Classroom Financial Literacy Program on AllowanceTree.com

TEACHER’S GUIDE

Goal:
Teach students (5th – 9th grade) real-world financial skills and healthy money habits in a fun, interactive online environment. The program is mostly done in students’ spare time so very little class time is required.

Materials:
1. Internet access
2. http://AllowanceTree.com
3. Email addresses for your students (or one of their parents) – see permission slip below
4. Teacher premium code (you will get this from us via email).

Time Requirements:
1. Teacher one-time set-up: 15 – 30 minutes (our email or phone assistance is available!)
2. Little to no class-time required beyond explaining the program to students.
3. Teachers can update settings on a weekly basis: 5-10 minutes.

On AllowanceTree.com, students receive and manage their weekly virtual money income over the course of a quarter, semester or year. They can budget, save, earn interest, donate to charity, invest and diversify their investments. In the Grades Stock Market, students can buy and sell “shares” in their classes (or in just your class), and the share prices depend on their grades. If their grades go up, so do their share prices, and they can sell their shares at a profit. They therefore not only learn about the stock market, but are also encouraged to do better in your class. Students can also learn to avoid debt by taking out loans with negotiated minimum monthly payments and interest rates, and each student has their own credit score.

Students earn points, badges, and increasing rank as they manage their money. At the end of the year (or term), recognition or prizes can be given to the students who manage their money the best. Class credit or grades can be given for how well they perform in the Program, at the teacher’s discretion. (This grade can be based on the points & rank they attain during the program.)

AllowanceTree is designed for children ages 8-16, and their parents.
The Classroom Financial Literacy Program is ideal for teachers and their students, grades 5 through 9.

If you would like help setting up the program, contact us (team@allowancetree.com or 949-230-3293) and we will be happy to assist you.

You will sign up on AllowanceTree as a “parent” and you will add the students in your class as your “children.” You will give each student the same virtual money income every week, and their goal is to manage it well and see who can build the most successful portfolio over the course of the semester (or school year).

Feel free to browse the site by visiting www.AllowanceTree.com and clicking on the “Demo It” button. Although AllowanceTree is usually used between parents and children as a virtual online family bank that represents the child’s real allowance money, below you will find a step-by-step guide for setting up and using AllowanceTree.com as a Financial Literacy Program in your classroom or homeroom (using virtual money).

A. Notify Parents:

Based on your school’s protocols, you may need to obtain the necessary permission from parents to use their child’s email address, since the program automatically sends email notifications to report on tasks and milestones.

• See below for a sample Permission Slip text you might use or customize.

B. SignUp:    (5-15 mins, depending on how many students you have in the class)

B1. Email team@allowancetree.com to request your teacher promo code. (Please put Teacher Promo Code in the subject box.) This will enable you to use the full range of functionality with your class at no cost.

B2. Visit http://AllowanceTree.com and click “Sign Up.”

B3. Select “Parents” from the top drop-down menu, and enter your information.

B4. Select “Go Full” on the package options page, and on the following payment page, click on the promo code link beside the PayPal button and enter your promo code.

B5. Enter each student in your class as a “child”, along with their email address. (Do not worry about using an accurate date of birth for each student.)

B6. Enter the weekly income (“Allowance”) that each student will receive (in virtual online dollars).

• This will be the money they will manage on the system.
• You can choose any allowance amount for your students. We recommend it be in the $10 – $100 range, but the discretion is yours.
• When entering their income amounts, select “weekly” deposits that are deposited “immediately.”

B7. Each of your students will receive an email with a link for them to follow in order to activate their accounts. Once activated, they can begin managing their virtual money.

C. SetUp:    (10-30 mins, and only needs to be done once.)

Once you are signed up, you will need to set up:

• their Savings interest rates
• the Grades Stock Market
• their “Chores” — classroom citizenship or other value-based classroom activities or responsibilities, at the teacher or school’s discretion.

The interface your students will use to manage their money looks like this:

C1. Switch Savings interest ON for each of your students by visiting your Settings Tab and clicking on the Savings sub-tab (http://www.allowancetree.com/settings_savings).

• Start them each at 5% since they all start out with the rank of Penny Private. As students rank up, you can change their interest rates according to the rank table on the interest page.

C2. Set up your Grades Stock Market by visiting your Settings Tab and clicking on the Grades sub-tab (http://www.allowancetree.com/settings_grades).

• Ordinarily, parents enter their child’s classes in the Grades Stock Market, and then the share prices are determined by their grades in each class, ex: 80% in Algebra means that Algebra shares would cost 80 cents each. Children can buy and sell shares whenever they want. This incentivizes them to do better in class since, if their grade goes up, they can sell shares for a profit.
• If your classroom is a single subject, like Math, use “Overall Grade,” “Homework Grade,” etc as the “classes.” If you use AllowanceTree with your homeroom class, you can do the same, or use a selection of the students’ classes, or classes they all have in common, at your discretion.
• It’s a good idea to have several “classes” in which students can buy shares since that will best simulate a stock market with multiple shares from which to choose. One grade type is doable, but that only gives the Stock Market one “company” to buy shares in, so two to four is preferable.
• Tip: Each student’s settings are on a separate tab for you, so you have to enter the grade elements (“Classes”) on each student’s tab, and then save the changes on each tab. (Copy & paste to save time.)
• This set-up only needs to be done once. You should update these grades for your class as often as is convenient, but at least once a week.

C3. Students can invest in precious metals with their virtual money.

