North Central Mindanao College

MODULE 4
NORTH CENTRAL MINDANAO COLLEGE

Maranding, Lala, Lanao del Norte
COLLEGE OF EDUCATION
BUILDING AND ENHANCING NEW LITERACIES ACROSS THE CURRICULUM
TOPIC
FINANCIAL LITERACY
INTENDED LEARNING OUTCOMES
• Define financial literacy;

• Assess level of personal financial literacy using set of standards and questions;
• Characterize financial literacy in the Philippines; and
• Start practical steps to develop personal financial literacy
EDUC PCK 6
DISCUSSION
Finanncial literacy means the ability to read, analyze, manage, and communicate about the
personal financial conditions that affect material well-being. It includes the ability to discern
finanacial choices, discuss money and financial issues without or despite discomfort, plan for the
future, and respond competently to life events that affect everyday financial decisions, including
events in the general economy. – National Endowment for Financial Eduication
Or simply, it is the ability to use knowledge and skills to manage one’s financial resources
effectively for lifetime financial security”
According to Hastings financial literacy refers to as:

• Knowledge of financial products
• Knowledge of financial concepts
• Having mathematical skills or numeracy necessary for effective financial decision making
• Being engaged in certain activities such as financial planning
Why is it important for the public and private institutions to recognize the need for financial
literacy?
The Effects of
MODULE 4
Here the summarized standards and key concepts:
STANDARDS KEY CONCEPTS

EARNING INCOME • Income earned or received by
people
• Different types of jobs as well as
different forms of income earned or
received
• Benefits and costs of increasing
income through the acquisition of
education and skills
• Government programs that affect
income
• Types of income and taxes
• Labor market
•
BUYING GOODS and SERVICES • Scarcity, choice and opportunity cost
• Factors that influence spending
choices
• Comparing the cost and benefits of
spending decisions
• Basics of budgeting and planning
• Making a spending decision
• Payment methods, cost, and benefits
of each
• Budgeting and classification of
expenses
• Satisfaction, determinants of
demand, costs of information search,
choice of product durability
• The role of government and other
institutions in providing information for
consumers
SAVING • Concept of saving interest
• How people save moneys, where
people can save money, and why
people save money
• The role those financial institutions
play as intermediaries between
savers and borrowers
• The role of Federal Deposit Insurance
Corporation (FDIC) pay in protecting
savings deposits
• Role of markets in determining
interest rates
• The mathematics of saving
• The power of compound interest
• Real versus nominal interest rates
• Present versus future value
• Financial regulators
• Automatic saving plan
• Saving for retirement
MODULE 4
USING CREDIT • Concept of credit card and the cost
of using credit
• Why people use credit and the
sources of credit
• Basic calculations related to
borrowing
• Credit reports and credit scores
• Behaviors that contribute to strong
credit reports and scores
• Impact of credit reports and scores
on consumers
• Consumer protection laws
FINACIAL INVESTING • Concept of financial investment
• Variety of possible financial
investments
• Calculate rates return
• Relevance and calculation of real
and after-tax rates of return
• How diversification can reduce risk
• How financial markets react to
changes in market conditions and
information
PROTECTING AND INSURING • Concepts of financial risk and loss
• Insurance (transfer of risk through risk
pooling)
• Managing risk
• Identity theft
• Life insurance products
• How to protect oneself against
identity theft
THE BENEFITS OF FINANCIAL LITERACY
Financial literacy enables people to understand and apply knowledge and skills to achieve a
lifestyle that is financially balanced, sustainable, ethical, and responsible. Increased of personal
financial literacy affects one’s financial behavior.
Financial literacy does not totally eliminate the need for social safety net because even the
most prudent individual can encounter financial difficulties. Being financial literate create
proper decision-making skills and discipline in managing financial matters.
FINANCIAL LITERACY IN THE PHILIPPINES (Assignment)

