June 19, 2010

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This lesson is the initial lesson in the "Sims Family" unit. It covers at least four instructional days. In it, students will use internet resources to find their monthly net income from their gross annual pay, and proceed to find values for the basic categories of their monthly budget. For housing, they will determine what kind of a mortgage (if any) their family income can afford them and then shop for and decide upon housing. For transportation, they will shop for and decide upon a car and then use internet resources to get an insurance quote. For food, they will discuss with their parents and guardians their own family food budget. Then, using this information, they will conduct research into a weekly food budget for their own Sims family. They will enter all this information on the running budget worksheet for their family.

- Mathematics > General
- Mathematics > Applied Mathematics
- Mathematics > Arithmetic
- Mathematics > Problem Solving
- Social Studies > General
- Social Studies > Economics

- Grade 6
- Grade 7
- Grade 8

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This lesson is lays the groundwork for the real life unit, in which students will use their "Sims" family as the basis for seeing how much of the Math 7/Pre-Algebra curriculum intersects real, daily life. In this lesson, students are establishing their family budget, based on a randomly assigned gross annual salary given to them by the teacher (or randomly chosen by the student). They will use this figure in conjunction with internet research to arrive at monthly budget figures for key budget categories.
This lesson can be run as a partner or group activity. However, it is most rewarding when individual students are invested in their own Sims family.

**Group Size:** Independent learners

**Learning Objectives:**

- Students will experience and appreciate how middle school mathematics skills are essential to real life tasks of family economics.
- Students will gain an exposure to and an appreciation for the basics of family economics, including budgeting, balance keeping, and saving.
- Students will use addition and subtraction of decimals in a meaningful, authentic context.
- Students will become familiarized with the use of the internet as a resource for research.

- Students will need a folder or three-ring binder (preferably one that has both pockets and brads for binding three-holed papers). This folder will be the physical repository for the portfolio that the students will build over the course of this unit. Ideally, the students would personalize this folder for their individual Sims family.

3. For this lesson, the teacher will need to have researched the median family income (MFI) for their area. They should generate a list of incomes, ranging from the poverty line to $200,000 and containing a majority of incomes at the MFI. They will cut these up and have student choose them at random in order to assign incomes for the project. It is important that the distribution of incomes mirror closely a normal distribution (i.e. very few high and low incomes, a lot of "middle class" incomes clustered around the MFI). These incomes are only gross incomes, as students will research their own net income. See attached example.

4. Digital projector connected to a computer with internet connection.

**Procedures:**

In this lesson, students are creating and personalizing their *"Sims"* families. They will need to keep track of several important worksheets that will serve them over the course of the unit. The primary, and most important, worksheet is the attached ** Family Budget Worksheet** that will serve as a reference for them throughout the project. Once distributed, it should be affixed in a very accessible place in their folder (preferably as the first page in the bound section).

The teacher should begin by explaining the goal of the project, which is to help students practice Pre-Algebra skills in the context of "real life". To do this, each of them will have their own Sims family. Additionally, in order to give the class a better taste of what "real life" is like, and to encourage discussions on income distribution and poverty later in the unit, not everyone's income will be the same. In fact, the distribution of incomes will mirror (as closely as possible) the actual distribution of incomes in the students' geographic area. *It is essential that the teacher reinforce the idea that this is NOT a competition, where the student with the most money at the end "wins". Rather, the goal is for students to enjoy themselves and to take this as seriously as possible, trying to make a life for their family that they would want themselves.*

Once each student has an income, distribute the * Presentation of Your Family* worksheet (attached). Have students enter their gross yearly income in the blank provided. Using the digital projector, walk through the process of determining the family paycheck for a fictitious annual income. Highlight where the students should look for their

Next, point out the question about taxes. Lead a brief discussion about payroll taxes, payroll deduction, and the difference between gross and net pay. Elicit from the students how they would determine how much they are being charged in taxes each month.

Next, point out the question about *yearly net income*. Highlight the fact that their paycheck only gives them their *monthly* net income. Ask them how they would arrive at their yearly *net* income. Find this together for your fictitious income. As a formative assessment, ask them to explain the difference between the fictitious gross yearly and net yearly incomes.

This should mark the end of the first day's instruction. Student homework should be to complete the ** Presentation** worksheet at home and be ready to present their family (in general terms) during the next class period. It is also imperative that students print out a copy of the paystub and place it securely in their portfolio. The teacher should encourage the students to be creative with their families, drawing pictures or finding pictures of their spouse and children, if they so desire.

