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The Cost of Life

Subject: Mathematics, Career Exploration, Economics, Technology

Grade Level: Grade 5, adaptable for grades 4-8

Materials: Internet access: Salary guides, shopping guides and advertisements for real estate, cars, groceries, and other living expenses. Word processing program, with use of spreadsheet/graphing tools (as in Appleworks or Microsoft Office); printer, preferably with color ink. Folders/large paper for students to create project portfolios.

About: After interviewing adults working in several fields of interest and using the Internet to research starting salaries, each student selects a career. The related salaries becomes their starting points as they develop their monthly budgets. Taxes are taken out as a flat percentage, and then the students calculate one third of the remainder as their maximum housing budget. They select an apartment or house, and then figure their various monthly expenses with online shopping tools. The highlight is the purchase of a car! Each budget item is calculated as a percent of the total income, and is expressed using spreadsheet and graphing tools.

Students build their Cost of Life folders as they complete each phase of the project, ultimately creating a reality-based compilation reflecting their financial priorities and obligations. On the cover is an illustration of the chosen career, with a brief essay explaining the reasons for this choice. The first page shows the salary and calculation of basic income tax and housing expenses, with housing not to exceed one third of income, and includes the ad clipping for the residence. The next page details the student's grocery budget, and so on. The last page of the folder includes a pie chart showing the breakdown of all of the expenses which together comprise the "Cost of Life."

Through this exploration, students start to consider the long-term impact of their life choices. One student changed her career choice after realizing that her peers who had elected professional jobs were going to make much higher salaries. Others have decided to go with lower-paying, more creative pursuits as a result of their interview research, and then have had the opportunity to see how these decisions impact their options as a consumer. Some students have minimized their housing costs by sharing apartments, and then have dealt with negotiations of what are shared as opposed to individual expenses when it comes to cable service and grocery selection. All students begin to appreciate the difference between variable and fixed expenses, as they see that certain expenses are roughly the same regardless of income. In using loan calculators for their housing and automotive decisions, they explore algebraic functions as they vary the terms and interest rates ... and begin to realize the importance of maintaining a good credit rating. Throughout this unit, students practice calculation and estimation in the context of real-life problem solving.

Teachers who implement this unit will find it helpful to set limited time frames for each phase, as students can become very absorbed in the various processes. In the initial phase of career research and selection, it may be helpful to begin by brainstorming possible interview subjects, in order to create a pool of possible candidates. Teachers can also select and provide web references, such as michaelgraves.com (product design and architecture), which students can use as "interview" resources. Recent classes have conducted email and speaker-phone interviews of an architect, a doctor, published authors, and an astronomer. This first phase is the most time-consuming, but is rich in subjective learning and in establishing a sense of motivation and investment on the part of the students. Each subsequent phase is a distinct "chapter" in the project; teachers can intersperse this with other units or use it as a "center" or as a Friday activity - but interest may lag if any one phase goes on too long. Students will need guidelines or graphic organizers to keep track of their information, especially with the online loan calculators. The individual portfolios are a good way to sum up the learning for each phase, and can then be stored by the teacher until it's time to add the next piece. Upon completion, each student will have an impressive presentation of work generated throughout the unit.

Research of objective and subjective information on various careers of interest.
Analysis of quantitative and qualitative information resulting in career choice.
Calculation of income tax as flat percent; division of remaining salary into monthly income.
Determination of housing budget (no more than one third of post-tax income); selection of housing based on budget and personal preference.
Organization of information in portfolio to communicate mathematical reasoning.
Virtual grocery shopping, considering nutritional needs and personal tastes.
Research on various living expenses: utilities, communications, clothing, etc.; calculation of percentage of income required to meet these needs. Development of spreadsheet to compile mathematical information; conversion of spreadsheet data to various graphs, including pie chart (good opportunity to discuss purposes of different graphs)
Consumer research on automobiles: comparing various models, contrasting advertisements with reviews by objective sources, depreciation of new vs. used models, insurance rates, etc. Selection of vehicle to purchase.
Use of online loan calculators: varying downpayments, terms, and interest rates to explore impact on monthly payment and total amount repaid; discussion of credit ratings.
Self-evaluation of overall decision-making, learning achieved.

This site provides info on interest rates, along with loan calculators for mortgage and car loans. Students may also want to explore sites for familiar banks with local branches.
This site allows students to research salary levels for various careers. Teachers may need to assist them in finding a specific job title, as students may be thinking in more general terms.
There are many sites for browsing auto prices, but the cars.com site is especially easy to use, with lots of listings for used vehicles. For new cars, it may be best to go directly to the manufacturer sites.
This is the shoprite.com site for online grocery shopping; there may be other stores with similar tools. Our students have used the Shoprite site as we participate in their Young Consumers program through our local Wakefern Shoprite.

Number Sense and Numerical Operations: This strand is addressed as students explore a "real life' context for the meaning of numbers, and the practical aspects of how a seemingly huge sum, such as $40,000, has its limits in buying power. Students practice estimation and develop a sense of proportionality, as they see how the income is divided to pay various expenses.
NJCCS 4.1 A, B, & C - grade 5
Patterns and Algebra: This strand is addressed as students use the online loan calculators. When they change one variable, such as the term of the loan, the other variables change as well. They see clearly how functions work, and the long-term impact of a couple tenths of one percent in the interest rate.
NJCCS 4.3 A, C - grade 5
Data Analysis, Probability, and Discrete Math: Students create spreadsheets and graphs to represent their data, and compare with classmates to find average income and other budgetary comparisons.
NJCCS 4.4 A- grade 5
Mathematical Processes: The entire unit is series of real-life mathematical problems, where there is no one clear answer, where students must consider complex information as they make decisions. This involves reasoning, representation, communication of mathematical thinking, and use of technology.
NJCCS 4.5 A,B, C, & E - grade 5

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Day 5:

Kristin Baker


Mansfield Township Elementary School
50 PortMurray Road
Port Murray, New Jersey 07840

Kristin Baker is the teacher and coordinator of the Gifted and Talented program at Mansfield Township Elementary, a K-6 single-school district. Her current position evolved from her creative and engaging math explorations, designed to challenge learners at all levels of ability in her 5th and 6th grade classrooms. Her 6th grade mathematics unit, "Design Your Dream House," was selected as a 2006 New Jersey Best Practice award winner.


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