Category Archives: Lesson Idea

Question: What’s The Implied Interest Rate On Rent-To-Own Merchandise?

This Consumer Reports video got me thinking about how this question can be structured as an activity to develop your students’ comparison shopping and Excel skills.  Here’s the video:

First, let’s get the comparison shopping out of the way.  I chose this washer-dryer pair advertised at one of the leading rent-to-own companies:

Screen Shot 2015-07-10 at 3.29.07 PMHow much would the washer-dryer pair cost if you could buy it upfront at this retailer?

Note the everyday low price noted on the top right (or Cash Price at bottom center) of $1,424.98.  I wanted to see how that might compare if you tried to buy the same Maytag Centennial Washer and Dryer at a “big box” retailer.  After a 30 second Google search, I came up with the following costs at one retailer:

Assuming that figures for rent-to-own and “big box” exclude taxes and delivery, the “big box” cash cost of $1,097 is 23% less than the cash cost at the rent to own.  Why is this important?  It shows that the rent-to-own customer is starting out with a handicap as they will be renting an item at an already inflated price.

What is the implied interest rate with the rent-to-own model, using the data for this washer-dryer pair? Continue reading

Want Budgeting to Stick With Your Students? Find an App!

USA Today reporting on recent Neilsen study that shows 1) More consumers using budgeting apps on their mobile phones 2) Those that do, are successful at controlling their spending:

In a survey of more than 3,600 smartphone owners who use their phones to shop or bank, out this month, 18% said they use their phones to budget and of those, 69% said they strongly or mostly agree that budgeting apps have helped change their spending habits.

Why do people enjoy using budgeting apps? Continue reading

Lesson Idea: How I Used the Warren Buffett – Lebron James Conversation to Teach Investing!

I wanted to share the investing lesson that I used today with my high school seniors.  We had played the retro investing game Stocks and Bonds on Tuesday which provided a sense of the emotions that often come with investing.

We used the first ten minutes of class to reflect on the lessons from the game and then had a ten minute class discussion.  Among the insights they gained:  importance of diversification, “the roller coaster ride” of investing, dividends as an income source, the futility of predicting the direction of the market and the relationship between risk and return.  It was great to see that a fun game that engaged all students also taught them such valuable lessons.

Given that I only had about 70 minutes, at this point, for a topic (investing) that could span a semester, I looked for inspiration last week when I stumbled across this recent CNBC clip of Warren Buffett giving investment advice to Lebron James.  Let me tell you the reasons that I love this clip: Continue reading

Activity Idea: What is the Return on Investment For Your College Education?

With college costs continuing to rise, more students and their families are asking the question about whether the cost of college is worth it.  I came across this tool today from PayScale which calculates a Return on Investment for over 1,000 U.S. colleges.  This presents a great opportunity to have students investigate this issue further.

Here are some questions to ask your students as they use the tool: Continue reading

Question of the Day: How Will the Apple Watch Launch Affect Apple’s Stock Price?

This is a great research project for students.  It will hone their media literacy skills, is high interest and current and will also teach them about how expectations are built into stock prices.

AppleWatch

You might ask the students to find answers to the following questions: Continue reading

Case Study: The Mystery of The $8 Million Janitor

Great opportunity to use this inspiring case of the part-time janitor with an $8 million investment portfolio to teach critical investing and budgeting lessons including the power of compound interest, investing in stocks for long-term growth, living frugally and sharing your wealth.

http://player.theplatform.com/p/gZWlPC/cnbc_global?playertype=synd&byGuid=3000353167&size=530_298

From CNBC: Continue reading