UNIT 3.

21st Century Literacies

Introduction

“The convergence of media and technology in a global culture is changing the way we learn
about the world and challenging the very foundations of education. No longer is it enough to be
able to read the printed word; children, youth, and adults, too, need the ability to both critically
interpret the powerful images of a multimedia culture and express themselves in multiple media
forms. Media literacy education provides a framework and a pedagogy for the new literacy
needed for living, working and citizenship in the 21st century. Moreover, it paves the way to
mastering the skills required for lifelong learning in a constantly changing world.”

Lesson 12. Media Literacy

Learning Objectives
At the end of the lesson, you are expected to:
1. Define the aspects of Media Information Literacy (MIL)
2. State the Dimensions of MIL
3. Differentiate Advantages and disadvantages of Media and information

Presentation of Content

Media literacy is a set of skills that anyone can learn. Just as literacy is the ability to read
and write, media literacy refers to the ability to access, analyze, evaluate and create media
messages of all kinds. These are essential skills in today's world. Today, many people get most of
their information through complex combinations of text, images and sounds. We need to be able
to navigate this complex media environment, to make sense of the media messages that bombard
us every day, and to express ourselves using a variety of media tools and technologies. Media
literate youth and adults are better able to decipher the complex messages we receive from
television, radio, newspapers, magazines, books, billboards, signs, packaging, marketing
materials, video games, recorded music, the Internet and other forms of media. They can
understand how these media messages are constructed, and discover how they create meaning –
usually in ways hidden beneath the surface. People who are media literate can also create their
own media, becoming active participants in our media culture.
Media literacy helps learners:
• Understand how media messages create meaning
• Identify who created a particular media message
• Recognize what the media maker wants us to believe or do
• Name the "tools of persuasion" used
• Recognize bias, spin, misinformation and lies
• Discover the part of the story that's not being told
• Evaluate media messages based on our own experiences, beliefs and values
• Create and distribute our own media messages
• Become advocates for change in our media system

