Big Idea:

Financial Literacy

Expectations:

F1.4 explain the concept of interest rates, and identify types of interest rates and fees associated with different accounts and loans offered by various banks and other financial institutions

F1.5 describe trading, lending, borrowing and donating as different ways to distribute financial and other resources among individuals and organizations

teacher background

Pre-Lesson Survey (Parent Letter/Google Form):

1. What do you do with money you get/earn? Do you save some of it?

2. Do you have a bank account?

3. If so, what type of account do you have? Savings account, chequing, other?

4. Do your parents/guardians have a Registered Education Saving Plan (RESP) for you or your siblings?

5. What do you think trading money means? (Your money is used to invest in businesses. As the business makes money they share the profit with you. This is used when you want to save money for longer periods of time.)

6. What does lending money mean? (Banks use your money to lend it to others)

7. What does borrowing money mean? (Banks will loan individuals money and charge interest until it is paid off.)

8. What does donating money mean? (Individuals or organizations give money to not-for profit organizations so they can provide services and goods to communities.)

Divide the class into groups of four.

Tell the class that every group member will be assuming the role of a family member (two parents, two siblings) and that this family has just inherited $6,000.

Ask the class to suggest three things the family can do with the money: Spend, Save, or Give.

Ask the class how long they think the family will have this money.

Tell the class that many people run through all their inheritance money in less than 2 years.

Each group member will be given a different perspective of what they think should be done with the inheritance.

Hand out the scenarios, paper and pencils, and allow time to create and practice their dialogue. They need to convince each other that their idea on how to spend the money is the best.

Independent Work

BLM 1.3

Inheritance Money: What would you do?

What would you do with the $6000 of inheritance now that you know about these types of accounts and investments and thinking of your current family situation?

How much would you save? How would you save it (savings account, GIC, etc.)?

How much would you give? Who would you give it to?

How much would you spend? What would you spend it on?

After they present their arguments and do their individual work, you will bring out the important points related to the learning goals.

Focus: Cost Benefit Analysis

What are the advantages and disadvantages of putting the money into savings accounts, RESPs, TFSAs, GIC, CSBs and what are the benefits of donating?

Inheritance Money: What would you do?

Continue to Lesson 2.