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Economis Mini-Lesson: Banking Basics (Grades 5-8)
 

Suggested Target Age: Grades 5-8

Topics Covered: checking and saving accounts, deposits and withdrawals, the benefits of having a bank account

Time Required: 45 minutes

Sources: Moneyopolis

What Will the Students Learn?

    • What savings and checking accounts are
    • What deposits and withdrawals are
    • The benefits of banks (safety for your money, free check cashing)
    • That check-cashing stores charge expensive fees to cash checks

    State Contents Standards Key
    Virginia: Civics and Economics: CE.10; Economics Education and Financial Literacy: Objectives 5, 6, 14
    Indiana: E.1.5, E.6.3
    Florida: Social Studies: SS.D.2.2
    California: Career Technical Education Model: B2.1, D10.5

    NOTE: The first half of this lesson does not require computers or Internet. However, the second half involves having students log into their Economis accounts online.

    Materials Needed:

    • An envelope that says, “This envelope contains receipts, pay stubs, and $345.86 in cash.”
    • Checks Received and Spending Transactions List
    • Definitions Worksheet
    • 2 Large cardboard signs; one labeled “Pay Day Advance Store” and the other labeled “Moneymakers Bank”
    • 2 fake paychecks (give one each to Student #3 and Student #4 in the role-play)

    Teacher preparation:

    1. You will be having four students participate in a role-play scenario. Select these students and ask them to come to the class just a few minutes early so you can review their roles with them. Figure out who students one and two are going to be. Give student #2 the envelope that says, “This envelope contains $345.86 in cash.” Tell them that after student #2 is told to take out his/her envelope, student #1must steal it and run back to his/her seat. (This will make more sense once you read the lesson).

    2. Go through the Customer/Clerk Dialogue below with student #3, and review the Customer/Teller Dialogue below with student #4.

    Lesson Plan:

    1. Tell the students that you are going to do a “Life Without Banks” role-play that will show the difficulties of saving money without banking. Tell them that during the role-play they should be thinking about the problems that a person would run into if he/she doesn’t keep money in the bank.


    2. Call your four role-play students up to the front of the room. Tell the class that student #1 just got a job where he/she is making a good amount of money, and gets to buy a lot of things he/she likes. You are going to summarize the earnings and spending of student #1 for the past few weeks by reading aloud Checks Received and Spending Transactions List.  Tell student #1 that he/she must figure out how much money he/she has after earning and spending it. Pull out the list and read it to student #1, making sure that you only take 2-3 seconds between each item, so that student #1 does not have sufficient time to make the necessary calculations. When you are finished reading the list, remind the class to think about what the problem was that student #1 faced.

    3. Tell the class that some people are very good at keeping track of their earning and spending. Have student #2 take out the envelope that says, “This envelope contains $345.86 in cash.” Say to the class, “This student has done a great job of keeping track of their earning and spending and saving their money and receipts in this envelope.” Suddenly now student #1 should steal the envelope from student #2 and run back to his/her seat. Remind the class to think about what the problem was that student #2 faced.

    4. Now tell the class that student #3 has just received a check, and since he/she doesn’t have a banking account, he/she must go to a check-cashing store. You will role-play the clerk at the check-cashing store. Hold up the cardboard sign labeled “Pay Day Advance Store” over your head, then go through the short script below:

      • Customer (Student #3, pulling out the paycheck and handing it to the clerk): Hi, I’d like to cash my paycheck.

      • Clerk (Teacher): OK, that will be $25 dollars.

      • Customer (Student #3): What?!! I have to PAY to cash my check?!! 

      • Clerk (Teacher): Yes! Of course, this is a check-cashing store. Do you think we serve you for free?

      • Customer (Student #3): But I’m supposed to GET money when I cash my check, not LOSE money!

      • Clerk (Teacher): Well, looks like you’re going to have to find yourself a bank.

    5. Following this short role-play, remind the class to think about what the problem was that student #3 faced.

    6. Now hand a paycheck to student #4. Student #4 should now say, “I love Fridays – that’s payday. I can’t wait to cash my paycheck!”
      Student #4 should now walk with the paycheck across the front of the classroom where you are standing, now holding the sign “Moneymakers Bank” over your head.

      • Teller (teacher): Hi! Welcome to Moneymakers Bank. What can I do for you?

      • Customer (Student #4): Hi. I’d like to cash my check.

      • Teller: Sure.

      • Customer: How much will that be?

      • Teller: Oh, that’s free when you have an account here. What is your account number?

      • Customer: That’s great! My account number is 2220044. Can you also tell me how much I have in the bank now?

      • Teller: Let’s see, including this check, you’ve now deposited $1,435.94 into your account, and your savings account has made $21.57 in interest, so you have a total balance of $1,463.51.

      • Customer: Thanks!

      • Teller: Anytime! Have a great day!

    7. Have the four students from the role-play take a bow and return to their seats. Now ask the class to reflect on what they saw. Ask the students what the problems were that the first three role-players ran into, and what some of the benefits are to having a bank account. As they answer, write their responses on the board. (Make sure that you eventually write the following on the board, even if the class doesn’t give the answers: banks keep your money safe; it is easier to keep track of your money, using banks is cheaper than using check-cashing stores, and you gain interest on your money.)

    8. Now pass out copies of Definitions Worksheet and go through each definition, asking students to read them aloud.

    9. Now bring the class into a computer lab. Have all the students log on to their Economis accounts. Have them click on Manage Finances.

    10. Ask one of the students which account is the “savings” account. Ask another student the definition of a savings account and what it is used for. (Here’s a good description of a savings account: You can add or withdraw money whenever you want.  Your money may earn some interest, and it’s always insured, so you can’t lose it.)

    11. Ask one of the students which account is the “checking” account. Ask another student what a checking account is used for. (Here’s a good definition of a checking account: Your money might not earn interest, but you can spend it without having to carry around a lot of cash.)

    12. Ask the students which of the accounts you can “deposit” money into. Ask the students which of the accounts you can make a “withdrawal” from. (They can make a deposit into their savings account by transferring funds from the checking account. They can withdraw money from their savings account by transferring it to their checking account.)

    13. Ask the students which of the accounts earns interest on your money. (savings)

    14. If the students want, they could now transfer some funds from their checking accounts to their savings accounts so that they can begin earning interest. Just remind them that when they use their Economis debit card to purchase items from your store (Online shopping or a Point of Sale store), their debit card is linked ONLY to their checking account. So, if they have 10 units of currency in their checking account and 50 units in their savings account and they go to purchase something that costs 25 units, the sale will be refused for insufficient funds, despite the fact that they have the 50 units of currency in their savings account. If this happens to a student when shopping, he/she simply needs to log into their Economis account and transfer funds back from savings into checking.

    Optional Closing Activity:

    1. You as the instructor could go through the Economis Flash Cards (for copies of the flash cards, go to www.elevateurbanyouth.org and click on Resources, and then select Handouts, and then select Flash Cards) and pick out the ones relevant to the concepts taught in this lesson, then show the cards to the students. To encourage students to use the Flash Cards to practice, you might offer incentives – such as 5 units of your currency for a student who can correctly answer 10 questions from the Flash Cards.