Presentation on theme: "Module 7: Managing your money – saving. Module objectives Provide an opportunity to look at the learner outcomes in the ‘Manage money’ element of the."— Presentation transcript:
Module 7: Managing your money – saving
Module objectives Provide an opportunity to look at the learner outcomes in the ‘Manage money’ element of the numeracy component of the National Literacy and Numeracy Framework (LNF) to identify where teaching learners about the ‘basic principles of saving’ exists in the curriculum in Wales. Highlight resources and activities that can be used in Key Stages 2 to 3 to develop learners’ numeracy skills in the context of saving and investing money. Provide a list of useful websites for Key Stages 2–5 to have access to classroom ideas for saving and investing money. Note: Differentiation, extension ideas and effective questioning will often be suggested in the notes within the PowerPoint for teachers/trainers to use as required.
Learner aims This module introduces the basic principles involved in the process of ‘saving money’. Learners will be able to: understand that there are different ways of saving appreciate the basic principles of saving money describe some short- and long-term benefits to saving identify the main features of a savings account and the steps involved in opening an account understand that earning interest can help savings grow calculate and compare simple and compound interest appreciate the risks involved in different ways of saving and investing. The module is designed for use across key stages – not all outcomes will apply to all learners.
An opportunity to look at the learner outcomes in the ‘Manage money’ element of the numeracy component of the LNF to identify where ‘understanding the principles of saving money’ exists in the curriculum in Wales. Learner outcomes relating to saving are marked in bold in the table.
Manage money Learners are able to: Year 3use different combinations of money to pay for items up to £2 and calculate the change order and compare items up to £10 record money spent and saved. Year 4use money to pay for items up to £10 and calculate the change order and compare items up to £100 add and subtract totals less than £10 using correct notation, e.g. £6.85 – £2.76 manage money, compare costs from different retailers and determine what can be bought within a given budget. Year 5order and compare the cost of items up to £1 000 add and subtract totals less than £100 using correct notation, e.g. £ £33.45 plan and track money and savings by keeping accurate records realise that budgeting is important. Year 6use the terms profit and loss in buying and selling activities and make calculations for this understand the advantages and disadvantages of using bank accounts make comparisons between prices and understand which is best value for money.
Manage moneyLearners are able to: Year 7use profit and loss in buying and selling calculations understand the advantages and disadvantages of using bank accounts, including bank cards make informed decisions relating to discounts and special offers. Year 8carry out calculations relating to VAT, saving and borrowing appreciate the basic principles of budgeting, saving (including understanding compound interest) and borrowing. Year 9calculate using foreign money and exchange rates understand the risks involved in different ways of saving and investing describe why insurance is important and understand the impact of not being insured. Extensionuse and understand efficient methods of calculating compound interest understand and demonstrate the real-life process of foreign exchange understand and calculate income tax.
The Personal and social education framework for 7 to 19-year-olds in Wales also highlights opportunities for learners to become competent at managing their finances, planning for the future and knowing where and how to access financial advice. This module aims to address this in the context of understanding the basic principles of saving and investing money.
Personal and social education framework for 7 to 19-year-olds in Wales Key Stage 2 learning outcomes Range: Preparing for lifelong learning Learners should be given opportunities to understand: that money is earned through work and can buy goods and services the importance of looking after their money and the benefits of regular saving. Personal and social education framework for 7 to 19-year-olds in Wales Key Stage 3 learning outcomes Range: Preparing for lifelong learning Learners should be given opportunities to understand: the economic and ethical consequences of personal financial decision-making as a consumer, e.g. Fairtrade how to become competent at managing personal finances and recognise that saving provides financial independence. Personal and social education framework for 7 to 19-year-olds in Wales Key Stage 4 learning outcomes Range: Preparing for lifelong learning Learners should be given opportunities to understand: their rights as consumers and their responsibilities in terms of managing a budget the importance of planning for their financial futures and how to access financial advice.
The big question What is saving?
Starter activity: Places we use to save our money Can you name some places where you can save your money?
