Teaching personal finance to our teens doesn't have to be an overwhelming or difficult prospect. As a family that has been learning a lot about budgeting and paying off debt over the past 3–5 years, I can honestly admit that sometimes it DOES feel overwhelming when I think about teaching these concepts to my children.
Well let me tell ya, the Personal Finance Lab Budgeting Game, Stock Market Game, and Integrated Curriculum from Personal Finance Lab just made it SO incredibly easy!
We have tried several different courses, unit studies, and even lapbooks to teach the kids about things like budgeting, banking, and investing. Nothing I had put in front of them was engaging or interesting to them. They were getting some general facts, but they weren't getting the experience that is so important for really understanding how to deal with money and budgets on a daily basis.
My daughter was begging to do this every.single.day. Even on the weekends! She was excited to see what would be thrown at her next. She was challenged by the choices that she had to make. She learned from the not-so-great choices and was encouraged when she "got it right."
She didn't start out that way, however. I was the one doing the begging! Her past experiences with finance curriculum had been so dull that she was reluctant to even consider doing another one.
But I'm getting ahead of myself.
What is Personal Finance Lab?
PersonalFinanceLab.com is a web-based "game" that uses simulations to teach personal budgeting and stock market investing. While it was developed for classroom use, it works wonderfully in a homeschool setting as well.
Everything is web-based, and you get a lot of content with your purchase. Here's a list from their website of what's included:
- World-class portfolio simulation
- Over 100 integrated lessons in personal finance, economics, business, social studies, and math
- Automatically graded quizzes to encourage concept mastery, built into each lesson
- Interactive personal finance and business calculators focused on saving, investing, and much more
- Learning center with over 600 articles, videos, glossary terms, and more
- Tutorial videos to help both teachers and students get started and excel
- Live support from our financial education team during normal business hours
- Investing 101 course - 10 chapter investing course that is available to all students
It is written for high school, but my 8th-grade daughter caught on fairly quickly, so it would also work well for middle school in my opinion.
To be completely transparent, I didn't think we would get past the setup portion of the simulation. It took a really long time. There are a lot of different options to choose from and not a great deal of information defining those options or explaining how they would impact the simulation. It was a little overwhelming at first, but we finally figured it out.
The setup allows you to define some parameters for the student, such as whether they work part time or full time, whether they attend college or just work, how much cash they start with, and things of that nature. You also set up how many months you'd like the simulation to last and what they will pay for rent, utilities, and other misc. living expenses.
The student begins the budgeting game as a working college student. They first have to make some preliminary choices:
- Where will they live? Will they have roommates? If so, how many? These things will affect the amount of rent they pay each month.
- How and what will they eat? Will they eat out frequently? Will they survive on noodles and juice, or buy organic vegetables each week? These things will affect their grocery budget for the month.
- What type of phone plan do they need? Will they choose the cheap bare minimum, or go all out with unlimited everything? This will affect their cell phone bill each month.
These are just some examples, but they give you an idea of the decisions that must be made immediately when starting the simulation.
As the student goes through each day of the month, lots of things happen. On some days, they will have regular bills due that they must remember to pay. They receive a paycheck each Friday that shows what has been removed from the gross pay.
As the student continues to play, they are given lots of random and engaging choices to make.
For example, every Friday they are given the choice of how to spend their time. They can socialize, work extra hours, study, or take care of household chores. Every choice that they make affects the simulation in some way . . . some good, and some bad.
Then, just like in the real world, random things begin to happen that throws the entire budget into chaos! Sometimes those random things add extra money to the budget, and sometimes they take everything that is saved and more!
Here are a few of the things that we ran into during the game.
We earned some extra income from being a responsible and friendly employee.
Then we had some unexpected opportunities to crop up.
Of course, there are always those moments when we have to make a choice between what we need and what we want and the simulation even offered some of those.
There were even a couple of times that we got SLAMMED with some hefty unexpected bills.
You may have noticed that most of these random choices have the option to pay with either a credit or debit card. The simulation allows you to set up a credit account for your student in order to teach them about handling credit card debt.
I think this is a fabulous way to simulate exactly what can happen when credit cards are used irresponsibly without having to actually ruin your credit in the process.
My daughter decided after the first month to put all of her unexpected (unbudgeted) expenses on her credit account and then pay it off each month. This gave her a record of everything that had popped up unexpectedly throughout the month. While we don't personally use credit cards in that way, I thought it was pretty smart thinking on her part. UNTIL . . . she got walloped with that $650 car repair bill. Suddenly, she had more credit card debt than she had cash to pay it off. That led to working extra hours every weekend for the next few weeks, which caused her grades to suffer, and then things in her apartment started to fall apart because she wasn't caring for them. You know . . . sort of like things happen in the real world when we get tangled up in more debt than we can handle.
She learned quickly that debt has consequences, not just on her bank account, but in many other areas of her life as well.
At any point during the month, she was able to see the money that came in and went out on the calendar view.
Then before the new month begins, she would see an itemized list of the expected cash outflow for the month. She was able to set an amount that she hoped to save for that month based on the figures.
As if all of that wasn't great enough, there are short lessons interspersed throughout the simulation. Some of the lessons that we encountered were on topics such as:
- Managing your bills - how to effectively prioritize your bills and manage times of tight cash
- Preparing for spending shocks - learning how spending shocks can derail the budget
- Understanding paychecks and deductions
- Filing Taxes
- Writing a check correctly
- Net worth - what it is and how it's calculated
We haven't yet made it to the stock market part of the simulation, but I'm certain that it will be just as engaging as the budgeting part. I have been thrilled with how much my daughter has learned from this game.
Don't Just Take My Word For It!
This is only one of twenty-five reviews that are available for the Personal Finance Lab Budgeting Game, Stock Market Game, and Integrated Curriculum. Be sure to visit the Homeschool Review Crew page to read more reviews by clicking on the banner below.