Module 7: Managing your money

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Module 7 Managing your money saving
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• Module objectives
• Provide an opportunity to look at the learner
  outcomes in the Manage money element of the
  numeracy component of the National Literacy
  and Numeracy Framework (LNF) to identify where
  teaching learners about the basic principles
  of saving exists in the curriculum in Wales.
• Highlight resources and activities that can be
  used in Key Stages 2 to 3 to develop learners
  numeracy skills in the context of saving and
  investing money.
• Provide a list of useful websites for Key
  Stages 25 to have access to classroom ideas
  for saving and investing money.
• Note Differentiation, extension ideas and
  effective questioning will often be suggested in
  the notes within the PowerPoint for
  teachers/trainers to use as required.

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Learner aims

• This module introduces the basic principles
  involved in the process of saving money.
• Learners will be able to
• understand that there are different ways of
  saving
• appreciate the basic principles of saving money
• describe some short- and long-term benefits to
  saving
• identify the main features of a savings account
  and the steps involved in opening an account
• understand that earning interest can help
  savings grow
• calculate and compare simple and compound
  interest
• appreciate the risks involved in different ways
  of saving and investing.
• The module is designed for use across key stages
  not all outcomes will apply to all learners.

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An opportunity to look at the learner outcomes
in the Manage money element of the numeracy
component of the LNF to identify where
understanding the principles of saving money
exists in the curriculum in Wales.Learner
outcomes relating to saving are marked in bold
in the table.
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Manage money Learners are able to
Year 3 use different combinations of money to pay for items up to 2 and calculate the change order and compare items up to 10 record money spent and saved.
Year 4 use money to pay for items up to 10 and calculate the change order and compare items up to 100 add and subtract totals less than 10 using correct notation, e.g. 6.85 2.76 manage money, compare costs from different retailers and determine what can be bought within a given budget.
Year 5 order and compare the cost of items up to 1 000 add and subtract totals less than 100 using correct notation, e.g. 28.18 33.45 plan and track money and savings by keeping accurate records realise that budgeting is important.
Year 6 use the terms profit and loss in buying and selling activities and make calculations for this understand the advantages and disadvantages of using bank accounts make comparisons between prices and understand which is best value for money.
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Manage money Learners are able to
Year 7 use profit and loss in buying and selling calculations understand the advantages and disadvantages of using bank accounts, including bank cards make informed decisions relating to discounts and special offers.
Year 8 carry out calculations relating to VAT, saving and borrowing appreciate the basic principles of budgeting, saving (including understanding compound interest) and borrowing.
Year 9 calculate using foreign money and exchange rates understand the risks involved in different ways of saving and investing describe why insurance is important and understand the impact of not being insured.
Extension use and understand efficient methods of calculating compound interest understand and demonstrate the real-life process of foreign exchange understand and calculate income tax.
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The Personal and social education framework for
7 to 19-year-olds in Wales also highlights
opportunities for learners to become competent at
managing their finances, planning for the future
and knowing where and how to access financial
advice. This module aims to address this in the
context of understanding the basic principles of
saving and investing money.
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Personal and social education framework for 7 to 19-year-olds in Wales
Key Stage 2 learning outcomes Range Preparing for lifelong learning
Learners should be given opportunities to understand ? that money is earned through work and can buy goods and services ? the importance of looking after their money and the benefits of regular saving.
Personal and social education framework for 7 to 19-year-olds in Wales
Key Stage 3 learning outcomes Range Preparing for lifelong learning
Learners should be given opportunities to understand ? the economic and ethical consequences of personal financial decision-making as a consumer, e.g. Fairtrade ? how to become competent at managing personal finances and recognise that saving provides financial independence.
Personal and social education framework for 7 to 19-year-olds in Wales
Key Stage 4 learning outcomes Range Preparing for lifelong learning
Learners should be given opportunities to understand ? their rights as consumers and their responsibilities in terms of managing a budget ? the importance of planning for their financial futures and how to access financial advice.
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The big question
What is saving?
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Places we use to save our money
Starter activity
Can you name some places where you can save your
money?
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Places we use to save our money