Places we use to save our money Building society In a jar Post Office Credit union Money box Purse or wallet Bank Under the bed In a safe
Starter activity: Advantages to saving money Why do people save money? Why is saving a good alternative to borrowing money?
Reasons to save money School trip For the latest ‘must have’, e.g. smart phone Driving lessons University Purchase a household appliance Buy expensive clothes Deposit for a house Supermarket saving stamps Wedding Family holiday Buy first car/scooter To buy a gift for a special occasion
Saving activities Key stageActivityWhat’s it about? Suitable for lower Key Stage 2 1. Saving upConsiders spending and saving. Suitable for upper Key Stage 2 2. Once upon a timeA fictitious but realistic advertisement for a children’s savings account. Suitable for Key Stage 3 3. Did versus didn’tExplores scenarios about the spending and saving of six young people. Suitable for Key Stage 3 4. Paying it inInvestigates the key features of a savings account. Suitable for upper Key Stage 3 5. Savings and investments matching cards games Promotes vocabulary which allows learners to understand different types of saving and investing.
Activity 1 Resource: Manage money activity sheet: Saving up Manage money activity sheet: Saving up Activity: The activity is aimed at younger learners and consolidates some of the previous starter/discussion ideas. It encourages learners to think about what they might spend money on, save up for and where they can save their money.
Activity 2 Resources: Manage money activity sheet: Once upon a time Manage money activity sheet: Once upon a time Activity: Learners read a fictitious but realistic advertisement for a children’s savings account and answer the corresponding questions.
Activity 3 Resource: Welsh Government Personal Finance Toolkit Download the resource at tions/resources/?skip=1&lang=en tions/resources/?skip=1&lang=en Activity: Did vs. didn’t Topic 2, ‘Saving for the future’ (pages 22–27), should be used with the accompanying Resource sheet 1 entitled ‘Did vs. didn’t’ (pages 17–19).
Activity 3 Did vs. didn’t The resource provides learners with six scenarios about a group of young people spending and saving. It is suitable for Key Stages 3 and 4. The toolkit provides detailed lesson ideas of how to deliver the activity with learners.
Savings accounts: What to look out for There are many different accounts with many different features for young people. Working in groups, learners can come up with information they need to gather about opening a savings account. Access? Minimum deposits? Interest rate? Age?
Savings accounts: What to look out for FeaturesWhat some banks may offer AgeSavings accounts with a minimum age. Different saving accounts available for different age groups. AccessUnlimited instant access to funds (by young person or adult). Occasional access to funds. No access to funds until young person is 18, for example. A notice period may be required, such as 7, 30, 60 or 90 days. Interest rateIntroductory interest rate. Fixed/variable interest rate for a limited amount of time. DepositsMinimum deposit required to open the account. Certain amount to be paid in regularly. Unlimited deposits. Operate account Online. Branch. Use of cash card or debit card.
Activity 4 Resource: Welsh Government Personal Finance Toolkit Download the resource at cations/resources/?skip=1&lang=en cations/resources/?skip=1&lang=en Activity: Paying it in Topic 2, ‘Saving for the future’ (pages 22–27), should be used with the accompanying Resource sheet 3 entitled ‘Customer cards’ (pages 21–22).
Activity 4 Paying it in In this activity, learners discuss or role play opening a savings account and identifying the key features. The toolkit provides detailed lesson ideas of how to deliver the activity. Learners will need account leaflets or printed online information for a range of savings accounts (or internet access to investigate for themselves) from several banks or other providers, such as building societies or credit unions. Alternatively to carry out a savings comparison go to https://compare.moneyadviceservice.org.uk/savings https://compare.moneyadviceservice.org.uk/savings
Discussion activity: What do you know about the following types of savings? Some types of savings products for young people Junior Cash ISA Child Trust Fund For more information on Child Trust Fund and Junior Cash ISAs visit and For further information on children’s bonds Children’s Bonds
Save or invest? Do you know the difference? SavingInvesting Putting money aside to make a lump sum, for a ‘rainy day’, or a short-term goal such as the purchase an expensive item. Using money by buying things that might increase in value, like property, stocks or shares in a fund.
