3.1 Why Save?

Instructions

OBJECTIVES & STANDARDS
Math Objectives
Analyze key features of linear graphs in context, including slope, y-intercept, and the intersection of two lines
Graph linear equations representing a saving account balance with a constant rate of deposit
Common Core Math Standards
Link to all CCSS Math
CCSS.PRACTICE.MP1
CCSS.PRACTICE.MP4
CCSS.HSF.IF.B.4
CCSS.HSF.BF.A.1
CCSS.HSF.IF.C.7.A
Personal Finance Objectives
Explore reasons for saving, including offsetting unexpected costs, managing variable income, and making large purchases
Analyze real-world data related to saving
Identify common savings goals
Describe the benefits of an emergency fund
National Standards for Personal Financial Education
Spending
1a: Identify their short-term and long-term financial goals
Saving
9a: Explain how external influences (e.g. peers, family, or social media) can impact personal savings decisions.
DISTRIBUTION & PLANNING
Distribute to students
Student Activity Packet

CREATE: Your Savings Goals
The first step in saving money is to figure out your saving goals. What would you like to save for?

9

Complete the table with potential savings goals you would like to meet. These goals can vary from small (saving for a new pair of sunglasses) to big (saving for college). Write at least three goals in each category.

VIDEO: 70 Men Ages 5-75: What Are You Saving Money For?
People save money for all kinds of different things. In this video, you’ll hear from 70 men of all ages about their saving goals. Think about their goals and reflect on your own.

1

What types of things did people say they were saving for in the video?

1

Look back at the goals you wrote in the intro. What is one goal you can start saving for now?

ACTIVITY: It Costs HOW Much?
You might want to save for a car, an apartment, a video game, or something else. But how much will it cost? Follow your teacher’s instructions to complete this activity and learn how much you’ll need to save to reach these popular goals.

1

What costs surprised you the most? Why?

1

Does this change any of your personal savings goals or plans? Why or why not?

1

Why might it be beneficial to save for some of these purchases in advance, even if you could pay for them right now?

VIDEO: Emergency Funds: How Much To Save & How To Get Started
In addition to saving for exciting life events and big purchases, it is important to save for unexpected expenses. Watch the video to learn the benefits of an emergency fund, then answer the questions.

1

According to the video, how much should you aim to have saved in an emergency fund?

1

What is one tip for growing your emergency fund?

1

What do you think are obstacles that might stop people from building an emergency fund?

1

ANALYZE: Why Save?
Saving prepares you for the unexpected. In the three graphs below, you’ll analyze real-world data that reveals the importance of saving.

1

In which industry are workers most likely to have varying income month-to-month?

1

Retail salesperson is the largest occupation in the US, with over 3.5 million workers. What percentage of workers in the wholesale and retail trade industry report their income varies month to month?

1

How does this graph illustrate the importance of saving?

Graph 2: 
The graph shows how many people faced specific financial hardships during the COVID-19 pandemic. It is separated into two groups: households whose income decreased (green) and households whose income did not decrease (yellow).

1

What percentage of households where someone lost a job or took a pay cut used money from savings or retirement to pay bills?

1

Based on this graph, how would you summarize the impact of COVID-19 on households who lost a job or took a pay cut, compared to households who did not?

1

You’re including this graph in your presentation on the importance of saving. Write an appropriate title for this graph.

Graph 3: Savings Matter for Families at All Income Levels

2

Look at the column for middle-income families.
a.  After an income disruption, what percentage of middle-income families with $0 in savings experience financial hardship?_______ 
b.  What percentage with $20,000+ in savings experienced financial hardship?_______ 

2

Analyze the outcomes for families with savings between $2,000 and $4,999 after an income disruption.
a.  What percentage of low-income families with $2,000 - $4,999 in savings experience financial hardship?_______ 
b.  How does that compare to the percentage of middle- and higher-income families who experience financial hardship at the same savings level?_______ 

1

Based on the graph, what is the relationship between savings and experiencing financial hardship after an income disruption?

1

CALCULATE: Savings Over Time
You can use linear functions to represent your savings over time and calculate when you’ll meet your savings goals.
The graph below shows Kaia’s saving account balance over time, where y represents the total balance in dollars and x represents the number of weeks since she opened the account.

1

What is the slope of the line?

1

What does the slope represent in this context?

1

Based on the graph, how much did Kaia put in the savings account when she initially opened it?_______ 

1

Sara wants to save $5,000 to put towards college. She has a savings account with $320. Each month, she deposits $180 from her part-time job in the savings account.

1

Write an equation that represents her savings account balance, y, after x months.

1

How much does she have after 3 months?_______ 

1

If she continues saving $180 per month, how long will it take her to reach her goal?
How can you find that point on the graph?

1

All of the following are benefits of saving, EXCEPT...
Having money in a savings account enables you to prepare for large purchases
Having money in a savings account offsets the impact of changes in income
Having money in a savings account cushions you when faced with unexpected expenses
Having money in a savings account is more accessible than in a checking account

1

As a rule of thumb, how much do experts recommend you save in an emergency fund?
1 month of expenses
3-6 months of expenses
6-8 months of expense
1 year of expenses

1

Lucas has $300 in his savings account and starts saving $75 per month. He wants to meet his savings goal of $3000. How long will it take him to reach his goal?
4 months
10 months
36 months
40 months

3.1 Why Save?

Complete the table with potential savings goals you would like to meet. These goals can vary from small (saving for a new pair of sunglasses) to big (saving for college). Write at least three goals in each category.