MODULE 4
DEVELOPING PERSONAL FINANCIAL LITERACY
One’s attitude about money is heavily influenced by the parent’s attitude and behavior about
money. The attitudes you formed early in life probably affect how you save, spend, and invest
today.
How do you handle money?
There are six major characteristic types in how people view money (Incharge,2017)
FRUGAL: they seek financial security by living below their means and saving money
PLEASURE: they use money to bring pleasure to themselves and to others. More likely to
spend than save.
STATUS: some people use money to express their social status, purchase and “show off”
INDIFFERENCE: some people place very little importance on having money and would
rather grow their own food and craft their own clothes. Having too much money make
them nervous and uncomfortable.
POWERFUL: powerful people use money to express power or control over others
SELF-WORTH: people spend money for self-worth value how much they accumulate and
tend to judge others based on the amount of money they have
SPENDING PATTERNS
Before one can come up with a financial plan, one needs to analyze his/her spending habits.
There are two common spending patterns:
Habitual spending – one spends out of habit, when one buys the same item daily, weekly, or
monthly
Impulsive spending – one mindlessly purchases items that he or she does not need. Monthly sales
at the malls or etc, thinking they might lose the items the following day or not be able to purchase
it anymore
1. Fixed vs. Variable Expenses

Fixed expenses remain the same all year round, monthly dues; water and electric bills)
Which expenses are fixed and which are variable? Indicate the monthly total. Put a check mark
on the corresponding type.
Monthly total Fixed Variable

Food
Clothing
Gas
Medicine
internet
MODULE 4
2. Needs vs. Wants
Financial discipline starts with an ability to recognize whether expense are needs or wants,
and must be followed by the ability to prioritize needs over wants.
List down all expense that belong to the needs and those that belong to the wants.
Needs Wants
IMPORTANCE OF SAVING
o Emergency Bolster – to avoid going to debt just to pay emergency situations

(unexpected medical expenses and damages caused by calamities or accidents)
o Retirement – you need savings/investments to take the place of income you will no
longer receive when you retire
o Future Events – for future events like weddings, birthdays, anniversaries, and travels so as
not to sacrifice your fixed expenses
o Instability of Social Security – pensions from social security should only serve as
supplementary and not the primary source of income after retirement
o A little goes a long way – small consistent savings go a long way
You can either save before you spend or save after you spend wisely.
Develop a habit on saving:
1. Commit to a month;
2. Find an accountability partner;
3. Find savings role model who is successful with his/her money, through tried-and-true savings;
4. Write your goal and track it; and
5. Avoid tempting situations (hang-out to the mall, online selling)
MODULE 4
Performance Task
Choose 2 performance tasks only:
1. To enhance your financial literacy, do the following:
Setting Financial Goals

GOALS Action/plan (how you will do
it) this should be detailed
Short-term:
____________________________
Long-term:
____________________________
2. Developing a Spending and Saving Plan (ask permission first)
➢ Interview a friend, or family member (take a picture only of you and the interviewee)
➢ Ask how they spend and save money (discover their behavior, be creative when asking
questions, it should not limit to a yes or no answer)
➢ Choose any of the following forms: inforgraphic/ cartoon in presenting your output
3. Whatcha say?
➢ VIDEO
➢ Create a funny or comical presentation about the different types of reaction toward
a SALE advertisement. What would each type of person would likely say or react?
FRUGAL
PLEASURE
STATUS
INDEFFERENCE
POWERFUL
SELF-WORTH
Prepared by:
Isabelle L. Paiso, LPT

North Central Mindanao College

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MODULE 4

NORTH CENTRAL MINDANAO COLLEGE

INTENDED LEARNING OUTCOMES

• Define financial literacy;

According to Hastings financial literacy refers to as:

STANDARDS KEY CONCEPTS

THE BENEFITS OF FINANCIAL LITERACY

FINANCIAL LITERACY IN THE PHILIPPINES (Assignment)

How do you handle money?

1. Fixed vs. Variable Expenses

Monthly total Fixed Variable

o Emergency Bolster – to avoid going to debt just to pay emergency situations

o A little goes a long way – small consistent savings go a long way

Develop a habit on saving:

1. To enhance your financial literacy, do the following:

Setting Financial Goals

2. Developing a Spending and Saving Plan (ask permission first)

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