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Severn Students Learn Smart Finance
In Tony Wagner’s recent book Most Likely to Succeed, the author stresses the importance of teaching skills like financial literacy to prepare students for the future. But it can be a challenge for students who have varying levels of experience with money management at home to see the connection between personal finance decisions and the larger financial world. In both our Lower and Upper Schools, we give our students the tools to make smart financial decisions for themselves with an understanding of how that decision making plays into the global economy.
5th Graders Invest with the Stock Market Game
During the second half of the year, our 5th graders start to learn advanced financial concepts and vocabulary. They explore scarcity, benefits, costs, capitalism, budgets, barter transactions and stocks. In the past, using Gary Paulsen’s book Lawn Boy as inspiration, they’ve created basic nonprofit type businesses to explore these concepts in simulated real-life scenarios. This year they are trying their hand at virtual investing with the Stock Market Game.
What is the Stock Market Game?
The Stock Market Game is a national, online educational game where students virtually “invest” in real stocks, in real time. The game teaches fundamentals of personal finance and investing in a fun, collaborative environment.
How Does the Game Work?
Before starting the game, fifth grade teachers Ms. Lauren Kitchin and Ms. Gail Lapinksi help students build knowledge about the basics of the stock market. They also establish each student’s level of prior knowledge. A few students currently have stocks given as gifts and have some idea of how the market works. For others, this is their first experience with investing.
Working in groups of 3-5 our students make a list of companies they might like to invest in. They learn how to find the stock ticker symbol for each company and evaluate values in real time using Google Finance. With that information, each group creates an electronic portfolio with $100,000 virtual dollars and follows their stocks over several weeks, making predictions and assessing progress along the way.
This process helps students see the fundamental basics of the stock market. They learn how to assess risk vs. reward, make choices, and then evaluate the outcome of those choices. They compare daily changes to more long term changes and discuss how time affects the value of money.
Financial Literacy and The Real World
Offered as an Upper School math elective, Mr. Julien Meyer’s Financial Algebra class gives Severn seniors a framework to make important financial decisions throughout their lives. They explore concepts like the time value of money, present vs. future value, and trade offs between risk and reward. From credit and loans to saving and investing, this class gives them a starting point from which to grow in their lives as financial adults.
Practical Math: Career in Finance
Mr. Meyer regularly invites speakers from the business world to talk to his students. Particularly for seniors who are considering college majors and career choices, these speakers serve as a source of information and inspiration. They give students a lens into the working lives of financial professionals.
Most recently, the class welcomed executive and former head of research at T. Rowe Price, Ms. Anna Dopkin. She began with an introduction to investing with an overview of the different types of careers in a financial institution. She also took students step-by-step through a simple investment analysis using school uniforms as an example. She asked them to make assumptions and then helped them test those assumptions using variables you might find in the real world. It was an eye opening exercise in the thoughtful practicality needed when making financial choices.
Ms. Dopkin concluded with strategies for making smart investments including how to choose a company/stock, lessons in tech investing, investing styles and more. Ms. Dopkin not only imparted useful knowledge about making personal finance choices, but also gave our students a glimpse into what a career in the financial sector might look like for them.
