Bridging Learning to Behavior

Brian PagePersonal Twitter: @FinEdChat

Classroom Twitter: @TeenDollars

Nuts and Bolts of Personal FinanceTools we use to manage our personal finances

Example: Banking servicesConcepts applicable to financial scenarios

Example: Power of compound interest

Each are often found in standardsCouncil for Economic Education Jump$tartState Standards

“Nuts and Bolts” don’t turn themselves!

To bridge learning to behavior…

+ Tools + Concepts + Behavior Strategies + Relevant teen topics

Prepared

Build in Behavior StrategiesDon’t eat the marshmallow!

http://www.ted.com/talks/joachim_de_posada_says_don_t_eat_the_marshmallow_yet

If a student is impulsive, then what? It’s our job to introduce them to strategies to

overcome impulsive behavior

Nudges – America Saves / Budget Challenge Project

Control group ~ 500 students in a financial education classExperimental group ~ 100 student in a financial education

class plus nudging texts encouraging: Set a savings goal Open a savings account at a bank or credit union Contribute regularly

Ideally with a direct deposit

Original study 4 messages per week for two months

National study 3-4 messages per week for six weeks

Nudging ResultsDo you have a particular savings goal?Experimental* –

Pre: 79% of total students said yesPost: 94% of total students said yes

Control – Pre: 64% of total students said yes.Post: 69% of total students said yes

*My students had already set savings goals prior to this survey

Nudging Results ContinuedDo you have a savings account at a bank or

credit union?Experimental –

Total students said yes: 20% growth

Control – Total students said yes: >1% growth

Nudging Results ContinuedDo you make a deposit to your savings account at

least monthly?Experimental –

Total students said yes: 50% growth

Control – Total students said yes: 11% growth

Tools to nudge your studentsAmericaSaves.org

Strictly savingsRemind101

Craft your own messages

Making choices “sticky”Choices are “sticky” when they’re easiest

In other words – “opt outs”Saving as the default

Direct deposit (split deposits) into savings, checking, (and eventually retirement products) Start small, otherwise savings accounts turn into a

second checking account

Spending as the default Auto payments can be beneficial but…

Verizon “Edge Program” as an example

Decision fatigueWhat is decision fatigue?Overcoming decision fatigue

Before making a big decision… Sleep on it Check your budget Talk to your spouse Check your balance on your phone* Use comparison shopping apps like “Red Laser”

Choice architecture What is choice architecture?

The way decisions can be influenced by how they’re presented.

ExamplesBuffet “Opt-in” – Verizon Edge

“AA” for personal financePeer grouping

Partner/group with someone who has strong will power toward the stated goal

Partner/group with someone with like goalsFun ways to interact

Encouraging texts Saving contestsConsequences, your friend takes a favorite item if

you impulsively spend

Study Finding: Teens are stressed about moneyThe “Why’s” are important, the “Why’s” are examples of how we can make lessons relevant

How to make lessons relevant…

Plan your lessons and design your tests looking at the financial world through the eyes of a teenager.

Study: Teens are stressed about moneyThe cost of collegeTeen households are becoming poorer

Median income is down nearly 10% since 1995

Taxes are complicatedOnly 3 of every 100 teens have filled out an income

tax forms.Teens use their own money on purchases but lack

fundamental money management skills.

Addresses Stresses – The Cost of CollegeRelevant lessons aligning concepts from national

standardsComparison shop colleges

Sticker price / Pricing strategies; Coupons (School scholarships, grants); different types of degrees; FAFSA

Consumer Financial Protection Bureau “Paying for College”Principles of borrowing (student loans)

Interest; the maximum to borrow; Does it improve your future self

Return on the investment (college) Importance of good grades, networking, employable skills

Addressing Stresses: Eroding IncomesRelevant lessons aligning concepts from national

standardsStart them down the path of saving while they’re

young and it’s easier! America Saves Pledge and Texting Nudges Council for Economic Education Compound Interest

Calculator

Addressing Stresses: Taxes Relevant lessons aligning concepts from national

standardsMost students will qualify for tax refunds!Have them complete a W2, and a 1040EZ with a

simulated W4. Allow them to use their own W4 and bring in their

own 1040EZ during the exercise. IRS Understanding Taxes Free File

Addressing Stresses: Money Management Skills

Goal SettingHave them establish their own short term S.M.A.R.T. savings

goals. Common student goals: Saving for prom, a car, a phone, new

shoes (Jordan’s), spring break, college Reinforce the rewarding feeling of reaching a savings goal.

