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P. 8
Objective
Materials
• Paper • Pencil
Students will understand the importance of saving money for the future.
Students will begin to recognize the differences in long-term and short-term savings.
Critical Thinking Activity
Why Should We Save Money?
To Keep or Not to Keep
• Short-term savings and long-term savings are two ways to save money.
• Short-term savings are used for purchases in the near future such as a pair of shoes, a cell phone or concert tickets.
• Long-term savings are used for purchases in the more distant future, such as buying a house, paying for college, saving for retirement, unexpected events or purchases.
• Savings accounts are mainly used for short-term savings. The money in this type of account is easy to access.
• Long-term savings might be put into an IRA or invested. The money in these accounts is not readily accessible and often has penalties if it is taken out early.
Procedure
1. Create a list of items that you would like to purchase or things you’d like to do (younger students can draw pictures).
2. Separate the list into needs and wants.
3. Choose one item from the needs column and estimate how much it might cost.
4. Choose an item from the want list and estimate its cost.
5. Determine if the items chosen would require money to be saved in a short-term account or a long-term account.
Discussion Questions
1. What are examples of needs?
• Food, clothing, a place to live, etc.
2. What are examples of wants?
• A trip to the amusement park, eating out instead of at home, a new bike, etc.
3. Are there some things some people listed as “needs” and others listed as “wants”?
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• Poll the students and discuss.