Activity 5 One of the Year 9 learner outcomes of the ‘Manage money’ element of the numeracy component of the LNF is ‘understand the risks involved in different ways of saving and investing’. Activity 5 shares some ideas you may choose to support this. Starter activities: Savings and investments matching cards games Print off Resource 1 and Resource 2 available within this module.Resource 1Resource 2
Risk and return RiskReturn Risk is another name for chance and uncertainty Examples of types of risk: an agreed interest rate may not be a good value in the future an investment may fall in value. Return is the amount of money you get back on the investment you have made. A higher return often comes with riskier investments. Remember: ‘if it sounds too good to be true it probably is’.
Cerys £400 decreased by 5% Rhys £400 increased by 15% Risk and return Cerys and Rhys each decide to invest £400. From the information below who received the best return on their money? After one year: Calculate the difference between the amount of money each person has at the end of the year. This type of question allows learners to see that money is not always gained when invested.
Risk and return Can you think of other ways to invest? Can you describe an advantage and disadvantage of each of the scenarios above? Mr Jones invests his money by buying houses that are cheap and selling them again for more than they cost him to purchase and the cost of the improvements. Mr Evans invests his money by buying gold and then selling it when the price goes up. Discussion activity:
Risk and return One of the Year 9 learner outcomes of the ‘Manage money element of the numeracy component of the LNF is ‘understand the risks involved in different ways of saving and investing’. One opportunity to support the delivery of this can be found at the Risks and Rewards website that can be accessed at https://hwb.wales.gov.uk/cms/hwbcontent/_layouts/NGFLSolution/MaterialDescri ption.aspx?LearningMaterialId=50874&lang=en https://hwb.wales.gov.uk/cms/hwbcontent/_layouts/NGFLSolution/MaterialDescri ption.aspx?LearningMaterialId=50874&lang=en The resource covers a range of material, from looking at the role of banks to different kinds of investments. The material is provided in a variety of forms such as cartoons, games, video, audio exercises and written text. Teachers of mathematics, PSE, history, business studies and economics from Key Stage 2 to post-16 may find this resource useful.
The ‘Manage money’ element of the numeracy component of the LNF includes the following learning outcomes. Year 8: Carry out calculations relating to [VAT,] saving [and borrowing]. Appreciate the basic principles of [budgeting,] saving (including understanding compound interest) and borrowing. Extension: Use and understand efficient methods of calculating compound interest. Questions based on these learner outcomes are likely to be done in mathematics lessons. The next few slides introduce the definition of simple and compound interest, calculations, and two interactive online tools that learners can use to help them calculate compound interest.
Simple and compound interest Starter activity: Fill in the missing words. In a savings account the amount of money earned is called …………. The original amount of money deposited is the ………… Interest that is earned only on the principal is called ……….…… In a savings account, …………..is when the bank pays interest on both the principal amount and the interest already earned. principal simple interest interest compound interest
Simple and compound interest Answers In a savings account the amount of money earned is called. The original amount of money deposited is the.Interest that is earned only on the principal is called. In a savings account, is when the bank pays interest on both the principal amount and the interest already earned. principal simple interest compound interest interest
An introduction to calculating simple interest Sophie pays £300 into a savings account, and leaves it there for 4 years to watch it grow. The bank offers a rate of 5% simple interest per annum. (This means the bank will pay Sophie 5% of the money she has invested.) Questions: 1. How much interest did Sophie gain? 2. How much money does Sophie have in her savings account at the end of the 4 years?
An introduction to calculating simple interest 1. How much interest did Sophie gain? 10% of £300 = £30 5% = £15 Sophie gets £15 per year, so in 4 years 4 x 15 = £60 Sophie gained £60 interest 2. How much money does Sophie have in her savings account at the end of the 4 years? Total amount = principal + interest = £400 + £60 = £460
Mathematics example Nia has £600 to invest in a savings account. She intends to leave the money in the account for 2 years, without adding more or withdrawing any. She chooses between these accounts. 2 year bond: Pays 4% simple interest each year Savings account: 3% interest paid each year and added to the savings amount Simple interest Compound interest
2 year bond: Pays 4% simple interest each year Savings account: 4% interest paid each year and added to the savings amount Solution 400 x 0.04 = £16 In 2 years: £16 x 2 = £32 interest earned Solution 1 st year: £400 x 0.04 = £16 2 nd year: £416 x 0.04 = £16.64 interest earned = £32.64 Nia should invest her money in the savings account because it earns £0.64 more interest.