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Advantages to saving money
Starter activity
Why do people save money?
Why is saving a good alternative to borrowing
money?
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Reasons to save money
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Saving activities
Key stage Activity Whats it about?
Suitable for lower Key Stage 2 1. Saving up Considers spending and saving.
Suitable for upper Key Stage 2 2. Once upon a time A fictitious but realistic advertisement for a childrens savings account.
Suitable for Key Stage 3 3. Did versus didnt Explores scenarios about the spending and saving of six young people.
Suitable for Key Stage 3 4. Paying it in Investigates the key features of a savings account.
Suitable for upper Key Stage 3 5. Savings and investments matching cards games Promotes vocabulary which allows learners to understand different types of saving and investing.
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Activity 1
Resource Manage money activity sheet Saving up
Activity The activity is aimed at younger
learners and consolidates some of the previous
starter/discussion ideas. It encourages learners
to think about what they might spend money on,
save up for and where they can save their money.
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Activity 2
Resources Manage money activity sheet Once
upon a time Activity Learners read a fictitious
but realistic advertisement for a childrens
savings account and answer the corresponding
questions.
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Activity 3
Resource Welsh Government Personal Finance
Toolkit Download the resource at
http//wales.gov.uk/topics/childrenyoungpeople/pub
lications/resources/?skip1langen Activity
Did vs. didnt Topic 2, Saving for the future
(pages 2227), should be used with the
accompanying Resource sheet 1 entitled Did vs.
didnt (pages 1719).
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Activity 3
Did vs. didnt The resource provides learners
with six scenarios about a group of young people
spending and saving. It is suitable for Key
Stages 3 and 4. The toolkit provides detailed
lesson ideas of how to deliver the activity with
learners.
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Savings accounts What to look out for
There are many different accounts with many
different features for young people. Working in
groups, learners can come up with information
they need to gather about opening a savings
account.
Age?
Access?
Minimum deposits?
Interest rate?
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Savings accounts What to look out for
Features What some banks may offer
Age Savings accounts with a minimum age. Different saving accounts available for different age groups.
Access Unlimited instant access to funds (by young person or adult). Occasional access to funds. No access to funds until young person is 18, for example. A notice period may be required, such as 7, 30, 60 or 90 days.
Interest rate Introductory interest rate. Fixed/variable interest rate for a limited amount of time.
Deposits Minimum deposit required to open the account. Certain amount to be paid in regularly. Unlimited deposits.
Operate account Online. Branch. Use of cash card or debit card.
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Activity 4
Resource Welsh Government Personal Finance
Toolkit Download the resource at
http//wales.gov.uk/topics/childrenyoungpeople/pub
lications/resources/?skip1langen Activity
Paying it in Topic 2, Saving for the future
(pages 2227), should be used with the
accompanying Resource sheet 3 entitled Customer
cards (pages 2122).
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Activity 4
Paying it in In this activity, learners discuss
or role play opening a savings account and
identifying the key features. The toolkit
provides detailed lesson ideas of how to deliver
the activity. Learners will need account
leaflets or printed online information for a
range of savings accounts (or internet access to
investigate for themselves) from several banks or
other providers, such as building societies or
credit unions. Alternatively to carry out a
savings comparison go to https//compare.moneyadvi
ceservice.org.uk/savings
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Some types of savings products for young people
Discussion activity What do you know about the
following types of savings?
Junior Cash ISA
Child Trust Fund
Childrens Bonds
For more information on Child Trust Fund and
Junior Cash ISAs visit www.direct.gov.uk/childtrus
tfund and www.direct.gov.uk/juniorisa For
further information on childrens bonds
www.moneyadviceservice.org.uk/en/articles/children
s-bonds
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Save or invest?Do you know the difference?
Saving
Investing
Using money by buying things that might increase
in value, like property, stocks or shares in a
fund.
Putting money aside to make a lump sum, for a
rainy day, or a short-term goal such as the
purchase an expensive item.
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Activity 5
One of the Year 9 learner outcomes of the Manage
money element of the numeracy component of the
LNF is understand the risks involved in
different ways of saving and investing.
Activity 5 shares some ideas you may choose to
support this. Starter activities
Savings and investments matching cards games
Print off Resource 1 and Resource 2 available
within this module.
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Risk and return
Risk
Return

• Risk is another name for chance and uncertainty
  Examples of types of risk
• an agreed interest rate may not be a good
  value in the future
• an investment may fall in value.

