- Understand that limited resources require choices
- Understand the basic concept of a budget
- Use addition, subtraction, multiplication, and division (with whole numbers, fractions, decimals and/or percents, mixed numbers) to solve real-world math problems that will help them understand the concepts of money management and budgeting
Chart paper or chalkboard, marker or chalk, Student Magazine Pages 4-5: Time to Choose! (PDF), pencils
Discuss with students: What does the word choice mean? Why do we have to make choices when we decide how to spend money? What are some things that kids spend money on? Write student answers on the board or chart paper.
- Explain to students that money is a limited resource, meaning that there are usually more things that we want than we have money for. For example, if you have $1 to spend, you can't spend more than $1. This requires a person to make a choice.
- Ask students what they consider when they make a decision about how to spend their money (e.g., It's something I want; I have enough money; I will have some money left over for something else).
- Tell the class that they're going to practice making a budget: Simply put, a budget shows how much money you have (income) versus how much you spend (expenses).
- Divide students into groups. Each group is going to help decide how to spend money for a class party. Ask for volunteers to write the following on the board or chart paper:
- Ask each group to work together to decide how they want to spend the $28.00.
Do the Math:
Add columns next to each item on the board or chart paper. Have a volunteer from each group check off the items that their group chose. Next, add each group's total expenses.
Subtract expenses from the budget of $28.00. Are the expenses less than your budget? If so, you are under budget. Are expenses greater than your budget? If so, what items can be cut to stay within budget?
Discuss with students: Why does staying in budget mean? What things does someone have to consider when making a choice about what to spend?
Have students bring in and discuss examples from books, magazines, and movies where people deal with budgets and make decisions about how to spend money. What decisions were made, and why?
Language Arts Extension:
Expository: Writing Situation: Everyone has to make decisions when it comes to spending money. Directions for Writing: Think about a time when you had to decide how to spend money. Now explain why you made the choice that you did.
Have students read Student Magazine Pages 4-5: Time to Choose! (PDF), in class or at home, and complete the problems on page 4-5.
Student Magazine Answers (PDF)