• They earn points and badges for this diversification of their investments, and they can then enjoy watching the value of their precious metals portfolio change as the daily market prices fluctuate. (AllowanceTree displays the live market prices.)
• Every purchase sends you an email to approve or decline the purchase. In your role as teacher, you would always approve metals purchases since it is not a real purchase (as it is when parent and children use AllowanceTree at home).

C4. Use the Chores module (http://www.allowancetree.com/settings_chores ) to assign tasks to your students that can earn them bonus income or decrease their income, based on their performance.

• When used at home, parents use the Chores module to manage household chores, and can opt to tie financial incentives positively and/or negatively to chore performance, according to their own parenting style.
• In your class, you can use citizenship tasks, in-class chores or responsibilities, or even values-based items (at the discretion of the teacher or school principles) in place of “Chores”.
• For each task, a student’s performance grade can be updated anytime, at the teacher’s discretion, to Excellent, good, normal, sub-par or poor. Students can also petition for an improved grade by submitting a Chore “Report.”
• Each of the chore grades carries a financial bonus or penalty that affects their income.

C5. Students can donate to charity on AllowanceTree, and they earn bonus points when they do.

• Although in the classroom program, charitable donations are not made with real money, students will still earn points for donations on AllowanceTree.

C6. Students can apply for a Loan and must negotiate the minimum monthly payment and interest rate, and maintain a good credit score.

• When used at home, children can take loans from their parents in order to make purchases, and parents can approve, decline, or counter-offer any loan application.
• In class, students can take loans in order to buy precious metals or give charity. Their credit score will affect their points totals.

C7. Points & Badges are given for actions that represent good money management, so earning more points should be part of each student’s strategy.

• The more points they earn, they higher their rank goes and the better interest rates they get.
• Visit the Points & Rank page to learn more (http://www.allowancetree.com/points-and-rank ).

C8. You are free to award prizes or incentives to the students who manage their money the best over the course of the program.

• These might include recognition for the highest Portfolio value, the highest Rank (and points), and the most charitable donations.

C9. If you have any questions, no matter how small, please feel free to email us at team@allowancetree.com and we will respond as quickly as possible.

D. Regular Maintenance:

What will your time commitment be? What will you have to do (and how often) in order to run this program? The discretion is yours. We recommend updating grades and interest rates at least once a week.

D1. When students Rank-up, you should update their Savings interest rate according to the Interest Chart on the Savings Tab. Ideally, do this when the rank changes, but you can also do it once a week.

D2. Grades Stock Market: Ideally, update grades as soon as they become available, but you can also do it weekly. The more often you update grades, the more “movement” the shares in the market will have, which will improve the quality of the experience and student engagement.

D3. Once you have completed the set-up, your only maintenance will be updating the grades and interest rates on a weekly basis. This should not take more than 10-15 minutes each week.

D4. You will receive email notifications whenever your students take a meaningful action, but most of these will either not require any action to be taken on your part. If they do require an action, it will usually be a simple link on which to one-click.

E. Directions For Students:

As you begin the program, let students know what it is about, what it will involve, and what the goal is.

E1. Manage Your Money: The goal is for students to have a regular virtual income, as well as online financial autonomy so they can manage their money and learn how to make wise money choices.

• Wise money choices are about healthy money HABITS, not simply money knowledge. Your life is shaped by the choices you make habitually, not by what you think or know.
• AllowanceTree.com is designed to teach students money skills through habit-forming activities that also educate about money concepts. 

E2. Earn Points, Badges & Rank: Everything they do that represents good money management will earn them points and/or badges. As their points go up, so does their rank, which earns them better interest rates so they can make more money quicker.

E3. Strategize & Budget: Each student should think about budgeting their money between Savings, Investments, and Charity in such a way that grows their money (and points) most effectively. There are several approaches to this:

• Some experts recommend that we spend 40%, save 30%, invest 20% and donate 10% of our money.
• Feel free to also suggest other strategies, or encourage the students to develop their own. This might also make for an interesting assignment.
• The students should use their judgment and strategize in order to have the highest Portfolio or Points values at the end of the term.

F. Discussions & Lesson Plans:

F1. The AllowanceTree Financial Literacy Program allows many opportunities for discussion on a broad range of topics surrounding financial literacy and Math, as well as essential life skills and real-world financial situations.

F2. Lesson Plans will be coming soon. If you are interested in specific topics or lesson plans, feel free to email us the suggestion. You may also develop your own, and if you do, we would appreciate if you would share them with us.

Use (or customize) the following text to notify parents that the program will be running in the class, and that it will include the use of their child’s email address.

Dear Parents,

We will be running a Financial Literacy Program during the year in our classroom using www.AllowanceTree.com. AllowanceTree.com teaches kids healthy money habits on a fun, interactive platform that mirrors the real world of money in order to better prepare them to make wise money choices when they leave home.

Since it is an automated online system, it communicates with the students via email. The teacher will therefore need to enter each student’s email address. The system is a secure, closed system on which students can only interact with their teacher, and no personal information is shared.

Below, please either approve the use of your child’s email address, or if you would prefer, you may submit your own email address instead in order that your child can still receive the relevant notification via you. Without these notifications, they will not be able to keep abreast of their progress as effectively.

Please enter your child’s email address:

• I approve the use of my child’s email address: _____________________

Or enter your email address:

• I prefer the use of my email address:_____________________________

Parent Signature: _____________________

• Classroom Financial Literacy Program on AllowanceTree.com
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