Financial Literacy Brings Relevance for All Ages

At Ariel Community Academy, in Chicago, the financial-literacy curriculum provides real-world context for learning and helps students directly connect school with their future goals.

At Ariel Community Academy, in Chicago, the financial-literacy curriculum provides real-world context for learning and helps students directly connect school with their future goals.
Teacher sitting with students; head shot

Teaching about finance (left) begins in the early grades at Ariel; Principal Lenette Coleman (right) explains that the school’s point-of-view curriculum aims to help students feel confident in making their own decisions.

Credit: Zachary Fink

"Who remembers the sign for 'needs?'" a teacher asks a class of first graders. Little hands shoot up to form peaked roofs over their heads.

"Right! And how about the sign for 'wants?'"

This time, with their palms up and fingers forming W's, they curl their fingers towards themselves in a "gimme" gesture. "Good!" the teacher responds. "Now I'm going to show you some things and you tell me with your hands if they're needs or wants." She shows them a picture of a puppy. Most students identify the dog as a want. But one boy raises his hand and notes that if the puppy were a seeing-eye dog, it would be a need for a blind person.

  • Topic: Financial Literacy

  • School: Ariel Community Academy

  • Location: Chicago, IL

  • School Setting: Urban

  • Target Audience: Grades preK-8

  • Note: Demographic data below is from the 2010-11 academic year.

  • Enrollment: 521

  • Student Population:
  • 87% low-income (per Illinois School Report Card definition)
  • 98% African American
  • 2% Latino
  • 11% individualized education programs
  • <1% English-language learners
  • Note: Expenditures below are from 2009-10 academic year.

  • Average per-pupil operating expenditures:
  • School: $8,837 ($7,590 district funding + $1,247 Ariel Education Initiative funding; based on enrollment)
  • District: $13,078 (average for all grades; based on ADA*)
  • State (IL): $11,537 (average for all districts; based on ADA)
  • *average daily attendance

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Early Financial Literacy Pays Off

Duration: 06:06 min.

This is how educators at Ariel Community Academy, on the South Side of Chicago, teach financial literacy to their K-8 students -- by emphasizing the analysis and critical thinking that are essential to making good decisions about money. Ariel is a public K-8 school built on an investments curriculum that's intended to help demystify the financial world for kids. It is the brainchild of U.S. Secretary of Education Arne Duncan, then Chicago Public Schools CEO, and John Rogers, CEO and founder of Ariel Investments, and was created through former mayor Richard M. Daley's New School Initiative Program in 1996. The school receives standard funding from Chicago Public Schools, and the Ariel Education Initiative provides additional funds, which the school uses primarily to support personnel, including the school's curriculum director and two of its investments teachers.

At Ariel, 98 percent of the students are black, and nearly 90 percent of the students are from low-income families. The goal is to make school matter for these children, to make it relevant to the challenges they will face going forward -- succeeding in high school, graduating from college, and securing a future for themselves and their families -- in order to break the cycle of poverty.

It's a high bar to meet, of course, but so far, the results are impressive. Since 2002, Ariel has consistently outperformed its district, Chicago Public Schools, on the percent of students meeting or exceeding state standards in math, reading, and science. And since 2007, the school has outperformed both the district and the entire state of Illinois every year. Among their alumni, 97 percent have graduated from high school, and more than 65 percent of those students have enrolled in two- or four-year colleges, better than both the state and national averages.

Edutopia first visited Ariel in 2007 and produced a video about how they teach financial literacy and investments, especially in grades 5-8, and how this learning was transforming the students' aspirations for the future. The approach for younger students (grades K-4) is no less ambitious and emphasizes the building blocks of good decision making. Principal Lennette Coleman describes it this way: "Many students that don't have anything don't have hopes for wealth. Something is wrong if our children feel that only people who already have wealth and privilege should have access to those things."

So the school strives, even among the younger students, to build not just the critical-thinking skills that can illuminate the path to economic success but also the courage and confidence to put their ideas into action. Coleman calls it "critical behavior." She explains, "We want our students to think, 'I can do this. I'm going to think critically, come up with a good game plan, and I'm going to pursue it.'"

Financial Literacy for Elementary School

The financial-literacy curriculum at Ariel is designed for the K-8 spectrum. There are four main components: basic economics, personal finance, the business model, and investing. The curriculum is taught by their investments team, three teachers who work with the classroom teachers to incorporate the finance lessons.

Each incoming first-grade class receives $20,000 from the Ariel Education Initiative. This endowment stays in the Ariel mutual fund where it's managed until the class reaches grade four or five, and then is incrementally dispersed. Beginning in kindergarten, students receive investment classes one to three times a week, and these classes continue all the way through eighth grade. As the class advances, the students become more actively involved in making investment decisions for their endowment. By the time they're in eighth grade, each class has a full stock portfolio, and the goal is for students to be able to create a small-business plan and talk intelligently about what's happening in the market.