Return is the amount of money you get back on the
investment you have made. A higher return often
comes with riskier investments. Remember if it
sounds too good to be true it probably is.
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Risk and return
Cerys and Rhys each decide to invest 400. From
the information below who received the best
return on their money?
After one year
Cerys 400 decreased by 5
Rhys 400 increased by 15
Calculate the difference between the amount of
money each person has at the end of the
year. This type of question allows learners to
see that money is not always gained when invested.
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Risk and return
Discussion activity
Mr Jones invests his money by buying houses that
are cheap and selling them again for more than
they cost him to purchase and the cost of the
improvements.
Mr Evans invests his money by buying gold and
then selling it when the price goes up.
Can you think of other ways to invest? Can you
describe an advantage and disadvantage of each of
the scenarios above?
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Risk and return
One of the Year 9 learner outcomes of the Manage
money element of the numeracy component of the
LNF is understand the risks involved in
different ways of saving and investing. One
opportunity to support the delivery of this can
be found at the Risks and Rewards website that
can be accessed at https//hwb.wales.gov.uk/cms/hw
bcontent/_layouts/NGFLSolution/MaterialDescription
.aspx?LearningMaterialId50874langen The
resource covers a range of material, from looking
at the role of banks to different kinds of
investments. The material is provided in a
variety of forms such as cartoons, games, video,
audio exercises and written text. Teachers of
mathematics, PSE, history, business studies and
economics from Key Stage 2 to post-16 may find
this resource useful.
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• The Manage money element of the numeracy
  component of the LNF includes the following
  learning outcomes.
• Year 8
• Carry out calculations relating to VAT,
  saving and borrowing.
• Appreciate the basic principles of budgeting,
  saving (including understanding compound
  interest) and borrowing.
• Extension
• Use and understand efficient methods of
  calculating compound interest.
• Questions based on these learner outcomes are
  likely to be done in mathematics lessons.
• The next few slides introduce the definition of
  simple and compound interest, calculations, and
  two interactive online tools that learners can
  use to help them calculate compound interest.

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Simple and compound interest
Starter activity Fill in the missing words. In
a savings account the amount of money earned is
called . The original amount of money
deposited is the Interest that is earned
only on the principal is called . In a
savings account, ..is when the bank pays
interest on both the principal amount and the
interest already earned.
principal
interest
simple interest
compound interest
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Simple and compound interest
Answers In a savings account the amount of
money earned is called . The
original amount of money deposited is the
.Interest that is earned only on the
principal is called
. In a savings account,
is when the bank pays interest
on both the principal amount and the interest
already earned.
interest
principal
simple interest
compound interest
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An introduction to calculating simple interest
Sophie pays 300 into a savings account, and
leaves it there for 4 years to watch it
grow. The bank offers a rate of 5 simple
interest per annum. (This means the bank will pay
Sophie 5 of the money she has invested.) Questio
ns 1. How much interest did Sophie gain? 2. How
much money does Sophie have in her savings
account at the end of the 4 years?
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An introduction to calculating simple interest
1. How much interest did Sophie gain? 10 of
300 30 5 15
Sophie gets 15 per year, so in 4 years 4 x
15 60 Sophie gained 60 interest 2. How
much money does Sophie have in her savings
account at the end of the 4 years? Total
amount principal interest 400
60 460
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Mathematics example Nia has 600 to invest in a
savings account. She intends to leave the money
in the account for 2 years, without adding more
or withdrawing any. She chooses between these
accounts.
2 year bond Pays 4 simple interest each year
Savings account 3 interest paid each year and
added to the savings amount
Simple interest
Compound interest
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2 year bond Pays 4 simple interest each year
Savings account 4 interest paid each year and
added to the savings amount

Solution 400 x 0.04 16 In 2 years 16 x 2
32 interest earned
Solution 1st year 400 x 0.04 16 2nd
year 416 x 0.04 16.64 interest earned
32.64
Nia should invest her money in the savings
account because it earns 0.64 more interest.
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Interactive tools
Learners could use an interactive online savings
calculator to investigate the effect of compound
interest. Two examples of an online tool that
can be used are shown on the next few slides.
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www.hwb.wales.gov.uk/cms/hwbcontent/Shared20Docum
ents/VTC/ngfl/maths/r_davies/compound_calc/Compoun
d20Interest20Calc.htm
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www.moneymatterstome.co.uk/Interactive-Tools/Gener
alInterestCalculator.htm
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• Learners can visit
• www.hwb.wales.gov.uk/cms/hwbcontent/Shared20Docum
  ents/VTC/ngfl/maths/r_davies/compound_calc/Compoun
  d20Interest20Calc.htm
• The bilingual interactive activity allows
  learners to change four variables
• initial value (principal amount)
• annual investment (yearly payments)
• period (length of time in years)
• annual increase (Interest rate).
• Learners can use the interactive tool to compare
  the effect that changing the variables has on the
  total amount of money in the savings account.
  (Note this final amount is rounded to nearest
  one pound.)