The next class period should devote ample time to allowing the students to present their families. While students are presenting, the teacher should take the opportunity to perform a cursory assessment of the answers for net monthly pay, net yearly pay, and amount of taxes paid. The teacher should also ensure that the students have printed out a copy of their paystub. After everyone who wants to has presented, the teacher should distribute the attached * Finding Housing, Car, etc.* worksheet.

Using the projector and the worksheet as a guide, the teacher should walk the students through each step of the housing process for the fictitious salary. Be sure to highlight the difference between the *affordability calculator*, which allows the students to have a dollar figure for how much they should be able to afford (i.e. a maximum house value) and the *mortgage calculator*, which should only be used *after* they have found the house they want to buy. For this activity, students must print out or cut out the advertisement for the house that they want to purchase and include this cut out in their portfolio.

Note: for the lower-income students, it will be impossible for them to afford to buy a house. The teacher should address this reality in the discussion and show the students one or two examples of rental housing websites where the students can find rental housing. The teacher can also lead a discussion at this point highlighting the effects of the housing bubble on low- and middle-low-income families. The teacher should also remind the students that the goal of this project is to *do the best with what they have*, not to earn the most money, or have the biggest house. It would be an instructive moment to play on the frustrations of the lower-income students and use that to highlight poverty-based issues in the community.

With any remaining time this class period, the students should be allowed to begin work on their own affordability calculator. Their homework for this class period is to complete the *housing* portion of the ** Finding Housing, etc.** worksheet and to bring their printouts (of the affordability calculator, their chosen housing, and a mortgage calculator if applicable) to the next class.

For the next class period, some time should be given to discussion. Encourage students to discuss difficulties and successes in finding housing and encourage them to think critically about their choices. (i.e. Some students may be excited about the low cost of a "fixer-upper" home -- help students understand the implications of those choices, both in terms of their family life and in terms of their budget.)

This class period, the students will work on finding transportation. The teacher should use the digital projector to bring up a local car dealership website. Discuss the difference between leasing and owning a vehicle. Find an example of a vehicle to be leased, and show the students where to find the monthly lease price. Next, show students advertisements for new and used vehicles. Use one of these advertisements to walk them step by step through taking the sales price and turning it into a "monthly payment" by dividing it by 48 (to represent 4 years' worth of savings to purchase the car).

After you have chosen a car as a class, use the projector and the ** Finding Housing, etc.** worksheet to walk them step by step through the insurance quote process.

This should take the majority of a class period. With any remaining time, have students begin to look for their own transportation. The homework for this class period is to find a car (students *must* purchase or lease a car, even if they are poor). They must bring a printout of either the lease or sales advertisement, as well as the quote page from the insurance website. They should be prepared for the next day's class with a monthly cost for both their car and their car insurance.

The final aspect to this lesson will be to find a food budget. When students return for the next class period, lead a brief discussion on the successes and challenges of finding transportation. Allow the differences between wealthy and poor to play out, allowing students to express frustration and/or enjoyment over the process of looking for a car. These moments of discussion are prime opportunities for students to begin developing "money sense", or a more realistic notion of the cost of things. It can be instructive to point out exactly how many months of their salary a particular model of car would cost them, in order to help them have a more intuitive notion of value.

After this discussion, have students pull out their * Finding Housing, etc.* worksheet again. Refer to the

The students' assignment this evening is to research their own family food budget. They are to follow the directions on the worksheet, working closely with their parents/guardians to find a reasonable diet, given their budgetary constraints. If need be, the students should go to a grocery store to actually research the prices of the items they want to buy, or they may find the prices on the internet. Regardless, they should come to the next class with a detailed list and a final weekly food budget, signed by their parent or guardian that it represents a reasonable diet for a family of 4. The students should also have multiplied this number by 4 in order to obtain their *monthly* food budget.

The next day's class should be dedicated to "tying up loose ends" and ensuring that each student in the class has found all of the appropriate budget category amounts, as well as all the appropriate printouts. Before turning to individual students, the teacher should present the notion of a "balance" (the third column on the * Family Budget Worksheet*). The teacher should provide a brief demonstration of how to begin with the net income, subtract the housing budget, and find a new balance. After this, a fictitious food budget is inserted and this amount is deducted from the running balance. Ensure that all students understand this concept. At this point, the teacher should conference with each student for 1-2 minutes and determine an appropriate amount for

**Attached Files:**

FamilyBudgetWorksheet.doc | |

FindingHousingCarFoodandInsuranceBudgets.doc | |

PresentationofYourFamilyandFindingFamilyNetIncome.doc |

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