Adults know how expensive life can be – car payments, rent or mortgage, groceries, utilities and the list goes on.
Wednesday, Edgewood Middle School eighth-grade students got a glimpse of the cost of living when Lake City Bank brought its “Reality Store” to the Warsaw school.
“I think it’s a really good way to get kids to understand what your life could end up like,” said student Mikaela Till. “I think its a little bit harder (than I thought) just because you never know what could happen. You think you are doing fine, but then you can go totally bankrupt.”
Student Danielle Olds said, “I think it shows how hard life really is. I think it’s showing kids how much their parents really are paying for.”
“I think it helps us understand what our financial difficulties can be in the future,” said student Drew Carson. “How we should learn to budget to support our families.”
Lake City Bank provided the Reality Store for free to Edgewood as a community service. All eighth-graders participated in the financial literacy program through their history classes.
According to organizer and Edgewood Family and Consumer Sciences teacher Edith Rohrer, in the simulation each student is assigned an occupation. Assumed to be 28 years old, they are provided with a monthly salary, marriage status and number of children from zero to three.
Each student has to purchase housing or can choose to rent. There are different houses to choose from, with the size of houses affecting other costs like utilities.
Insurance must be “bought” for the home, as well as life and health if the student decides they need it.
Students also must find transportation. They can “buy” a new or used car, or decide to rely on public transportation.
If a student has children, they have to go to the child care table. If they are a single parent, they must buy child care. If they are married, they can determine whether their spouse is a stay-at-home parent or works. If the other spouse works, they must get child care but they can receive a $1,000 credit.
For groceries and clothing, students have three prices to choose from, and the amount they spend also is determined by their family size. There’s low-, medium- and high-priced items.
Entertainment has a lot of choices from going to a sporting event to playing golf. Students can also decide if they want to eat out.
Every eighth-grader also must visit the “Fate” booth, “for little things you don’t count on,” Rohrer said. “You don’t plan on them, but you have to budget for them.”
If a student has anything left in their monthly income, there’s a list of charities they can decide whether or not to give to. Or, if a student prefers, they can put the money they have left in savings.
“Hopefully,” Rohrer said, “they don’t go bankrupt, but some do.”
She said Lake City Bank provides the Reality Store for free because the bank is part of the community. Lake City brings in all the materials and its employees run it.
“It helps us meet our benchmarks in the Indiana financial literacy education law,” said Rohrer.
The Family and Consumer Sciences Department sponsors the Reality Store, but students participate through their history class so that all eighth-graders can experience it.
This is the first year Edgewood has participated in the Reality Store.
“They are making decisions. They are coming up to me, showing me their papers, and talking to each other. They are really figuring things out,” Rohrer said.
History teacher Tim Devlin said, “The kids have been really receptive. When we talked about it in class, the students talked about the different avenues their parents have gone through.”
Devlin said his classes went over what to expect for about 20 minutes Tuesday. They discussed how to do it and went over an example.
“I was surprised how much they already knew coming into it,” Devlin said.
Lake City Bank branch manager Sherri Shafer said a total of 13 employees were working the Reality Store during the day. It is the first time a Reality Store was held at a Warsaw school, but Lake City Bank has had the simulation program in other areas like South Bend.
“We want to get involved in the community. By doing this, we feel like the kids are having a fun learning experience,” Shafer said.