Saving isn’t just for emergencies, it’s for future spending too

They should experience early on the rewards of savingLong term goal setting strategy

Begin with student visualizing seeing himself/herself in the mirror at an older age.

Walk them through a “day in their lives”

Addressing Stresses: Money Management Skills

Budgeting Priorities, values, and goals Let’s call him Tim

Spousal/roommate activity

Address the contradiction of behavior and knowledge Budgeting simulation:

Students saved last Test questions: Students knew

to save first and spend second Why? Scared that wouldn’t

have enough. Great teachable moment!

Addressing Stresses: Money Management Skills

Choosing a Financial Institution Shop Around – It’s like dating!

You never marry one, you spend your life dating.

Minimize, or if you can… avoid fees Minimum balance requirements Overdraft fees

Establish a savings account, a checking account, and a direct deposit into both

Take advantage of mobile banking options Mobile banking; text alerts

Overdraft protection – it’s like insurance you typically only have to pay for if you make a mistake

Addressing Stresses: Money Management Skills

Using Mobile Phones as Money Management ToolsMobile phones for financial management and financial

decision makingMobile banking

Text alerts Checking balances before big decisions

Comparison shopping apps like Red Laser

Teach them to use them safelyDon’t use public Wi-FiHow to set up a safe password

Il2g2c!

Addressing Stresses: Money Management Skills

Comparison ShoppingComparison shop for an automobileTrue Cost to Own Calculator

Cost of the car Depreciation Gas Comparison shop insurance

What’s the opportunity cost of owning a car? Less freedom? Tied up future free time Tied up future income for college or an apartment

Bridging Learning to Behavior Further examples

Credit ReportsHave students check their credit report:

annualcreditreport.comHave students set annual phone reminders to check

their credit report at annualcreditreport.com

Follow key organizations like the FTC on social media

Comparison shop automobile insurance plans

Special Education StudentsThree universally effective strategies…Peer to peer learning

Consider cognitive ability, relationships, and behavior

Game-based learningOnGuardOnline.gov

Performance based learningComplete a 1040EZ, rather than question about a

1040EZ

Experiences matter mostField Trip Examples

“A Walk Down Wrong Street”Bank or Credit UnionAuto dealershipsGrocery store or mall

Test QuestionsDesign test questions to align with national

standardsInclude ways to assess students understanding of

putting learning into actionCritical thinking; application of conceptsDesign test questions through a teenagers eyes

Old Test QuestionSelect the term describing the process of setting income aside for future spending. a. Credit Cardb. Spendingc. Savingd. Investing

New Test QuestionSelect the best savings strategy for Michael, a teenager with a job and access to a direct deposita. Direct deposit income into a checking accountb. Direct deposit income into a savings accountc. Elect to receive checks rather than use a direct deposit serviced. Direct deposit a portion of income into a checking and a portion of income into savings

Old Test QuestionSelect the term defining the purchasing goods or services without considering needs, goals, or consequences.a. Savingb. Investingc. Impulse Buyingd. Delayed Gratification

New Test QuestionIf making an impulsive choice, which financial decision to overspend would be more costly over time?a. Flexible expense, such as overspending on a purseb. Fixed expense, such as overspending on a carc. Flexible expense, such as overspending on promd. Flexible expense, such as overspending on dinner

Classroom Twitter @TeenDollarsStated Purpose: Help teens with the financial choices they

have to make nowHidden Purpose: Nudges, motivationThe 21st century classroom wall?How I manage it.

I only follow organizations and leaders dedicated to my stated mission

I do not follow students; but have hosted “student chats” “Financial tweets” are relevant to their current choices I insert humor, motivational posters, and student successes Tweets are timely

Example organizations I follow

#StudentChat

Example “Financial Tweet”

Example “Financial Tweet”

Example “Financial Tweet”

Example “Financial Tweet”

Example “Financial Tweet”

Example “Financial Tweet”

Example “Inserting Humor”

Example “Inserting Humor”

Example “Inserting Humor”

Teachers are difference makers!

ResourcesHundreds of catalogued Personal Finance

Resources http://www.livebinders.com/play/play_or_edit?id=

384905

Catalogued resources specifically for soon to be or recent high school graduateshttp://www.livebinders.com/play/play?id=363714