Media literacy education helps to develop critical thinking and active participation in our
media culture. The goal is to give youth and adults greater freedom by empowering them to
access, analyze, evaluate, and create media. In schools: Educational standards in many states --
in language arts, social studies, health and other subjects -- include the skills of accessing,
analyzing and evaluating information found in media. These are media literacy skills, though the
standards may not use that term. Teachers know that students like to examine and talk about their
own media, and they've found that media literacy is an engaging way to explore a wide array of
topics and issues. In the community: Researchers and practitioners recognize that media literacy
education is an important tool in addressing alcohol, tobacco and other drug use; obesity and
eating disorders; bullying and violence; gender identity and sexuality; racism and other forms of
discrimination and oppression; and life skills. Media literacy skills can empower people and
communities usually shut out of the media system to tell their own stories, share their
perspectives, and work for justice.
In public life: Media literacy helps us understand how media create cultures, and how the
"media monopoly" - the handful of giant corporations that control most of our media - affects our
politics and our society. Media literacy encourages and empowers youth and adults to change our
media system, and to create new, more just and more accessible media networks
What do Scholars and Researchers have to say?
Media literacy is most commonly described as a skill set that promotes critical
engagement with messages produced by the media. At its most basic, media literacy is the
“active inquiry and critical thinking about the messages we receive and create,” (Hobbs &
Jensen, 2009), and most proponents emphasize this connection to critical thinking. The U.S.
National Association for Media Literacy Education (NAMLE) defines media literacy as “the
ability to access, analyze, evaluate, create, and act using all forms of communication.” What is
notable about these definitions, and what we will see often forms the basis of media literacy
curricula, is a focus on the interpretive responsibilities of the individual. As O’Neill (2010)
observes, children are expected “to negotiate the risks and opportunities of the online world with
diminishing degrees of institutional support from trusted information sources.” Most media
literacy scholars advocate a rich vision for media literacy that includes communal sense making
and empowers people to think critically and engage meaningfully, ideally contributing positively
to their communities (Hobbs, 2013) and engaging in meaningful behavioral change (Hobbs and
McGee, 2014; Buckingham, 2017). However, most trainings focus on individual responsibility
rather than the roles of the community, state, institutions, or developers of technologies. This also
highlights the importance of different media literacies for different populations— media literacy
curricula are often targeted toward children and youth, but media literacy for adults is equally
important as impacts of the “diminishing degrees of institutional support” become evident across
demographics.
Historically, there have been countless theories about the role of media in society; these
theories have each hinged on different values. Centuries ago, Plato and other philosophers
attempted to specify the difference between media that informed and that which persuaded.5 As
liberalism became a dominant political philosophy, discussions around media shifted to focus on
balancing the protection of rights with positive contributions to society; in Areopagitica,
published in 1644, John Milton argued against Parliamentary censorship of publications,
upholding the benefits of diversity of opinions – even those ideas that prove to be wrong – as an
essential part of civilized society. Milton advocated for education as the path to empowering
individuals to engage in civil society—if one does not censor the incorrect communication of
another, one has to gird oneself against its potential harms.6 This theme of media literacy as a
bulwark against harm was enshrined in modern doctrine in 1938, when the Spens Report,
published in the UK, characterized media as a “corrupting influence,” likening it to diseases such
as polio that necessitated inoculation (Masterman, 2001). Media education as a form of
inoculation translated to pedagogies focused on resistance against media that persisted until the
early 1960s (Masterman, 2001; Anderson, 2008). The field of media literacy in its current form
took shape starting in the late 1970s, with systematic efforts toward curricular development and
research (Arke, 2012). While definitions of media literacy remain fluid and contested (Anderson,
2008; Abreu, Mihailidis, Lee, Melki, & McDougall, 2017), media historian Edward Arke
identifies the 1992 National Leadership Conference on Media Literacy as a moment when media
literacy education scholars and practitioners agreed to the definition of media literacy as “the
ability to access, analyze, evaluate and communicate messages in a variety of forms”
(Aufderheide, 1993), which establishes key components of NAMLE’s current definition. These
definitions began a shift away from protection or inoculation and toward empowerment. Leading
media literacy theorist Renee Hobbs, in a body of work spanning over three decades, describes
media literacy as a fluid practice that is both individual and communal and not simply
inoculation against negative messaging but empowerment to engage with media as citizens
(Hobbs, 1998; Hobbs, 2010; Hobbs, 2017).
This view of media literacy as a multi-faceted, flexible, and empowering response is
supported by Dafna Lemish’s (2015) research on children’s media use and David Buckingham’s
(2003) assertion that media literacy education must balance protectionism with preparation. Paul
Mihailidis further supports that media literacy is a communal experience (2014) and a necessary
competency for engaged citizenship (Mihailidis & Thevenin, 2013). In Livingstone’s (2011)
research on youth media practices globally, she finds that youth are not homogenous in their
responses to media, but rather individuals with their own agency. These values are reflected in
media literacy programs throughout the US across five thematic areas: youth participation,
teacher training, parental support, policy initiatives, and evidence bases.
Dimensions of Media and Information Literacy
 The study and practice of media literacy is based on a number of fundamental concepts
about media messages, our media system, and the role of media literacy in bringing about
change. Understanding these concepts is an essential first step in media and information literacy
education.
Basic Dimensions
1. Media construct our culture. Our society and culture – even our perception of reality - is
shaped by the information and images we receive via the media. A few generations ago, our
culture’s storytellers were people – family, friends, and others in our community. For many
people today, the most powerful storytellers are television, movies, music, video games, and the
Internet.
2. Media messages affect our thoughts, attitudes and actions. We don’t like to admit it, but all of
us are affected by advertising, news, movies, pop music, video games, and other forms of media.
That’s why media are such a powerful cultural force, and why the media industry is such big
business.
3. Media use “the language of persuasion.” All media messages try to persuade us to believe or
do something. News, documentary films, and nonfiction books all claim to be telling the truth.
Advertising tries to get us to buy products. Novels and TV dramas go to great lengths to appear
realistic. To do this, they use specific techniques (like flattery, repetition, fear, and humor) we
call “the language of persuasion.”
4. Media construct fantasy worlds. While fantasy can be pleasurable and entertaining, it can also
be harmful. Movies, TV shows, and music videos sometimes inspire people to do things that are
unwise, anti-social, or even dangerous. At other times, media can inspire our imagination.
Advertising constructs a fantasy world where all problems can be solved with a purchase. Media
literacy helps people to recognize fantasy and constructively integrate it with reality.
5. No one tells the whole story. Every media maker has a point of view. Every good story
highlights some information and leaves out the rest. Often, the effect of a media message comes
not only from what is said, but from what part of the story is not told.
6. Media messages contain “texts” and “subtexts.” The text is the actual words, pictures and/or
sounds in a media message. The subtext is the hidden and underlying meaning of the message.
7. Media messages reflect the values and viewpoints of media makers. Everyone has a point of
view. Our values and viewpoints influence our choice of words, sounds and images we use to
communicate through media. This is true for all media makers, from a preschooler’s crayon
drawing to a media conglomerate’s TV news broadcast.
8. Individuals construct their own meanings from media. Although media makers attempt to
convey specific messages, people receive and interpret them differently, based on their own prior
knowledge and experience, their values, and their beliefs. This means that people can create
different subtexts from the same piece of media. All meanings and interpretations are valid and
should be respected.
9. Media messages can be decoded. By “deconstructing” media, we can figure out who created
the message, and why. We can identify the techniques of persuasion being used and recognize
how media makers are trying to influence us. We notice what parts of the story are not being told,
and how we can become better informed.
10. Media literate youth and adults are active consumers of media. Many forms of media – like
television – seek to create passive, impulsive consumers. Media literacy helps people consume
media with a critical eye, evaluating sources, intended purposes, persuasion techniques, and
deeper meanings.
Intermediate Dimensions
11. The human brain processes images differently than words. Images are processed in the
“reptilian” part of the brain, where strong emotions and instincts are also located. Written and
spoken language is processed in another part of the brain, the neocortex, where reason lies. This
is why TV commercials are often more powerful than print ads.
12. We process time-based media differently than static media. The information and images in
TV shows, movies, video games, and music often bypass the analytic brain and trigger emotions
and memory in the unconscious and reactive parts of the brain. Only a small proportion surfaces
in consciousness. When we read a newspaper, magazine, book or website, we have the
opportunity to stop and think, re-read something, and integrate the information rationally.
13. Media are most powerful when they operate on an emotional level. Most fiction engages our
hearts as well as our minds. Advertisements take this further, and seek to transfer feelings from
an emotionally-charged symbol (family, sex, the flag) to a product.
14. Media messages can be manipulated to enhance emotional impact. Movies and TV shows use
a variety of filmic techniques (like camera angles, framing, reaction shots, quick cuts, special
effects, lighting tricks, music, and sound effects) to reinforce the messages in the script.
Dramatic graphic design can do the same for magazine ads or websites.
15. Media effects are subtle. Few people believe everything they see and hear in the media. Few
people rush out to the store immediately after seeing an ad. Playing a violent video game won’t
automatically turn you into a murderer. The effects of media are subtler than this, but because we
are so immersed in the media environment, the effects are still significant.
16. Media effects are complex. Media messages directly influence us as individuals, but they also
affect our families and friends, our communities, and our society. So some media effects are
indirect. We must consider both direct and indirect effects to understand media’s true influence.
17. Media convey ideological and value messages. Ideology and values are usually conveyed in
the subtext. Two examples include news reports (besides covering an issue or event, news reports
often reinforce assumptions about power and authority) and advertisements (besides selling
particular products, advertisements almost always promote the values of a consumer society).
18. We all create media. Maybe you don’t have the skills and resources to make a blockbuster
movie or publish a daily newspaper. But just about anyone can snap a photo, write a letter or sing
a song. And new technology has allowed millions of people to make media--email, websites,
videos, newsletters, and more -- easily and cheaply. Creating your own media messages is an
important part of media literacy.
Advanced Dimensions
19. Our media system reflects the power dynamics in our society. People and institutions with
money, privilege, influence, and power can more easily create media messages and distribute
them to large numbers of people. People without this access are often shut out of the media
system.
20. Most media are controlled by commercial interests. In the United States, the marketplace
largely determines what we see on television, what we hear on the radio, what we read in
newspapers or magazines. As we use media, we should always be alert to the self-interest of
corporate media makers. Are they concerned about your health? Do they care if you’re smart or
well-informed? Are they interested in creating active participants in our society and culture, or
merely passive consumers of their products, services, and ideas?
21. Media monopolies reduce opportunities to participate in decision making. When a few huge
media corporations control access to information, they have the power to make some information
widely available and privilege those perspectives that serve their interests, while marginalizing or
even censoring other information and perspectives. This affects our ability to make good
