From WSJ:

In 2015, we posted research indicating that 47% of Americans couldn’t come up with $400 in case of an emergency. These charts and data tables provide some additional context around that statistic. Questions for your students:

• The pie chart indicates that 2/3 of households have roughly the same income from month to month. What might be some of the reasons why 1/3 of households have less predictable income streams?
• In the second chart, 25% of households with incomes less than $25,000 could come up with $400 in cash in case of an emergency which may not be so surprising as it is hard to save when income levels are low. How would you explain why 25% of those earning over $100,000 could not come up with the cash in case of a $400 emergency?
• In the third set of data, 31% of respondents said if they couldn’t come up with $400, they “wouldn’t be able to pay for the expense right now.” What might be the consequence of them not paying specific expenses?
• Identify one other surprising statistic that you see in these examples.

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Want your students to experience what it feels like to live “paycheck to paycheck” with limited savings? Play the award-winning game Spent. Here’s what one teacher said about the game:

This was an amazing resource. I think it was a very concrete way of showing an abstract concept to students. It was very real-life and showed students exactly what types of choices they might have to make when living on their own. There were many things that I’m sure they wouldn’t necessarily think about on their own, such as missing work for a sick child or car repairs. I think that the way the activity is laid out is very realistic and very thought-provoking. I actually think this is a great activity for adults as well. I would like to do this activity with the other teachers in my building in order to introduce them to these resources. It is very powerful.

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.