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• Learners can visit www.moneymatterstome.co.uk/Inte
  ractive-tools/GeneralInterestCalculator.htm.
• The interactive activity allows learners to
  change four variables
• lump sum (principal amount)
• interest rate
• savings period (length of time in months)
• monthly payments.
• This interactive tool allows learners to be
  presented with the same methodology as the
  previous online tool but using different
  vocabulary. It allows using decimal values as
  interest rates and the savings period is
  presented in months.

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Calculating simple and compound
interest Extension activity Use the interactive
tools (or an effective calculator method to
calculate compound interest) to compare how the
growth in a savings account with compound
interest is different from the growth in an
account with simple interest. Encourage learners
to present their workings in tables and a
suitable graph. Allow them to decide the
principal amount, annual investment (can be zero
if no money is to be added to the account) and
interest rate. Learners can compare how the two
types of savings grew over five years.
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This document is designed to assist teachers to
recognise and promote higher-order mathematical
skills within Key Stage 3 and through to Key
Stage 4. It provides examples of learners work
accompanied by commentary that identifies the
characteristics of higher-order mathematical
skills. Pages 4952 demonstrate an example of
learners work comparing compound and simple
interest.
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The Money Charity

• The Money Charity (formerly Credit Action) is a
  UK money education charity supporting young
  people to manage their money. For further
  information visit www.themoneycharity.org.uk
• The website also presents modules of work for
  learners from Key Stage 3 upwards specifically to
  help secondary school educators teach their
  learners about financial education.
• To view the materials visit http//themoneycharity
  .org.uk/workshops-training/schools-colleges/  

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Adding up to a lifetime

• This is a free online resource which follows four
  characters and how they deal with financial
  situations. It is suitable for Key Stage 3 to Key
  Stage 5. The package is approximately 25 hours of
  learning activities which learners can complete
  online. It is presented as five modules
• Life as a student (aged 14 upwards)
• Working life
• Relationships
• New life
• Active retirement.
• www.addinguptoalifetime.org.uk
• A whole range of managing money topics are
  included. Module 1 has a section on savings.

Each module has an audio tutorial which can be
listened to in English or Welsh.
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Websites and resources

• http//themoneycharity.org.uk/workshops-training
  /schools-colleges/  
• Budgeting tools and advice for young people.
• www.barclaysmoneyskills.com
• Ideas, activities and resources for young
  people about saving and investing.
• www.rbsmoneysense.co.uk/schools
• A free interactive programme giving learners
  the skills to manage their money.
• www.nationwideeducation.co.uk
• Finance Skills games, factsheets and
  worksheets for learners aged 4 to 18
  (printable resources and online games). Welsh
  versions available.
• www.pfeg.org
• pfeg (Personal Finance Education Group) an
  independent charity providing a wealth of
  resources to support financial education in
  schools. See examples such as My Money
  Mathematics Resources, Money Works Its your
  business and Learning about Money in the
  Primary Classroom which are relevant for this
  module on saving and investing.

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Websites and resources

• www.moneyadviceservice.org.uk/
• Free online advice and guidance on all money
  topics. Free booklets available see the one
  relevant for this module entitled Saving and
  investing.
• www.direct.gov.uk/childtrustfund and
  www.direct.gov.uk/juniorisa
• For more information on saving products.
• www.risksandrewards.org.uk
• The site covers a range of material, from
  looking at the role of banks to different
  kinds of investments suitable for learners in Key
  Stages 2 to 5.
• www.addinguptoalifetime.org.uk
• Online interactive programme for learners Key
  Stage 3 to post-16.
• www.moneymatterstome.co.uk/Interactive-Tools/Gen
  eralInterestCalculator.htm
• Interactive online calculator tool to
  investigate the effects of compound interest.
• www.hwb.wales.gov.uk/cms/hwbcontent/Shared20Docum
  ents/VTC/ngfl/maths/r_davies/compound_calc/Compoun
  d20Interest20Calc.htm Bilingual interactive
  online tool to calculate the effect of compound
  interest.