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Financial Literacy

The fun never dividends.

Being an adult is a drag. But you know what's worse than wearing mom jeans? Having no money to finance your adult life. Thankfully, our course will help you afford jeans of any cut. Shmoop's Financial Literacy course is an introduction to the financial concepts every (soon-to-be) adult needs to know and will give you what you need to go from high school to high society.

In our activities and lesson plans, we'll cover

  • the basics of investing, including stocks, bonds, mutual funds, IRAs and other important investment topics.
  • how compounded interest works.
  • why retirement is a beast you'll need to (and can) conquer, and how IRAs and 401(k)s are your best weapons for victory.
  • opportunity costs, including the opportunity cost of one of the top expenses in a person's life: college.
  • how mortgages work, including the benefits of buying versus renting.
  • how to create a budget plan for your life.

This course is the sequel to our more basic course, Personal Finance 101.

Course Breakdown

Unit 1. Financial Literacy

This course goes beyond the basics of Personal Finance into the Big Three Things that adults must think about: investing, retirement, and home ownership.

Sample Lesson - Introduction

Lesson 1: Exponential Money

Here's what our boy Adam Smith said a couple hundred years ago:

"Man is an animal that makes bargains: no other animal does this—no dog exchanges bones with another."

It's true. We're just as smelly and hairy as other animals, and we're just as distracted by shiny things (Ooooooo, another Transformers movie?!), but our business is way, way more complicated.

For example: interest. As you know, interest is the fee that somebody pays when they borrow money. Rather than paying a fixed fee (like $50 to borrow $2000), they pay a percentage of the borrowed money.

"Until you pay me back, you owe me an extra 1% of your debt, every month." That 1% fee is the interest.

"My interest rates are low! Only one dead squirrel a month for the first year!"

(Source)

Interest is more complicated than a fixed fee, but it's also more fair: if one dude borrows $2000 for a month, and another dude borrows $2000 for 5 years, why should they pay the same fee?

You earn interest when you put money in the bank, too. Why? You're actually lending the bank your money. They need to pay you interest as a little "thank you" for not believing crazy YouTube conspiracy videos and storing your cash in a coffee can under the bed.

We're just reviewing right now. You know all this stuff. But today, interest is going to get even more complex. We're gonna talk about compound interest.

Basically, compound interest is interest that compounds every year (or every month). Your interest earns more interest as time goes on.

Confused? No worries: you'll be wheeling and dealing before you know it.

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  • Course Length: 2 weeks
  • Grade Levels: 9, 10, 11, 12, College
  • Course Type: Short Course
  • Category:
    • Business and Career Preparation
    • College Prep
    • Life Skills
  • Prerequisites:
    Personal Finance 101
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