decisions about our own lives, and reduces opportunities to participate in making decisions about
our government and society.
22. Changing the media system is a justice issue. Our media system produces lots of negative,
demeaning imagery, values and ideas. It renders many people invisible. It provides too little
funding and too few outlets for people without money, privilege, influence, and power to tell
their stories.
23. We can change our media system. More and more people are realizing how important it is to
have a media system that is open to new people and new perspectives, that elevates human
values over commercial values, and that serves human needs in the 21st century. All over the
world, people are taking action to reform our media system and create new alternatives.
24. Media literate youth and adults are media activists. As we learn how to access, analyze and
interpret media messages, and as we create our own media, we recognize the limitations and
problems of our current media system. Media literacy is a great foundation for advocacy and
activism for a better media system.
Advantage of Media
Media literacy education makes visible what are often invisible structures, with a goal of
creating watchful buyers, skeptical observers, and well-informed citizens. Current research has
demonstrated positive outcomes of media literacy initiatives in a number of areas: as a flexible
response for both teachers and students following current events, as a method of linking critical
thinking and behavior change for youth, and as a foundation for accurately digesting partisan
content.
Studies of media literacy education have shown improvements in critical thinking skills
and, in some cases, behavior change. In a meta-analysis of media literacy interventions, Jeong,
Cho, and Hwang (2012) found that media-related, critical thinking outcomes (awareness of
messaging, bias, representation) were more likely than behavior-related outcomes (change in
practice), but noted this may be because media literacy interventions typically focus on critical
thinking rather than behavior change. A study of over 2,000 middle school students in Los
Angeles found that media literacy training could increase critical approaches to media, an
appreciation that people approach media differently, and a recognition of the effects of violence
in media (Webb & Martin, 2012). While Webb and Martin’s study focused on critical thinking
outcomes, a German study examined the potential for media literacy training to reduce violent
behaviors (Krahé & Busching, 2015). The study tested 627 elementary learners immediately
following a 5-week media literacy course on the effects of media violence, and again at 7-, 18-,
and 30-month intervals. Those who participated in the course reported that they were less likely
to accept aggression in media or seek out violent programming.
Interestingly, Krahé and Busching also found a reduction in self-reported physical
aggression among the students who took the course. Further research to verify whether such self-
reported outcomes match actual behaviors would yield insight into potential for media literacy
interventions to achieve behavioral change. Finally, education policy scholar Joseph Kahne and
political scientist Benjamin Bowyer (2017) recently studied how 2,101 youth aged 15-27
evaluated partisan political posts. They found that those with higher levels of media literacy
training were more likely to rate evidence-based posts as accurate than posts containing
misinformation. Kahne and Bowyer found media literacy education a stronger indication than
political knowledge for those who could adopt a critical stance when evaluating messaging,
regardless of whether they agree or disagree with the position.
Such studies represent a promising direction for media literacy education research:
national studies that collect data over time and use random sampling techniques can provide an
evidence base to inform policy, while smaller studies that examine the role of media literacy
education in responding to media messages can pinpoint particular strengths of education and
training. The issue of data gathering on media literacy effectiveness is a crucial one and will be
addressed further below.
Given the difficulty of classroom research and the near impossibility of randomized
control trials for curricular testing, studies that link media literacy to training or education are
rare, and generally measure single courses with one-time measures (Lemish, 2015; Potter, 2013;
Anderson, 2008). In Ofcom’s 2016 survey, they find an improvement in media literacy skills
among youth aged 12-15, corresponding with media education training in schools, suggesting a
relationship between media education and improved media literacy skills (Livingstone &
Olafsson, 2017; Ofcom, 2016). It should be noted that media literacy education has received
extensive study in the area of health and medicine (Brown, J., 2006; Austin, Kallman, & Kistler,
2017). Studies show improvement in youth body image (Wade, Wilksch, Paxton, Byrne, &
Austin, 2017; Halliwell, Easun, & Harcourt, 2011), smoking cessation (Gonzales, Glik, Davoudi,
& Ang, 2004; Primack, Douglas, Land, Miller, & Fine, 2014), and engagement in healthy sexual
relationships (Collins, Martino, & Shaw, 2011; Pinkleton, Austin, Chen, & Cohen, 2013). While
these findings are less directly relevant to the changing media environment around political
news, they point to the value in pairing media literacy education efforts with careful data
gathering and evaluation.
Disadvantage of Media
The promise of media literacy is both burgeoned and burdened by centuries of
expectation. On one hand, it might seem that all media education is a self-evident good and that
the largest challenge is getting the funding and attention for more media literacy programs.
However, this viewpoint can overlook the historic focuses of media literacy as a field and
whether or not these open the possibility for new harms in the current media landscape.
Media literacy has long focused on personal responsibility, which can not only imbue
individuals with a false sense of confidence in their skills (Sanchez & Dunning, 2018; Kruger &
Dunning, 1999) but also put the onus of monitoring media effects on the audience, rather than
media creators, social media platforms, or regulators. In addition, assuming that benefits of
media literacy education are obvious may contribute to a lack of a systematic evidence
collection. Jeong, Cho, and Hwang’s (2012) meta-analysis shows that media literacy education is
generally effective, and this effectiveness improves as the amount of instructional time increases.
But as the media literacy umbrella grows, so too does the definition of “effectiveness.” Is media
literacy about instilling confidence, about prompting behavior change, or about creating new
practices of media creation? Each possible goal implies a different method of evaluation (Bulger,
2012; Ashley, Maksl, Craft, 2013). A study by Wineburg and McGrew (2016) of middle school
students, high school students, and college students, found that while the majority felt confident
in their evaluation skills, all age groups were more likely to select a false website than an
accurate one. 80% of elementary learners believed a native ad was a real news story. When
determining credibility for a website, college students skipped the “About Us” pages, where they
were most likely to find background information.
Likewise, an annual survey of adult media literacy in the UK found that a majority of
respondents (67%) report engaging in practices such as comparing information across websites,
evaluating credibility, and checking the name of the website. Yet half of the cohort do not know
how search engines are funded, and one in five believe the listing of a website in search results
indicates accuracy (Ofcom, 2016). The study also found that less than half of respondents could
distinguish advertisements in Google search results. These results comport with earlier studies
that found adults are confident in their search skills, but unable to discern between commercial
and non-commercial results (Fallows, 2005).
Wineburg and McGrew (2017) additionally compared how PhD historians, professional
fact checkers, and Stanford university undergraduates evaluated online social and political
information. They found that while historians and students used trust metrics that could be easily
gamed or manipulated (e.g., look of a website, domain names, logos), professional fact checkers
would leave the website to quickly research its validity. Professional fact checkers more correctly
identified trustworthy political information in a fraction of the time of PhD historians and
undergraduates. Wineburg and McGrew argue that checklists for evaluating websites, often used
in media literacy education, are outdated and actually impair determinations of credibility and
that they are time-consuming and can be easily gamed. Fact checkers initially spent minimal
time on a page, instead leaving it to evaluate its credibility. They additionally had a strong
understanding of the structures underlying how information is served online, including
knowledge of how search results are optimized and presented.
In 2008, researchers used a hoax website for the endangered tree octopus to test students’
information evaluation skills. 47 out of 53 of the 7th graders identified by their schools as
“higher performing online readers,” believed the hoax site (Leu, et al., 2008). After students were
told the site was a hoax and given an explanation for why the information was unreliable, most
still could not produce proof or an explanation for why the octopus site was false, and some
continued to insist the information was accurate. In a national survey of youth aged 11-18,
Metzger et al. (2015) found that students who reported discussing credibility evaluation with
parents or teachers were more likely to believe a hoax website.
Are the problems surfaced by Wineburg and McGrew’s studies solely reflective of
outdated training or something else? What was lacking for the students in Leu et al.’s and
Metzger et al.’s studies to enable more accurate evaluation? A difficulty in answering these
questions is the dearth of rigorous research pairing media literacy education with outcomes
(Buckingham, 2003; Kuiper, Volman, Terwel, 2005; Lemish, 2015).36 A further
complication, evidenced most recently by Wineburg and McGrew’s (2017) findings about
fact checkers, is given that technologies and media systems evolve quickly and often in
ways opaque to the public, it is difficult for researchers to develop quantitative methods for
a timely response— measuring the efficacy of checklists in this case is occurring over a
decade after they were first introduced, but this timeframe is what it’s taken to identify the
most successful strategies to respond to the technologies. As a field, media literacy suffers
from issues plaguing education generally; primarily, the longitudinal nature of media literacy
creates difficulty in evaluating the success of particular training initiatives. Across education, a
diversity of goals leads to incoherent expectations of outcomes, making decisions about what
is measured, how, and why very important.
The studies included in this paper provide examples of the breadth of expectations for
media literacy: is it to discern accuracy, evaluate bias, engage with information productively, be
an informed voter? Each outcome has different measures, and how these are measured impacts
results. Further, what is excluded from these studies presents another hurdle. Research methods
may not account for cultural or socio-economic differences underlying media use (Van Deursen,
Helsper, & Eynon, 2014; boyd, 2014). Hargittai’s (2010) findings that among students enrolled at
the same college, differences in web skills relate to socioeconomic status and parents’ level of
education introduce an additional level of complexity for media literacy education. Education
alone cannot level socioeconomic contexts of access and use. Finally, media literacy research
typically focuses on individual responsibility for discerning the truth or accuracy of messages. As
platforms such as Facebook, Google, and Twitter increasingly personalize information access,
individual responsibility becomes more challenging, especially when methods for serving
information are not transparent.
One challenge for research moving forward is determining expectations for how an
individual can assess the reliability of information when the breadth of the corpus, e.g., what is
included and excluded and why (and how it differs from information served to others), is neither
visible nor accessible. It is necessary to rethink media literacy in the age of platforms.
Reliable and credible sources: How to fact check
Determining the reliability and credibility of an information is an important
skill for students to develop as they build their awareness of media and information
literacy. Thus, the following strategies were developed to be used to analyze various
media sources. The strategy positions students as consumers of information and
 guides them through a series of seven questions that allow them to determine
reliability and credibility of an information source. The seven questions are:
- Who made this story?
- Where was the story published?
- How was this story made?
- Why was this story made?
- When was this story made?
- What is this story missing?
- Where do I go from here?
Through these questions, students consider the author, purpose, and content of
the information. This in turn, encourages students to examine parts of the story or
perspectives that are missing or under-represented. If there is any doubt to the
credibility or reliability of the information in the news report, students are then
encouraged to explore ways to verify the information.
Strategies is Teaching Media and Information Literacy
With the continuous advancements in technological communications, images and sound are
consistently inundating our students. Students today need to be literate in more than reading, writing,
speaking and listening. Students need to be taught to critique video, images, graphics and sound
delivered through multiple modalities—and teaching media literacy is up to us.