What types of things did people say they were saving for in the video?

Look back at the goals you wrote in the intro. What is one goal you can start saving for now?

What costs surprised you the most? Why?

Does this change any of your personal savings goals or plans? Why or why not?

Why might it be beneficial to save for some of these purchases in advance, even if you could pay for them right now?

According to the video, how much should you aim to have saved in an emergency fund?

What is one tip for growing your emergency fund?

What do you think are obstacles that might stop people from building an emergency fund?

In which industry are workers most likely to have varying income month-to-month?

Retail salesperson is the largest occupation in the US, with over 3.5 million workers. What percentage of workers in the wholesale and retail trade industry report their income varies month to month?

How does this graph illustrate the importance of saving?

What percentage of households where someone lost a job or took a pay cut used money from savings or retirement to pay bills?

Based on this graph, how would you summarize the impact of COVID-19 on households who lost a job or took a pay cut, compared to households who did not?

You’re including this graph in your presentation on the importance of saving. Write an appropriate title for this graph.

Based on the graph, what is the relationship between savings and experiencing financial hardship after an income disruption?

What is the slope of the line?

What does the slope represent in this context?

Write an equation that represents her savings account balance, y, after x months.

If she continues saving $180 per month, how long will it take her to reach her goal? How can you find that point on the graph?

As a rule of thumb, how much do experts recommend you save in an emergency fund?1 month of expenses3-6 months of expenses6-8 months of expense1 year of expenses

Lucas has $300 in his savings account and starts saving $75 per month. He wants to meet his savings goal of $3000. How long will it take him to reach his goal?4 months10 months36 months40 months

Complete the table with potential savings goals you would like to meet. These goals can vary from small (saving for a new pair of sunglasses) to big (saving for college). Write at least three goals in each category.

What types of things did people say they were saving for in the video?

Look back at the goals you wrote in the intro. What is one goal you can start saving for now?

What costs surprised you the most? Why?

Does this change any of your personal savings goals or plans? Why or why not?

Why might it be beneficial to save for some of these purchases in advance, even if you could pay for them right now?

According to the video, how much should you aim to have saved in an emergency fund?

What is one tip for growing your emergency fund?

What do you think are obstacles that might stop people from building an emergency fund?

Maryam’s average monthly expenses are $3,750. She wants to have an emergency fund that covers 3 months of expenses saved up within the next 24 months. If she’s starting with $300 in her account, how much does she need to save each month to reach that goal?

In which industry are workers most likely to have varying income month-to-month?

Retail salesperson is the largest occupation in the US, with over 3.5 million workers. What percentage of workers in the wholesale and retail trade industry report their income varies month to month?

How does this graph illustrate the importance of saving?

What percentage of households where someone lost a job or took a pay cut used money from savings or retirement to pay bills?

Based on this graph, how would you summarize the impact of COVID-19 on households who lost a job or took a pay cut, compared to households who did not?

You’re including this graph in your presentation on the importance of saving. Write an appropriate title for this graph.

Based on the graph, what is the relationship between savings and experiencing financial hardship after an income disruption?

The original title of this graph is “Savings Matter for Families at All Income Levels”. Do you think this is a good title for this graph? Why or why not?

What is the slope of the line?

What does the slope represent in this context?

Write the equation of the line representing Kaia’s balance.

Write an equation that represents her savings account balance, y, after x months.

Graph Sara’s savings account balance and goal using Desmos. Use this graph to answer the following questions.

If she continues saving $180 per month, how long will it take her to reach her goal? How can you find that point on the graph?

Approximately how many months earlier will Sara meet her saving goal if she saves $240 per month, instead of $180 per month?

If Sara wants to reach her $5000 goal in one year, approximately how much would she need to save each month?

As a rule of thumb, how much do experts recommend you save in an emergency fund?1 month of expenses3-6 months of expenses6-8 months of expense1 year of expenses

Lucas has $300 in his savings account and starts saving $75 per month. He wants to meet his savings goal of $3000. How long will it take him to reach his goal?4 months10 months36 months40 months

Maryam’s average monthly expenses are $3,750. She wants to have an emergency fund that covers 3 months of expenses saved up within the next 24 months. If she’s starting with $300 in her account, how much does she need to save each month to reach that goal?

The original title of this graph is “Savings Matter for Families at All Income Levels”. Do you think this is a good title for this graph? Why or why not?

Write the equation of the line representing Kaia’s balance.

Graph Sara’s savings account balance and goal using Desmos. Use this graph to answer the following questions.

Approximately how many months earlier will Sara meet her saving goal if she saves $240 per month, instead of $180 per month?

If Sara wants to reach her $5000 goal in one year, approximately how much would she need to save each month?

If she continues saving $180 per month, how long will it take her to reach her goal?
How can you find that point on the graph?

As a rule of thumb, how much do experts recommend you save in an emergency fund?
1 month of expenses
3-6 months of expenses
6-8 months of expense
1 year of expenses

Lucas has $300 in his savings account and starts saving $75 per month. He wants to meet his savings goal of $3000. How long will it take him to reach his goal?
4 months
10 months
36 months
40 months

If she continues saving $180 per month, how long will it take her to reach her goal?
How can you find that point on the graph?

As a rule of thumb, how much do experts recommend you save in an emergency fund?
1 month of expenses
3-6 months of expenses
6-8 months of expense
1 year of expenses

Lucas has $300 in his savings account and starts saving $75 per month. He wants to meet his savings goal of $3000. How long will it take him to reach his goal?
4 months
10 months
36 months
40 months