Interactive tools Learners could use an interactive online savings calculator to investigate the effect of compound interest. Two examples of an online tool that can be used are shown on the next few slides.
Learners can visit nts/VTC/ngfl/maths/r_davies/compound_calc/Compound%20I nterest%20Calc.htm The bilingual interactive activity allows learners to change four variables: initial value (principal amount) annual investment (yearly payments) period (length of time in years) annual increase (Interest rate). Learners can use the interactive tool to compare the effect that changing the variables has on the total amount of money in the savings account. (Note: this final amount is rounded to nearest one pound.)
Learners can visit tools/GeneralInterestCalculator.htm. tools/GeneralInterestCalculator.htm The interactive activity allows learners to change four variables: lump sum (principal amount) interest rate savings period (length of time in months) monthly payments. This interactive tool allows learners to be presented with the same methodology as the previous online tool but using different vocabulary. It allows using decimal values as interest rates and the savings period is presented in months.
Calculating simple and compound interest Extension activity: Use the interactive tools (or an effective calculator method to calculate compound interest) to compare how the growth in a savings account with compound interest is different from the growth in an account with simple interest. Encourage learners to present their workings in tables and a suitable graph. Allow them to decide the principal amount, annual investment (can be zero if no money is to be added to the account) and interest rate. Learners can compare how the two types of savings grew over five years.
This document is designed to assist teachers to recognise and promote higher-order mathematical skills within Key Stage 3 and through to Key Stage 4. It provides examples of learners’ work accompanied by commentary that identifies the characteristics of higher-order mathematical skills. Pages 49–52 demonstrate an example of learners’ work comparing compound and simple interest.
The Money Charity The Money Charity (formerly Credit Action) is a UK money education charity supporting young people to manage their money. For further information visit The website also presents modules of work for learners from Key Stage 3 upwards specifically to help secondary school educators teach their learners about financial education. To view the materials visit colleges/ colleges/
Adding up to a lifetime This is a free online resource which follows four characters and how they deal with financial situations. It is suitable for Key Stage 3 to Key Stage 5. The package is approximately 25 hours of learning activities which learners can complete online. It is presented as five modules: Life as a student (aged 14 upwards) Working life Relationships New life Active retirement. A whole range of managing money topics are included. Module 1 has a section on savings. Each module has an audio tutorial which can be listened to in English or Welsh.
Websites and resources Budgeting tools and advice for young people. Ideas, activities and resources for young people about saving and investing. A free interactive programme giving learners the skills to manage their money. Finance Skills: games, factsheets* and worksheets* for learners aged 4 to 18+ (printable resources and online games).* Welsh versions available. pfeg (Personal Finance Education Group) an independent charity providing a wealth of resources to support financial education in schools. See examples such as ‘My Money Mathematics Resources’, ‘Money Works: It’s your business’ and ‘Learning about Money in the Primary Classroom’ which are relevant for this module on saving and investing.
Websites and resources Free online advice and guidance on all money topics. Free booklets available: see the one relevant for this module entitled ‘Saving and investing’. and For more information on saving products. The site covers a range of material, from looking at the role of banks to different kinds of investments suitable for learners in Key Stages 2 to 5. Online interactive programme for learners Key Stage 3 to post-16. Interactive online calculator tool to investigate the effects of compound interest. /r_davies/compound_calc/Compound%20Interest%20Calc.htm Bilingual interactive online tool to calculate the effect of compound interest.www.hwb.wales.gov.uk/cms/hwbcontent/Shared%20Documents/VTC/ngfl/maths /r_davies/compound_calc/Compound%20Interest%20Calc.htm