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National Standards in K-12 Personal Finance Education
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Article Index
National Standards in K-12 Personal Finance Education
Uses for the National Standards
Organization of the Standards
The Standards
How the National Standards Evolved
Financial Responsibility and Decision Making
Income and Careers
Planning and Money Management
Credit and Debt
Risk Management and Insurance
Saving and Investing
Financial Responsibility and Decision Making
Income and Careers
Planning and Money Management
Credit and Debt
Risk Management and Insurance
Saving and Investing
Glossary
Independent Reviewers
Page 17 of 19

Saving and Investing

Knowledge Statements

These statements show relationships among the key concepts underlying the standards and expectations. They provide further guidance for publishers as they develop and revise curricula and for educators as they select classroom materials and plan lessons.

The statements are by no means an exhaustive outline of personal finance instruction. They merely suggest the scope of, and relationships among, the topics that the standards cover.

  • Overall Competency
    Implement a diversified investment strategy that is compatible with personal goals.

 

4th Grade

8th Grade

12th Grade

 

 

4th grade student can:

  1. People save for future financial goals.
  2. Every saving decision has an opportunity cost.
  3. Banks, savings and loan associations, and credit unions are places people can invest money and earn interest.
  4. Piggy banks are places to hold savings. Savings accounts and savings bonds are ways to earn money from income not spent.
8th grade student can:

  1. Saving means setting income aside for emergencies and immediate needs. Investing means putting money to work earning more money for the future. Funds for investing often come from current income not spent.
  2. Investments differ in their potential rate of return, liquidity, and level of risk.
  3. There is usually a positive relationship between the average annual return on an investment and its risk.
  4. Compound interest is money earned on both principal and previously earned interest.
  5. Inflation reduces the return on an investment.
  6. The Rule of 72 is a tool for estimating the time or rate of return required to double a sum of money.
  7. Investors can get information from many sources.
  8. People can buy and sell investments in different ways.
High school graduate can:

  1. Employer-sponsored savings plans enable workers to shift some current income to the future, often with tax advantages.
  2. Generally, the more uncertain the future value of an asset, the greater the return.
  3. Tax-exempt and tax-deferred investments signifi cantly increase an investor’s total return over time.
  4. Wealth increases with regular investment, time, and frequent compounding.
  5. Diversification reduces risk by spreading assets among several types of investments and industry sectors.
  6. Dollar-cost averaging lowers investment costs over time and promotes regular investing.
  7. Mutual funds pool investors’ deposits to purchase securities.
  8. Government agencies, such as the U.S. Securities and Exchange Commission, Federal Deposit Insurance Corporation, and state regulators, oversee the securities and banking industries and combat fraud.