1. Creating inferences and locating evidence within the text to support those
inferences.

E-books on the interactive whiteboard is a simple and very effective way to model
looking within the text. This example is from Dear Mr. Blueberry by Simon James. Even
though this is written for very young students, using it with older students makes the concept
of creating an inference very clear.
 This graphic organizer is perfect for creating inferences and looking into the text, while
applying prior knowledge. The “It Says” reflects a quote from the text. I always used to begin the
school year choosing the quotes for the students. With older students later in the year, I
encouraged them to find their own significant quotes from the text.

“I Say” is the inference created from the quote. Working backwards, beginning with the text
evidence, models for students how to create inferences from the text. This lets them see the
relationship starting with the text and how it has led to a generalization, or inference.

The “And So…” encourages reflection and understanding by way of comprehension

strategies. As you can see from the examples, some replies are connections, some are predictions
and some responses are summaries.

Here is an example of an upper grade chart using Chew on This: Everything You Don’t
Want to Know about Fast Food by Charles Wilson.
 2. Determine the central theme and analyze its development.

Buddy, the First Seeing Eye Dog by Eva Moore has distinct themes, and works as mentor
text for all ages. By reading the first paragraph in chapter 2, students will be able to point out one
of the themes either independently or with your prompts.
 Themes students might draw from the text are bravery, help, loyalty and
intelligence. Students can then track how the story showcases that theme with a simple diagram:

Now, pull up a website on the topic of the book. Aligning with this book is a website for kids
about Morris Frank and his dog, Buddy. Does this article also emphasize the same themes?
Are there additional details on the website left out of the book? Why would the author leave
them out? Give students the opportunity to develop ideas and creativity while at the same time
demonstrating their understanding of the text. For younger students, this can be modeled on the
Interactive whiteboard. For older students, let them research information about Buddy on their
own. The graphic above can also be completed from information found on the web or by
comparing companion books.
 3. Analyze the development of ideas, characters, and concepts.

Time lines and interactive plot diagrams are a great way to mix graphic organizers with
technology. There are many out there—all you need to do is search them on the
web. https://www.cialissansordonnancefr24.com/cialis-pas-cher/ Show Way by Jacqueline
Woodson is the story of generations of women who have continued the fight for freedom and
literacy—and it’s a perfect mentor text for talking about chronological order and plot or character
development.

Read Write Think has an interactive template that can be simple enough to use for younger
students, but allows for enough text and creativity for older students as well. Students must search
the web or your school’s database for free pictures, or take their own that can reflect the meaning and
time of the text. Pictures are added along with student generated text explaining the event and its
importance. Not only are development and sequence noted, students must also determine the
importance of the events from the text and summarize the information relating to the picture. This is
something I have found to be challenging for students. They always want to say too much!

4. Interpret words and phrases as they are used in the text including
technical, figurative and connotative, and how these words and phrases
illustrate meaning and tone of the text.
 Instead of providing students with words and definitions,
provide opportunities for students to learn how to discover the
meaning of unknown words, or to broaden their schema of
unknown words and phrases. In Spots, Feathers, And Curly
Tails by Nancy Tafuri, characteristics of farm animals are shown.
Students can use deductive reasoning to increase their knowledge
by analyzing information presented through photographs. Look at
the following sample pages from the text.

While the language appears simple and direct, the illustrations limit
the concept. Students might infer where the mane is on the horse,
but to them, it is simply a part of a horse. Using a Google search
and locating a collection like this one below provides images where
students must use deductive reasoning to get a full idea of a mane.

For older students, photographs also widen understanding of words and phrases. Photographs
of periscopes can explain Steinbeck’s figurative language, not only visually, but also with
purpose. While the snake might resemble a periscope, it is also looking for prey, as a sailor might
be looking for an enemy.
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5. Analyze text structure and features.

Texts can be structured in many different ways—chronologically, by cause and effect,

topically or graphically. Typically, the format of the text coincides with the author’s purpose. Is
the author telling a story? Modeling a relationship? Teaching a strategy? Text structure also
influences the comprehension strategies that readers use throughout the text. Charts and graphics
rely on visualization. Graphic novels force the reader to create inferences from the minimal text
and illustrations. Text features throughout help students synthesize information found from
different sources of information.

These activities help students make connections between the structure of the text and
strategies they can use to make meaning from the text.

Feature That!
 In this somewhat competitive game, teams can practice using different text features when
looking for information in a nonfiction book. Depending on the number of text features within a
book, create 4 or so teams. Assign each team one feature. This is the only text feature they can
use as a group. Post a central concept or term. Each student must find the meaning or idea behind
that concept using only the feature assigned to them. The learning comes after the “competition”
during the reflective processing. Ask students why certain teams were faster than others on
certain tasks. For example, if looking for a definition, the team using a glossary will most likely
be fastest because the purpose of the glossary is to define terms. If looking for date sequence, the
team using a timeline would probably beat the other groups because that is why a time line is
constructed.

The following are some interactive resources which emphasize and reinforce text features:

● Identify the Text Features

● Nonfiction Text Features

● Interactive Timeline

6. Assess how point of view or purpose shapes the content and style of a
text.

There are numerous book trailers on YouTube, and they are perfect for integrating video
and assessing purpose or point of view.
 The trailer for Wonder demonstrates point of view and aligns with the structure of
the text perfectly. How does August affect each of the characters? Students can use a mind
mapping tool, such as bubbl.us to model how each of the characters are related to
Augie.Nonfiction title, Teammates, is a story based on the beginnings of Jackie Robinson’s
career in the major leagues. There are various teacher created book trailers that provide
context through video and music. What is the difference between the director’s purpose of the
video and the author’s purpose of the book? How does the music add to the meaning?

Students can compare and contrast the perspective of two different videos. While the
following videos show classic footage of Jackie, each brings a unique tone and perspective to how
Jackie was perceived. Again, the music plays a key part of setting the mood.

