Financial Literacy

Budget

Activity Sheets

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Lesson Description

In the first part of this comprehensive lesson, children are introduced to the concept of a budget. It starts by reviewing previous learnings about earning, spending, and saving money. The instructor then emphasizes the importance of a budget using a relatable story of two friends, highlighting how having a budget allows us to meet our needs and wants without running out of money.

In the second part, the lesson breaks down the concept of a budget into its basic components: income, expenses, and savings. Using a metaphorical approach, a budget is likened to a jar of cookies to make it easier for children to understand. The lesson further defines and describes the three components of a budget, demonstrating how they interact through the use of numerical examples for different months.

Next, children are encouraged to create their own budget using the "Budget Balancer" activity. The activity, set across three hypothetical months, provides them with a hands-on experience of managing income, distinguishing between needs and wants, and strategizing their expenses to meet a savings goal. The instructor also shares their own approach to the activity, providing guidance for children who may find the task daunting.

The fourth part of the lesson discusses good budgeting habits, which are key to managing money responsibly. These habits include tracking expenses regularly, avoiding impulse purchases, saving more than 20% of income, and regularly checking the budget. Each habit is discussed in detail to help children understand its importance and how it can be practiced.

The lesson concludes by summarizing the key learnings about the purpose and components of a budget, the fun activity, and the good budgeting habits. Overall, this lesson is designed to equip children with the basic knowledge and skills of budgeting, which is fundamental for their future financial success.