Here is an overview of the financial curriculum for the lower grades:

  • Kindergarten helps put words to the economic concepts they may already be familiar with. By talking about their families' spending choices, students become familiar with basic concepts such as scarcity and opportunity cost. Lessons often involve modeling clay to help students understand financial transactions. In one lesson, kids made two items, one to sell in a store and one to barter for something they wanted. They then had to decide the relative value of their goods to make the transactions.
  • First grade focuses on personal finance -- consumer spending and what it means to save your money. One first-grade lesson focused on planned versus unplanned spending. The investment teacher read to the class fictional scenarios about children or their parents making purchases, and the students had to identify them as planned or unplanned purchases. Later in first grade, students learn about advertising and credit and borrowing.
  • Second grade is a combination of economics and personal finance. Students start talking more about public finance, how cities make choices, and what taxes are. In the class we observed, students were learning about scarcity by preparing for a pretend camping trip. As a class, they compiled a long list of all the things one might bring on a camping trip. Then, working with partners, they made decisions about what to bring based on scarcity of space, time, and resources.
  • Third grade is about currency, monetary policy, and how money works. Kids learn about buying power, the value of different currencies, what the Federal Reserve System is, and what its role is in helping currency circulate throughout the United States. The lessons also integrate U.S. history by discussing the figures on U.S. currency and why they were chosen.
  • Fourth grade has a curriculum that's designed to be more fluid. Teachers are able to pick and choose lessons based on current events or the skill level of the students, and they can integrate the lessons with other subjects. Students learn about business models and the idea of investing. They also begin researching Chicago high schools and learn to identify and weigh the costs and benefits of each one to help them decide which they will apply to in eighth grade.

Why It Works

So how does the investments program foster success? It works by providing a realistic and familiar context that helps students see the connection between schooling and their life goals. Too often for students, the standard curriculum is abstract and, especially for students like those at Ariel who are predominantly black and from low-income backgrounds, can feel intended for kids whose lives are very different from their own. Thus, finding relevance in school is particularly critical to the success of these students so that they can see how education can directly help them rise above their circumstances.

Judith Shelton, curriculum director at Ariel, explains, "When students feel a connectedness to the importance of education, when they see the power of education to help them get closer to their goals as individuals, that's what keeps a very high sense of learning efficacy in them."

At Ariel, the curriculum is "real world, real time," as Coleman describes it. Teachers strive to make the content relatable to both the students' own lives and to the world at large. "Finance and economics are couched in a way that relates to their everyday lives and relates to decisions that they are actually making or will have to make in the future," explains Regina Beach, a K-5 teacher on the investments team. (You can read more about the benefits of teaching financial literacy in our research summary.)

Success Story

Shelton recalls running into a former student recently while at a meeting of teachers at the University of Illinois. "I heard this voice call 'Dr. Judy, Dr. Judy,' and I turned around and saw Michael!"

Michael Wilson graduated from Ariel in 2006. Shelton had counseled him through the high school application process. When they saw each other this time, he told her, "This school made me believe in myself, and I knew that I could really achieve what I wanted to. Maybe I wasn't the top student in the eighth-grade class, but in high school, I became it."

By the time he graduated from high school, he had offers from three colleges, and now he is a sophomore at the University of Illinois at Chicago studying psychology and taking pre-med courses. He is also a cadet in the Army ROTC and a private first class in the Illinois Army National Guard. Michael underscores what he told Shelton: "No one at that school ever gave up on me, and they always instilled in us that we should believe in ourselves." The most important lesson he learned at Ariel was that "it's not about the individual but the people surrounding that individual. Everyone has to play a part for that person to be successful."

It can be hard to see the impact of school when you're in the thick of it, whether as a teacher or a student. Day-to-day challenges cloud the big picture. But when students like Michael come back to share their reflections, it can all fall right into place. And the college-bound trajectory of many of Ariel's students is a testament to the school's impact. The greatest hope the educators at Ariel have for their work is that they are giving their students the tools to accomplish what might not have seemed possible before. So far, students seem to be living proof of their success.

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This article originally published on 3/28/2012

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check out the Secret

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check out the Secret Millionaires Club: Financial literacy resources for grades 3-6, teachers, parents, and youth orgs, + a contest for kids 7-14 (now in its 3rd year) with a $5,000 prize for each grand prize winner and a trip with a parent and teacher to meet Warren Buffett

economics and personal finance education

free materials

Was this helpful?

Please check out the St. Louis Fed's online personal finance interactive programs for high school students. The topics range from how to build human capital to earn that large income, to how to spend that income wisely. Of course that requires an understanding of saving and credit, which are also covered extensively. The programs are fun and entertaining, as well as effective. Please take a look at

We also have dozens of economics and personal finance lessons taught through the use of popular children's books, which, by the way, address the goals of the Common Core Standards. These lessons can be viewed through this page Note that most of the lessons include interactive whiteboards which is a feature used in the Ariel Community Academy unit.

These programs and materials are available and downloadable free-of-charge. There are many more resources - too many to mention here. Please take a look.

Neiman Marcus Launched A Financial Literacy Textbook?

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Well, not exactly ... but shortly after Neiman Marcus launched our book, KIPP Houston High School asked us to develop and teach a personal finance and "life 101" for their Class of 2010, which started us on our journey into the world of education. (The book was intended to be the basis of a sitcom.) Our book has since been approved by the (Texas) State Board of Education as a personal financial literacy ("PFL") textbook meeting 100% of the PFL mandates for high schools. But more importantly is has been "approved" by students who call it a "reality show in a book." To learn more, and read the press releases issued by KIPP, please go to the section of our website we developed specifically for teachers:

Financial Literacy Chapter Book Recommendations

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Check out these titles (Grades 3-6) that are both fun and educational reads but also teach important aspects of financial literacy. They're listed, along with a lot of other great resources, on the Jump$tart Coalition for Personal Financial Literacy clearinghouse:

My favorite title is Money Doesn't Grow on Trees:

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