Who doesn’t love money? Ask any Stanley Clark fourth grader, and they’ll tell you about it. Every year, our fourth-grade students embark on a year-long journey into making, saving, and spending money. The power of using a mini-economy system in the classroom is invaluable. It’s a highly successful tool for classroom management, student self-regulation, financial literacy, and entrepreneurship.

Classroom Management and Student Self-Regulation
Students submit applications for classroom jobs each quarter that earn a weekly paycheck. They learn to take responsibility for their job and show considerable pride in being in charge of it. They take on roles that help the classroom run smoothly, such as daily scheduler, banker, caring for the class pet, passing out papers, being classroom managers who check for clean desks and cubbies, etc. Students still earn a wage if they’re absent (think paid time off), but if they consistently forget to do their job and other students must fill in for them, their paycheck can be reduced to pay the substitute worker. An added benefit to this process is that students learn to help hold one another accountable for their responsibilities, so there is equal ownership in keeping the classroom environment running smoothly.

The paycheck is not the only way to earn money, however. Students also earn money for doing good deeds, being responsible with homework, and other classroom routines. In contrast, they learn that actions can have consequences, just like in the real world. Being unprepared by not having class materials or not completing homework on time may result in a fine. Since no one wants a fine and everyone wants a reward, we can guarantee that nearly everyone will complete or return their assigned work, which naturally bolsters academic growth. Everyone wins.

Financial Literacy
What do they do with all the money they save? First, students must save enough money to cover potential fines and monthly taxes, or students have to create a plan, like taking on an extra job or getting an IOU to pay off the debt. But being a good saver generally affords students certain luxuries in classroom life. Several times throughout the year, we hold silent auctions where fourth-grade students try to outbid each other for various items “for sale” from their teachers. During these often-intense events, students realize what they can and cannot afford, especially if they’re looking forward to saving for something bigger like a buy-in day. These special days allow students to pay to participate in things like extra free time or snack bars. If they spend too much money on a previous event and can’t afford the newest, greatest options, students quickly learn that spending too much can affect their future. We keep these special event days a surprise to help build suspense and keep the students engaged all year.

Entrepreneurship
What if someone doesn’t want to spend money on a silent auction or a buy-in day? Twice a year, students host a Mini-Mall where they become entrepreneurs and create a business with homemade products to sell. They pay rent for their store space, and then numerous grade levels and the staff are invited to shop. Through this event, they discover what type of items sell well for their intended audience, how best to price them to ensure a sale, how to set up an eye-catching display, engage with shoppers, and calculate sales.

The Big Finale
At the end of the year, the entire mini economy comes to a close when students attend the big “Kiddie Kaleidoscope” live auction. Mimicked after our school fundraiser gala, Kaleidoscope, students gear up to spend their remaining funds at this grand finale. Staff members throughout the building offer experience packages such as classroom assistants for the younger students or special lunches and desserts with administrators.

This event results in one of three big lessons:

1. If they’ve saved well throughout the year, they can buy anything they want on their own.
2. It is sometimes more financially feasible to split a package with classmates.
3. They can’t afford big-ticket items, so less expensive options are the way to go.

The Benefits in a Nutshell
A mini economy facilitates teaching numerous core academic subjects simultaneously and allows students to fail forward. They can make choices and try things without real-world consequences where the stakes are much greater. It teaches students to be adept mathematicians in addition and subtraction, the importance of financial planning, a strong understanding of supply and demand and return on investment, and how adjusting daily behaviors and work ethic can make a big difference in their lives. Engaging students in a well-run mini-economy system takes time and energy, but we promise it’s worth every penny. 

About the Author

Meredith Hershberger

4th Grade Teacher

mhershberger@stanleyclark.org