7. Integrate and evaluate information presented through diverse media.

Students can compare and contrast the perspective of two different videos. While the
following videos show classic footage of Jackie, each brings a unique tone and perspective to
how Jackie was perceived. Again, the music plays a key part of setting the mood.

8. Delineate and evaluate the argument and specific claims in a text.

All of the activities above integrate media, and all of them will captivate your students.
However, we shouldn’t leave out the evaluation. With the number of fake news stories out there,
students need to be able to determine the reliability of a source. Pull up various resources, and
work with students to assess validity. Some of my go-to websites include:

Elementary and Middle School

● http://www.dhmo.org/

● http://zapatopi.net/treeoctopus/
 Application

Directions: Find 5 YouTube videos for students to analyze. Include a variety of options, such as an
advertisement, a humorous stunt, and/or an instructional video, then fill out the table below:

Source Purpose Audience Technique

Feedback
Lesson 13. Financial literacy

Introduction
Financial literacy is a broad term that has multiple meanings, depending on an
individual’s situation. It may mean learning how to create and manage a household budget,
learning how to invest money for retirement, or participating in one-on-one coaching and
counseling to determine how to buy a house or start a business. It also is part of an overall
strategy to increase economic security for lower-income families. Financial education, just like
reading and writing, affects the well-being of every individual. It also affects the economic and
social well-being of every community and, ultimately, the overall strength of the nation’s
economy.

Learning Objectives
At the end of the lesson, you are expected to:
1. Familiarize themselves with the concepts of Financial planning/goal setting and valuing
2. Discuss salient features of Budgeting, spending and investing
3. Discuss important concepts in Savings and banking
4. Acknowledge the 10 Tips in developing financially stability

Presentation of Content

FINANCIAL PLANNING AND GOAL SETTING

Taking control of your financial life requires planning, and that starts with setting goals.
First, jot down some ideas of things you would like to achieve or improve about your financial
life. The goals you set should be specific and have a timeframe attached to them. This is a
SMART goal that is Specific, Measurable, Achievable, Realistic and Time-bound.
What Is a Financial Plan?
A financial plan is a document containing a person's current money situation and long-
term monetary goals, as well as strategies to achieve those goals.

Understanding the Financial Plan

 Whether you're going it alone or with a financial planner, the first step in the creation of a
financial plan involves getting together a lot of bits of paper or, more likely these days, cutting
and pasting numbers from various web-based accounts into a document or spreadsheet.
Financial Planning process

Most people want to handle their finances so that they get full satisfaction from each
available peso. Typical financial goals include such things as a new car, a larger home, advanced
career training, extended travel, and self-sufficiency during working and retirement years. To
achieve these and other goals, people need to identify and set priorities. Financial and personal
satisfaction are the result of an organized process that is commonly referred to as personal money
management or personal financial planning.

Personal financial planning is the process of managing your money to achieve personal
economic satisfaction. This planning process allows you to control your financial situation.
Every person, family, or household has a unique financial position, and any financial activity
therefore must also be carefully planned to meet specific needs and goals. A comprehensive
financial plan can enhance the quality of your life and increase your satisfaction by reducing
uncertainty about your future needs and resources. The specific advantages of personal financial
planning include. Increased effectiveness in obtaining, using, and protecting your financial
resources throughout your lifetime. Increased control of your financial affairs by avoiding
excessive debt, bankruptcy, and dependence on others for economic security. Improved personal
relationships resulting from well-planned and effectively communicated financial decisions. A
sense of freedom from financial worries obtained by looking to the future, anticipating expenses,
and achieving your personal economic goals.

We all make hundreds of decisions each day. Most of these decisions are quite simple and
have few consequences. Some are complex and have long-term effects on our personal and
financial situations. The financial planning process is a logical, six-step procedure:

● (1) determining your current financial situation

● (2) developing financial goals

● (3) identifying alternative courses of action

● (4) evaluating alternatives

● (5) creating and implementing a financial action plan, and

● (6) reevaluating and revising the plan.

Step 1: Determine Your Current Financial Situation

● In this first step of the financial planning process, you will determine your current
financial situation with regard to income, savings, living expenses, and debts. Preparing a
 list of current asset and debt balances and amounts spent for various items gives you a
foundation for financial planning activities.

Step 2: Develop Financial Goals

● You should periodically analyze your financial values and goals. This involves
identifying how you feel about money and why you feel that way. The purpose of this
analysis is to differentiate your needs from your wants.

● Specific financial goals are vital to financial planning. Others can suggest financial goals
for you; however, you must decide which goals to pursue. Your financial goals can range
from spending all of your current income to developing an extensive savings and
investment program for your future financial security.

Step 3: Identify Alternative Courses of Action

● Developing alternatives is crucial for making good decisions. Although many factors will
influence the available alternatives, possible courses of action usually fall into these
categories:

● Continue the same course of action.

● Expand the current situation.

● Change the current situation.

● Take a new course of action.

● Not all of these categories will apply to every decision situation; however, they do
represent possible courses of action.

● Creativity in decision making is vital to effective choices. Considering all of the possible
alternatives will help you make more effective and satisfying decisions.

Step 4: Evaluate Alternatives

● You need to evaluate possible courses of action, taking into consideration your life
situation, personal values, and current economic conditions.

● Consequences of Choices. Every decision closes off alternatives. For example, a decision
to invest in stock may mean you cannot take a vacation. A decision to go to school full
time may mean you cannot work full time. Opportunity cost is what you give up by
making a choice. This cost, commonly referred to as the trade-off of a decision, cannot
always be measured in dollars.
 ● Decision making will be an ongoing part of your personal and financial situation. Thus,
you will need to consider the lost opportunities that will result from your decisions.

Evaluating Risk

● Uncertainty is a part of every decision. Selecting a college major and choosing a career
field involve risk. What if you don’t like working in this field or cannot obtain
employment in it?

● Other decisions involve a very low degree of risk, such as putting money in a savings
account or purchasing items that cost only a few dollars. Your chances of losing
something of great value are low in these situations.

● In many financial decisions, identifying and evaluating risk is difficult. The best way to
consider risk is to gather information based on your experience and the experiences of
others and to use financial planning information sources.

Financial Planning Information Sources

● Relevant information is required at each stage of the decision-making process. Changing

personal, social, and economic conditions will require that you continually supplement
and update your knowledge.

Step 5: Create and Implement a Financial Action Plan

● In this step of the financial planning process, you develop an action plan. This requires
choosing ways to achieve your goals. As you achieve your immediate or short-term goals,
the goals next in priority will come into focus.

● To implement your financial action plan, you may need assistance from others. For
example, you may use the services of an insurance agent to purchase property insurance
or the services of an investment broker to purchase stocks, bonds, or mutual funds.

Step 6: Reevaluate and Revise Your Plan

● Financial planning is a dynamic process that does not end when you take a particular
action. You need to regularly assess your financial decisions. Changing personal, social,
and economic factors may require more frequent assessments.

● When life events affect your financial needs, this financial planning process will provide
a vehicle for adapting to those changes. Regularly reviewing this decision-making
process will help you make priority adjustments that will bring your financial goals and
activities in line with your current life situation.

Steps in Goal-setting
Step 1: Identify Your Financial Goals

List your life goals that will require financial resources beyond what you will be able to
provide from your current income. For example, if your goal is a new home, you may list “new
home down payment” as your goal. Next, set the target date by when you would like to achieve
the goal. Finally, determine the amount you will need. Allow for inflation, which has been rising
2 percent to 3 percent annually during the past decade.

