Does borrowing cost that much?
Erik van Dijk, economics teacher has a mission: he wishes to teach pupils to get a solid basis for sensible financial behaviour. He is using the teaching package that forms part of the curriculum “Money and I” to raise the financial awareness and skills of pupils in the second year.
“What does it mean sir, to have a hole in your pocket?” asks a boy in the centre row of the class. “It means you cannot handle money well,” is the immediate response of a classmate. “Just about,” is the answer of the economics teacher Van Dijk who agrees, “but especially in the sense that you spend money too easily. Does anyone ever have this problem?” A few hands are raised hesitantly. “It may be difficult,” he continues, “just think about it”.
It is possible to spend money on all sorts of things such as food, clothing, presents, but it is particularly the mobile telephone that seems to be the largest expense for those in the classroom. When the question is asked how much pupils spend on a monthly basis, hardly anyone really knows the answer. But prior to Van Dijk focusing on that, it is now the time for a series of assertions. It is quiet in the classroom once the pupils are on their laptops to give their opinions on a number of aspects about spending money.
A solid base
We are at the CSG Willem de Zwijger school in Schoonhoven. During the lessons to the second year of prevocational secondary education, the teacher Erik van Dijk is teaching the module “My expenses” which forms part of the teaching package ”Money & I”. Van Dijk has been pleading for years to teach the basics of finances at school. “From the start of my teaching career in 2007, I was struck by the fact that youngsters have no idea how to handle money sensibly. I find it interesting and worrisome at the same time. In the meantime, it has become clear that debt problems amongst the young are on the increase. It is for that reason that I have joined the Guide for Financial Matters to help and find solutions. I take it to be my task to provide a solid base for the pupils so that they can build up a healthy financial management.”
“Ready sir!” Van Dijk finalizes his round of the class and like magic, he presents the percentages on the digital board showing the answers the class gave. “Thirty percent of you know what is possible to spend every month,” and he selects one point. “Do you remember that we talked about your income last week? Did anyone make a list of what is coming in? Once you know, you also know how much you can spend. It is just like your mobile phone contract: once it is used up, it is gone.”
“But I just want to buy things,” says Jochem*, who is in the back of the classroom. “You can also borrow money?” adds his classmate sitting next to him. “Aha! I will get back to that shortly,” is Van Dijk’s response. “Jochem, was it you who might be regarded as a big spender in the quiz?” There is laughter all round.
“Boys, I understand that it is fun to buy things and there is nothing wrong with it but it is important to think it through. To manage money always involves choices. What is going to happen if you spend more that you have?” “Well, you then have less than nothing, sir.” “That is precisely the point. You get into debt.” The teaching material gives more information. In the following twenty minutes, there is a buzz in the classroom while the pupils look at worksheets in small groups.
Money-type quiz
In addition to the fact that Van Dijk is regarded as “a walking calculator” in the Willem de Zwijger school, he is known as the man who manages money sensibly. “I am continuously involved in fun activities around this theme. I take the lead in the Week of Money. Typically, I do the money-type quiz with the pupils and I hand out the Money-Checker: the money newspaper for youngsters published by Nibud. I add a sticker with my details as pupils can always come and see me if they have any questions. I recently asked for five hundred copies of a special Donald Duck edition which was made in cooperation with the Money Guide. They are very popular.”
Van Dijk is also very enthusiastic about the teaching package “Money & I”. “Five lessons of one hour each provide teaching to youngsters covering the main topics of finance. The lessons are up to date and they can be taught separately. I like the fact that it is interactive and that the pupils react to their class mates’ opinions. How they think about finances is an interesting starting point for a discussion.”
A promise is a promise: Van Dijk returns to the topic of borrowing money in the last part of the lesson. “Don’t do it,” is his message. “But you do for a house, don’t you?” is the question from Elinie in the front of the class. “Yes indeed, you take out a mortgage for a house, and that is a loan. But as far as I am concerned, that is the only good reason for doing it. Honestly, try to avoid it. As borrowing …” “it costs money,” Emma concludes. “Yes! Let’s try and look at that in detail. Suppose, I take out a loan to buy a new car that costs ten thousand Euros…” Five minutes later there is an astonished conclusion: Does borrowing cost that much?
Sharing errors
It is absolutely clear to Van Dijk: financial education should be an obligatory component in the curriculum. He attempts to spend a minimum of one hour every week on financial knowledge and skills. “I know the timetables are full but it is so vital that it deserves to be a priority.”
In addition to the module in the second schoolyear, Van Dijk returns to the topic in the following years. “It is of crucial importance to oversee things step by step with the boys and girls. Repetition means it leaves a lasting impression.” He finds that the pupils are open to learn. “Especially, when the material is converted to their own lives and their future. I make jokes and I have empathy which is a way of keeping it light. We do have a laugh. I am also open about my own financial choices and the errors I have made at times. An example is that I bought something on Marktplaats and it was never sent, which brings it into focus.”
Van Dijk is convinced that financial education generates results. “I note the development of their awareness and I observe that the pupils of the third and fourth years have retained what I taught. It gives me confidence that when the youngsters leave school, they have a good basis.”
* the names of the pupils have been changed
Geldlessen.nl
The Dutch website geldlessen.nl contains an extensive selection of teaching materials and guest lessons on the topic of how to manage money for elementary schools, special needs education, secondary education and secondary vocational education.
Source reference: This article was published in March 2021 in a special edition on Financial literacy in the educational journal.
Erik van Dijk agreed with the translation of this article for EUFin.
You can read the magazine online.