platform that they are navigating now—not a year or more from now.
What has been your favorite part of Budget Challenge as a teacher?
Budget Challenge provides an engaging, evolving environment that allows students to experience the positive and negative consequences of their financial decisions. During the span of the simulation, I watch students transition from simply making discrete financial transactions—paying bills and updating a spreadsheet—to applying a strategy, e.g., adjusting 401(k) contribution levels based on assumptions they model in their budget and cash flow spreadsheet.
What is the biggest challenge as a teacher when using Budget Challenge?
For me, the biggest challenge is avoiding the temptation to dive too deep into a topic before the simulation launches. To curb my enthusiasm, I compiled a set of EdPuzzle videos that align with each of the vendor selections. The short videos and embedded questions, which I augment with classroom mini-lessons, give the students enough information to make initial, informed decisions.
What is the biggest challenge for students participating in Budget Challenge?
The biggest challenge for my students is making that transition from compiling a budget to then using the spreadsheet as a cash flow management and projection tool. At two points in the simulation, I have my students reconcile their online bank balance with their spreadsheet and provide me with an explanation for any difference (e.g., fees, pending checks, failed to record payment or transfer, change to 401k affected biweekly pay). This process, invariably, requires students who have not updated their spreadsheets to do so. It also has the added benefit of getting students more comfort navigating spreadsheets and reviewing formulas.
How have your students responded to the Budget Challenge?
As part of the post-simulation debriefing process I undertake with each class, students consistently indicate that they finished the Budget Challenge simulation feeling more confident, but cautious, in their ability to manage their money going forward. More validating are the testimonials from students and parents. They convey the content of conversations with family members, bankers, and investment advisors about fees, overdraft protection, and savings vehicles including Roth IRAs and 457 plans. The parents and students themselves comment on the reciprocal benefits of Budget Challenge. Both groups are more comfortable discussing household and personal expenses, expressing what they don’t understand about a financial product, conducting research, and asking questions.
Are there any tips you can give to new teachers using Budget Challenge?
Position your first venture in Budget Challenge as a sandbox environment where you and your students explore and experience the simulation together. Powerful learning and connections will happen when you and your students collectively read the material, ask questions out loud, and access the knowledge base and help center.
Make the 401(k) election last. If students have recorded all their projected fixed and variable expenses on their spreadsheet, they can now see how much net income / take-home pay they need to meet known expenses. It’s also impactful for students to see their budget spreadsheet balance show in the red, which gives them an initial appreciation for the need to have a budget or spending plan.