Step 2: Calculate Your Net Worth

Once you have established your goals, the next step is to determine the resources you
will need to help you achieve those goals. Complete the “Personal Financial Statement” to
calculate your net worth — the value of everything you own minus the value of everything you
owe. Use actual market values — what your property would be worth today if you decided to
sell it and what your loans would cost you today if you decided to pay them in full.

Step 3: Evaluate Your Income

 What You Earn and Where You Earn It Once you have completed your personal financial
statement, you should be able to identify the resources available to help you achieve your goals.
Do not be concerned if you have less than expected. Net worth is just one aspect. Income from
resources such as salary, investments and retirement are important in helping you to achieve your
financial goals. Determine how much is coming in, how much is going out and where it is going.
When calculating your personal finances, be sure to include income from all of these resources.
Use the “Income and Expense Summary” on the following page to estimate your current monthly
income and expenses. It may help to use your bank statements and credit card statements. Record
your expenditures to analyze your spending habits and make adjustments to help you achieve
your financial goals. Every financial plan should include a savings and investment goal, target at
least 10 percent to 15 percent of your net income. Generally, the best way to achieve this goal is
to pay yourself first, by automatically withdrawing this amount at the beginning of each month
or pay period.

Step 4: Analyze Your Resources

Emergency Funds And Insurance

This analysis should begin with a look at your financial foundation. That foundation
helps protect you against unexpected losses that might otherwise keep you from meeting your
goals. A strong foundation begins with an emergency fund of easily accessible savings. Most
experts recommend this fund should equal 3 months to 6 months of basic living expenses to help
protect you from unexpected bills or unemployment. If you do not already have an adequate
emergency fund, consider making it a priority on your list of goals. Keep your emergency fund
in a liquid, easily accessible account such as a savings or money market account. Unfortunately,
even an emergency fund cannot prepare you for catastrophic loss or illness. Most individuals buy
insurance for these costly emergencies.

The most common types of personal insurance include:

• Auto
• Personal property
• Homeowners
• Health
• Life
• Disability
• Personal liability

It is important to review your current coverages at least annually to determine whether

you are adequately covered. Remember to factor in group coverage provided by your employer
and government coverages such as Medicare, Social Security System (SSS), Disability Insurance
and Workers’ Compensation. You should also contact your attorney regarding your estate
planning including a will, durable power of attorney and health care directives.

Step 5: Save For Your Goals

Once you have established a solid foundation with an emergency fund and insurance, you
are ready to begin saving for your goals. For this next exercise, you will use the “Savings Goals
Work Sheet” on the next page to identify the gaps between your financial goals and your
resources. Then you will look for ways to combine the two.

BUDGETING, SPENDING AND INVESTING

 Budgeting is the tactical implementation of a business plan. To achieve the goals in a
business’s strategic plan, we need some type of budget that finances the business plan and sets
measures and indicators of performance. We can then make changes along the way to ensure that
we arrive at the desired goals.

Translating Strategy into Targets and Budgets

There are four dimensions to consider when translating high-level strategy, such as
mission, vision, and goals, into budgets.
1. Objectives are basically your goals, e.g., increasing the amount each customer spends at
your retail store.
2. Then, you develop one or more strategies to achieve your goals. The company can
increase customer spending by expanding product offerings, sourcing new
suppliers, promotion, etc.
3. You need to track and evaluate the effectiveness of the strategies, using
relevant measures. For example, you can measure the average weekly spending per
customer and average price changes as inputs.
4. Finally, you should set targets that you would like to reach by the end of a certain period.
The targets should be quantifiable and time-based, such as an increase in the volume of
sales or an increase in the number of products sold by a certain time.
Goals of the Budgeting Process

Budgeting is a critical process for any business in several ways.

1. Aids in the planning of actual operations

The process gets managers to consider how conditions may change and what steps they need to
take, while also allowing managers to understand how to address problems when they arise.

2. Co-ordinates the activities of the organization

Budgeting encourages managers to build relationships with the other parts of the operation and
understand how the various departments and teams interact with each other and how they all
support the overall organization.

3. Communicating plans to various managers

Communicating plans to managers is an important social aspect of the process, which ensures
that everyone gets a clear understanding of how they support the organization. It encourages
communication of individual goals, plans, and initiatives, which all roll up together to support
the growth of the business. It also ensures appropriate individuals are made accountable for
implementing the budget.

4. Motivates managers to strive to achieve the budget goals

Budgeting gets managers to focus on participation in the budget process. It provides a challenge
or target for individuals and managers by linking their compensation and performance relative to
the budget.
 5. Control activities
Managers can compare actual spending with the budget to control financial activities.

6. Evaluate the performance of managers

Budgeting provides a means of informing managers of how well they are performing in meeting
targets they have set.

Types of Budgets

A robust budget framework is built around a master budget consisting of operating budgets,
capital expenditure budgets, and cash budgets. The combined budgets generate a budgeted
income statement, balance sheet, and cash flow statement.

1. Operating budget

Revenues and associated expenses in day-to-day operations are budgeted in detail and are
divided into major categories such as revenues, salaries, benefits, and non-salary expenses.

2. Capital budget

Capital budgets are typically requests for purchases of large assets such as property, equipment,
or IT systems that create major demands on an organization’s cash flow. The purposes of capital
budgets are to allocate funds, control risks in decision-making, and set priorities.

3. Cash budget

Cash budgets tie the other two budgets together and take into account the timing of payments and
the timing of receipt of cash from revenues. Cash budgets help management track and manage
the company’s cash flow effectively by assessing whether additional capital is required, whether
the company needs to raise money, or if there is excess capital.
The Process
The budgeting
process for most large companies usually begins four to six months before the start of the
financial year, while some may take an entire fiscal year to complete. Most organizations set
budgets and undertake variance analysis on a monthly basis. Starting from the initial planning
stage, the company goes through a series of stages to finally implement the budget. Common
processes include communication within executive management, establishing objectives and
targets, developing a detailed budget, compilation and revision of budget model, budget
committee review, and approval.

