I am an avid reader of Ben Carlson's Blog A Wealth of Common Sense for a good reason; he takes this complex topic of investing which vexes many an educator and makes it accessible and simpler for all of us to understand. His recent post, 36 Obvious Investing Truths is a great example of this common sense approach to investing as he distills his years of experience into a set of "truths." Here are a few examples:

1. If you need to spend your money in a relatively short period of time it doesn’t belong in the stock market.

2. If you want to earn higher returns you’re going to have to take more risk.

3. If you want more stability you’re going to have to accept lower returns.

4. Any investment strategy with high expected returns should come with the expectation of losses.

So, here's the activity idea: 

• Have students read the article and do the following:
  • Circle the truths they don't understand
  • Put a box around the truths they disagree with
  • Number their top 5 that they think are most important (1=most important) in their lives
  • Underline those 3-5 truths that were most surprising to them
• Once students have completed that exercise, have them form groups of 3-4 and compare their answers 
  • For the truths that they don't understand, see if other group members might be able to explain
  • Have the students compare their top 5 to see if there is any consensus
• Teacher leads group discussion where groups share their insights that came from their group

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One of my favorite investing interactives (Think You Can Beat the Market?) demonstrates the futility of trying to time the market while also highlighting the behavioral aspects of investing (regret, euphoria, overconfidence)

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.

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