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Learning money management is just a game

Ashley Milne-Tyte Sep 30, 2011

Learning money management is just a game

Ashley Milne-Tyte Sep 30, 2011

Tess Vigeland: The Eurozone may be in deep financial doo-doo right now, but one of its recent exports shows more than a little money savvy. It’s a financial literacy board game. And we sent Ashley Milne-Tyte to see how it’s translated to an audience of American students.

Sound of kids laughing and talking

Ashley Milne-Tyte: Most of the 13 New York City high school kids in this room have barely thought about personal finance before. Now, they’re gathered round a table in an office at the City’s Department of Youth and Community Development, dice at the ready. They’re about to play a game called “Nest Egg.”

Erin Kanter: What we’re gonna do is we’re gonna rotate around so that everyone can roll the die. You’re gonna determine what happens to stocks first…

Sound of die rolling

That’s Erin Kanter, head of marketing for Nest Egg. She acts as the banker during the game. Here’s how you play: Kids form small teams. Each team acts as a financial adviser for a fictional young couple who wants to buy a home, save for their child’s college fund and retire 30 years from now debt-free. It’s up to the players to achieve those goals. A roll of the dice can bring a boon or a disaster.

Vladimir Fichtner is one of the game’s inventors.

Vladimir Fichtner: You know stocks go up and down, bonds, money markets, they are all part of the game.

If you’re wondering about the accent, Fichtner is from the Czech Republic. He and some friends came up with the idea for Nest Egg in the 1990s. At the time, Czech citizens were grappling with how to handle their own finances after decades under communism, when the state took care of everything and there were no stock or bond markets. Today, Nest Egg is played in hundreds of schools in the Czech Republic and by trainee bankers at the country’s largest bank.

Kanter: Final Wall Street. Who’s the other — where’s the other die?

In New York the Department of Youth and Community Development is experimenting with the game. If today’s pilot goes well, it could be rolled out in after-school community centers and possibly in high schools later on. The department’s Luis Osorio says the kids who hang out at community centers tend to come from poorer families and really need financial coaching.

Luis Osorio: Kids don’t sit down and say, “Dad, how much do you make? Do we have insurance, do we have any investments?”

Osorio and his colleagues say poor money management is at least part of the reason for this sobering statistic: 40 percent of New York City public school graduates who go on to one of the City’s colleges drop out within two years.

Student: All right, all right. Just roll the die.

Kanter: One child, so that’s gonna decrease your cash flow by $50.

Student: Oh man…

Kanter: So move back two spaces.

Kids laughing

Nest Egg has been introduced into the high school curriculum almost 2,000 miles away in Corpus Christi, Texas. Carol Loeb teaches economics at King High School. She says before it was hard to get her students to grasp concepts they had no experience with. But that’s all changed. She recalls one student who was failing. Then his class started playing the game.

Carol Loeb: That was the fist time the whole semester this kid had come alive. He could not wait to get in the classroom, he came in and told me what he had thought about the night before, what he wanted to do, what he wanted to invest in, and he was totally, totally engaged.

Kids counting their winnings

Back in New York, the game is wrapping up.

Milne-TYte: So how’s this team doing?

Alejandro: Bad.

Brendis Gonzalez: Horrible!

Milne-Tyte: Why?

Brendis: ‘Cause we forgot to buy the disability insurance, so we went to the negatives. But we got ourselves out into the positives, but still.

Brendis Gonzalez and her teammates wanted to make $300,000 for their fictional couple’s retirement. They ended up with far less because they drew an accident card and hadn’t bought disability insurance. Their family went bankrupt and had to start from scratch.

Afterwards, Gonzalez says she made some big mistakes, but she’s learned from them. She’d like to use her newfound financial knowledge to help her widowed mother, a home health aide.

Brendis: I’ve seen how much money has been a problem and I never even thought that, like, bonds could help you or that you could invest to make, like, your own money grow.

She’s never spoken to her mother about money, but says she’s about to start.

I’m Ashley Milne-Tyte for Marketplace Money.

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