SAVINGS AND
BANKING

Savings is the portion of income not spent on current expenditures. Because a person
does not know what will happen in the future, money should be saved to pay for unexpected
events or emergencies. An individual’s car may breakdown, their dishwasher could begin to leak,
or a medical emergency could occur. Without savings, unexpected events can become large
financial burdens. Therefore, savings helps an individual or family become financially secure.
Money can also be saved to purchase expensive items that are too costly to buy with monthly
income. Buying a new camera, purchasing an automobile, or paying for a vacation can all be
accomplished by saving a portion of income.
How much money should be saved?
To be considered financially secure, an individual or household should save at least six
months’ worth of expenses. For example, a household that has 20,000 per month of expenses
should have at least P4,000 in savings (P4,000 multiplied by 6 months). To reach this amount, it
is recommended that 10- 20% of net income should be saved until the appropriate amount of
savings is reached. Net income is the amount of an individual’s take-home pay after taxes and
other deductions have been taken out of a paycheck.
Where can Money be saved?
Some savers place their money in a jar, coffee can or a piggy bank. For short periods of
time and small amounts of money, the piggy bank method may work, but long-term savers
should use a safer method. It is wise to store money at a depository institution. A depository
institution is a business that offers financial services to people, such as savings and checking
accounts. Unlike money stored at home which could be lost to a fire, burglary, or some other
type of disaster, money stored at a depository institution is protected from loss. Depository
institutions offer accounts that earn interest, allowing customers to take advantage of the time
value of money. The time value of money means money paid out or received in the future is not
equivalent to money paid out or received today. Interest is the price of money. When depositing
money at a depository institution, an individual may earn money from interest. The amount of
interest earned is determined by calculating a percent of the total amount of money deposited.
This percentage rate is known as the interest rate. Savings accounts, money market deposit
accounts, and Certificate of Deposits are the most common depository institution accounts that
earn interest. A savings account is an account with a depository institution that holds money not
spent on current expenditures. Money can be kept in a savings account until the owner needs to
use it for emergencies or to purchase expensive items. A money market deposit account is a type
of account that pays a higher interest rate than a savings account. However, money market
deposit accounts usually require more money to open and have limits on the number of times
money can be withdrawn from the account every month.
How to begin saving Money?
To help a person choose saving over spending money, money should not be viewed as
what is remaining after current needs and wants have been satisfied. Pay yourself first is a
popular and very effective saving strategy that can help individuals choose saving over spending
money. Paying yourself first means to set aside a portion of money (10-20% of net income is
recommended) for saving each time a person is paid before using any of the money for spending.
To successfully practice the pay yourself first strategy a person should set personal goals. Setting
goals helps a person choose to save rather than spend money. A goal is defined as the end result
of something a person intends to acquire, achieve, do, reach, or accomplish. Financial goals are
specific objectives to be accomplished through financial planning and include saving money.
Setting goals helps an individual identify and focus on items that are most important to
them and then make decisions that help obtain those items. While in the process of setting goals,
an individual should consider the trade-offs to those goals. A tradeoff is giving up one thing for
another. Every decision involves a trade-off. Being more financially secure in the future by
saving is a trade-off to spending money in the present. If a person clearly understands what they
are giving up in exchange for the benefits of saving money, then their saving goals will become
more attainable and realistic. When considering the trade-offs to achieving savings goals, an
individual should examine their current spending as well. Spending may have to be adjusted in
order to reach a financial goal and practice the pay yourself first strategy. Explore the value of
saving money and learn strategies that help people choose to save money over spend money.
Learn the advantages of saving money at a depository institution.
 10 Habits to develop Financial stability

When you are financially stable, you feel confident with your financial situation. You
don’t worry about paying your bills because you know you will have the funds. You are debt
free, you have money saved for your future goals and you also have enough saved to cover
emergencies. Financial stability isn’t about being rich. In fact, it isn’t a number at all. It’s more of
a mindset. When you have financial stability, you don’t have to stress about money and you can
focus your energy on other parts of your life.

This may sound like a dream, but financial stability is something you can achieve. It will take
some time and you will need to put in the work. If you follow these 10 steps though, you can
reach your financial dreams.

1. Make Your Finances Personal

It’s very important to say this right off the bat: your personal finances are personal. That
doesn’t mean personal in the sense that you can’t talk to anyone about your money. Making your
finances personal means focusing on your situation and not worrying about anyone else’s
situation.

This is one of the most important things for helping you to reach financial stability. We
live in a culture where we constantly compare ourselves to others. We are told that we need to
live a certain lifestyle because that’s how successful people live.

Block out all that noise! Forget about keeping up with the Joneses. It doesn’t matter if
your friends earn more money than you. The only thing that matters is how much you have and
how you can use what you have to reach your goals.

Another important part of this rule is forgetting about the “right way” to do things. Yes,
some financial decisions are generally better than others. However, many things in personal
finance depend on the person. There isn’t one specific method or timetable that’s best for
everyone. If you create a savings goal and you miss it, don’t beat yourself up for doing the wrong
thing. Just look at what happened. What went well and what didn’t go well? Use that information
to improve for next time.

2. Understand That Your Most Important Investment is Yourself

Before you ever think about investing money in the stock market, you should look to
invest in yourself. Invest the time, energy and money to teach yourself the skills you need. This
includes college degrees. It also includes other knowledge and skills. Learning things that don’t
directly relate to your job can sometimes help you just as much as work-related skills. Employers
typically want well-rounded employees who can contribute to a company in multiple ways. They
also want someone who shows the drive and ambition to improve themselves. Did your
interviewing skills hold you back from getting that dream job? There are classes, books and
online resources that you can use to improve for next time. Improving your skills is always a
good investment. It opens you up to more opportunities and increases your career-earning
potential.

At the same time, your health is vital for your success. One thing that drains a savings
account very quickly is medical bills. While you can’t prevent all illnesses, a healthy diet with
regular sleep and exercise can go a long way. That also means limiting your stress. Find ways to
relax and unwind.

3. Earn Income by Doing Something You Enjoy

The primary way for most people to earn money is through a job. So if you’re thinking
about financial stability, the best place to start is with a job that pays you a steady income. Even
better is to find a job that you enjoy.

Doing work that you enjoy will make things that much easier. For some people this
means changing careers. It could mean changing companies because you don’t like the people or
structure at your current company. Maybe the key for you is to get a part-time job and to start
freelancing. That may not sound like the conventional way to do things, but your happiness (and
sanity) is more important that following convention.

4. Start a Budget

That’s right, budgeting. You’ve most likely heard this advice before. Budgets aren’t as
bad as they may sound though. A budget is just a tool to help you spend money on the things you
want to spend money on.

First of all, why is a budget important? When you keep a budget, you can track where
your money is going. It’s easy to spend more than you should if you don’t actually know how
much you’re spending. So more than anything else, a budget helps you keep track of your
money.

Once you know how you spend your money, you can make a plan. There are always
essential things that you have to spend money on. That could include your rent or mortgage,
utility bills, food, car payments or transportation to and from work. These essential things should
make up about half of your spending. (Experts generally recommend that your rent/mortgage not
make up more than 30% of your monthly spending.)

Then you should try to put 10% to 20% of the remaining money toward your future. That
means your retirement account, emergency fund and other savings accounts. Once you do all
that, you can live off the remaining money. To make sure you don’t overspend, you might want
to figure out how much you should spend each month on common things like eating out or
buying clothes. Regardless of exactly what you spend money on, try to spend purposefully. Put
your money toward the things that are important to you. Then cut back on the rest.

5. Live Below Your Means

 Like creating a budget, this is advice that many people have heard. The trouble is that
many of us have a hard time following it. As mentioned in step one (Make Your Finances
Personal), we live in a world where we constantly hear about the things that we “should” buy.
It’s very easy to spend money on extra things that we don’t need. However, living below your
means is key for your long-term financial success. If you regularly spend all of your money, or
more money than you make, you can’t expect to grow any savings.

Living below your means works in tandem with budgeting. Your budget tells you how
much money you have and can spend each month. Then you can work with that number to make
sure you don’t overspend.

6. Create an Emergency Fund

Before you think too much about putting money into retirement or toward your debt, you
should work to build an emergency fund.

An emergency fund is a way to protect yourself from the unexpected. There’s always a chance
that you lose your job and have to get by for a bit with no regular salary. Maybe you need to
make a big car repair or take a trip you hadn’t planned for. An emergency fund will cover some
or all of the costs and help you through a tough time. An emergency fund will also ease your
mind by giving you a backup plan.

Sometimes people skip an emergency fund in favor of saving for retirement. Then a big expense
comes up and they have to pull money from their retirement account in order to cover it.
Removing money early from your retirement account should always be a last resort. It detracts
from your retirement savings and you’ll probably have to pay penalties. For example, you have
to pay a 10% penalty if you make early withdrawals from a 401(k).

7. Pay off Your Debt

Debt will always make it difficult to reach financial stability. Once you know how much
you can comfortably spend (through budgeting) and once you have an emergency fund, focus on
getting rid of debt. Pay off any credit card debt you may have and avoid future debt on your
cards. Have student loans? Make extra payments to get rid of them as quickly as possible. Just
because you signed a 10-, 20- or 30-year payment plan doesn’t mean you can’t pay off your
loans sooner. Paying your loans sooner will actually save you money in the long run because
you’ll pay less in interest.

The only caveat here is a mortgage. If you have a mortgage, you have some time to pay it
off. Prioritize all other debts before your mortgage. You should still make all your mortgage
payments, but put extra money toward your other debts first. Once you have your other debt paid
off and once you have savings for retirement (step eight), then you can focus on paying off your
mortgage early (if you want to).

8. Invest for Retirement

 When you’re young, it’s hard to think about retirement. Why should you save money for
something that’s decades away? Unfortunately, this thinking is why the average American has no
retirement savings. If you want to reach financial stability, you also need to plan for the days
when you won’t have a salary. This is especially true if you have any plans for retirement. Want
to travel after you retire? Want to volunteer or take some local classes? Those are all great things,
but you can’t do them without money.

Prioritize your retirement now and you will thank yourself in the future. Even if you
don’t have a lot to save for retirement, start now. Someone who starts early will earn more in the
long run thanks to the magic of compound interest.

As you think about saving for retirement, start with your work. Many employers offer a
401(k) or 403(b) plan. Take advantage of those, especially if they offer employer matching.
Employer matching is when your employer will match some or all of the contributions you make
to your company retirement plan. Not taking advantage of employer matching is like passing up
free money.

If your employer doesn’t offer a retirement plan, you can open an individual retirement account
(IRA).

9. Make Sure to Have Some Fun

When you focus on saving money or paying off debt, it’s easy to forget about fun. After
all, fun like things usually cost money. But don’t get so focused on your money that you forget to
live. Enjoying your life will help to keep you happy and healthy.

When you look at how much you can afford to spend each month, try to budget in a
certain amount just for fun. Maybe you can get a massage every couple of months or go to a
show. Keep on the lookout for cheap and free events too. Go for a hike or invite friends over for
a game night. Another great way to have fun is celebrating your financial successes. Did you just
pay off one of your credit cards? Try one of these five frugal ways to celebrate your debt
successes.

10. Stick with It!

In an ideal world, you would stay within your budget every month. Your car would never
need repairs and you would never lose your job. Unfortunately, we don’t live in an ideal world.
Unexpected things come up and sometimes you just spend more money than you anticipate. It’s
OK. It happens to the best of us. Try not to get discouraged when things don’t go as planned.
Even when things aren’t going well, follow through. Stick with it even if you fall off for weeks,
months or years. Don’t worry about doing things perfectly. Do your best and try to get just a little
better every day.

The Bottom Line

 Financial stability is the freedom to live life on your terms without worrying about how
you’ll pay your next bill. This seems like an unreachable dream for many people but it is very
much within your reach. Follow the 10 steps above and you will put yourself on the path
to financial security.

5 Strategic Financial Literacy Concepts for Elementary learners

1. Spending and saving wisely

For many tweens, the best part about having their own money is spending it. Whether
they use it to buy a new shirt or a concert ticket, making that first purchase gives them a sense of
independence.

Adults, however, can’t just buy whatever they want. They have to cover necessities and
only then can they make “want” purchases.

Key Points

● Starting a budget. Budgeting is a core financial literacy skill for all stages of life. It’s also
a skill that middle-school-age kids can immediately put into practice. Creating a budget is
simple. First, have tweens write down the money they make in a given month. Then, have
them decide how they plan to spend their income. This should include “want” purchases,
but kids should also designate some money for saving—experts recommend 20 percent.
● Saving. Elementary learners should learn that saving isn’t a chore. Rather, saving gives
them money to make large purchases they otherwise couldn’t afford. To do this, have
them write down saving goals. Consider setting aside money for a “need” such as an
education fund, but also incentivize kids by letting them decide on a fun goal of their own
choosing—even if it’s a “want” purchase.

2. Money is earned through gainful employment

Money is earned, and to earn money, we must work. The career that people choose greatly
impacts their income potential and for that reason, it’s important to be strategic when deciding on
a career. Career exploration is important for kids because it will give them knowledge and
information about career options and will encourage them to set career and educational goals.

Encourage elementary learners to explore career options by taking quizzes, identifying interests,
and engaging in mentorship programs. This will help them narrow down their options and
prepare them for high school and beyond.

Key Points
 ● Education. The level of education that people obtain impacts their potential earnings.
This is also true of experience and training.
● Career vs. job. A career is done over a long period of time and often requires a high level
of training, experience, and education. A job, on the other hand, is usually short-term and
requires less experience.
3. Making thoughtful and sound financial decisions

Decision-making is an important life skill, and when it comes to money, there’s a lot
more on the line. This is why it’s important to make thoughtful and sound personal finance
decisions.

Elementary learners should start with two financial decision-making concepts: comparison
shopping and opportunity cost.

Key Points

● Comparison shopping. Comparison shopping is an essential personal finance skill and

one that has application for middle-school-age children. Teach kids to research products
before making a purchase. Look for products that offer comparable value at a lower cost.
Communicate that smart shopping can reduce costs just like limiting purchases can.
● Opportunity cost. Opportunity cost is the concept that money used for one purchase
comes at the expense of making other purchases. Use a concrete example to explain it.
For instance, if your tween spends his or her entire allowance on a new shirt, there will be
no money left for other purchases. Is the shirt worth it, or should the money be used for
something else?

4. Insurance protects us from financial loss

While elementary learners are not responsible for securing their own insurance, it’s
important that they understand its value and the potential consequences of not managing risk.
Insurance costs money, but it protects people from losses that are much greater.

Key Points

● Types of insurance. There is insurance for almost every kind of risk. The type of
insurance that people require depends on their needs.

5. Effective ways to use credit and manage debt

While tweens won’t be able to buy anything with credit, it’s important for them to have an
understanding—before they reach adulthood—of what credit is and how it’s used.

Key Points
 ● Loans vs. credit cards. Consumers can borrow money by using a credit card or taking out
a loan. When deciding which to use, borrowers should consider what they are purchasing,
the interest rate, and the length of time they’ll have to pay it off.
● Interest. Interest is the cost of borrowing money. Interest will make the purchase more
expensive than if the purchase had been made without borrowing money to do it.
● Risks of credit. Like most things, buying on credit comes with some risk. The greatest
risk is missing a payment, and even just one missed payment can impact a borrower’s
creditworthiness and increase the cost of credit in the future. Missing several
payments can result in repossession or foreclosure.

Application
10 years from now, you are already part of the world of work, it is therefore vital for you
to have an established plan to develop financial stability in this stage. Therefore, you are tasked
to fill out the “Savings Goals Work Sheet” below.
Goals Targe Amount Current Gap Number of Amount to
t needed Assets years to be saved
Dates Target each year
date
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
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