Standard 1: Earning Income. Income for most people is determined by the market value of their labor, paid as wages and salaries. People can increase their income and job opportunities by choosing to acquire more education, work experience, and job skills. The decision to undertake an activity that increases income or job opportunities is affected by the expected benefits and costs of such an activity. Income also is obtained from other sources such as interest, rents, capital gains, dividends, and profits.
Benchmark 1, Grade 8. Careers are based on working at jobs in the same occupation or profession for many years. Different careers require different education and training
Benchmark 2, Grade 8. People make many decisions over a lifetime about their education, jobs, and careers that affect their incomes and job opportunities.
Benchmark 3, Grade 8. Getting more education and learning new job skills can increase a person’s human capital and productivity.
Benchmark 4, Grade 8. People with less education and fewer job skills tend to earn lower incomes than people with more education and greater job skills.
Benchmark 5, Grade 8. Investment in education and training generally has a positive rate of return in terms of the income that people earn over a lifetime.
Benchmark 6, Grade 8. Education, training, and development of job skills have opportunity costs in the form of time, effort, and money.
Benchmark 7, Grade 8. People often use a portion of their savings to help themselves or their family members build human capital through education or job training.
Benchmark 1, Grade 12. People choose jobs or careers for which they are qualified based on the income they expect to earn and the benefits, such as health insurance coverage or a retirement plan, that they expect to receive.
Benchmark 2, Grade 12. People choose jobs or careers for which they are qualified based on non-income factors, such as job satisfaction, independence, risk, family, or location.
Benchmark 3, Grade 12. People vary in their willingness to obtain more education or training because these decisions involve incurring immediate costs to obtain possible future benefits. Discounting the future benefits of education and training may lead some people to pass up potentially high rates of return that more education and training may offer.
Benchmark 4, Grade 12. People can make more informed education, job, or career decisions by evaluating the benefits and costs of different choices.
Benchmark 5, Grade 12. The wage or salary paid to workers in jobs is usually determined by the labor market. Businesses are generally willing to pay more productive workers higher wages or salaries than less productive workers.
Benchmark 7, Grade 12. Taxes are paid to federal, state, and local governments to fund government goods and services and transfer payments from government to individuals. The major types of taxes are income taxes, payroll (Social Security) taxes, property taxes, and sales taxes.
Benchmark 8, Grade 12. People’s sources of income, amount of income, as well as the amount and type of spending affect the types and amounts of taxes paid.
Standard 2: Buying Goods and Services. People cannot buy or make all the goods and services they want; as a result, people choose to buy some goods and services and not buy others. People can improve their economic wellbeing by making informed spending decisions, which entails collecting information, planning, and budgeting.
Benchmark 4, Grade 8. Choosing a payment method entails weighing the costs and benefits of the different payment options.
Benchmark 5, Grade 8. A budget includes fixed and variable expenses, as well as income, savings, and taxes.
Benchmark 4, Grade 12. Consumers may be influenced by how the price of a good is expressed.
Standard 3: Saving. Saving is the part of income that people choose to set aside for future uses. People save for different reasons during the course of their lives. People make different choices about how they save and how much they save. Time, interest rates, and inflation affect the value of savings.
Benchmark 5, Grade 8. Principal is the initial amount of money upon which interest is paid.
Benchmark 8, Grade 8. Different people save money for different reasons, including large purchases (such as higher education, autos, and homes), retirement, and unexpected events. People’s choices about how much to save and for what to save are based on their tastes and preferences.
Benchmark 1, Grade 12. People choose between immediate spending and saving for future consumption. Some people have a tendency to be impatient, choosing immediate spending over saving for the future.
Standard 4: Using Credit. Credit allows people to purchase goods and services that they can use today and pay for those goods and services in the future with interest. People choose among different credit options that have different costs. Lenders approve or deny applications for loans based on an evaluation of the borrower’s past credit history and expected ability to pay in the future. Higher-risk borrowers are charged higher interest rates; lower-risk borrowers are charged lower interest rates.
Benchmark 1, Grade 8. People who apply for loans are told what the interest rate on the loan will be. An interest rate is the price of using someone else’s money expressed as an annual percentage of the loan principal.
Benchmark 2, Grade 8. The longer the repayment period on a loan and the higher the interest rate on the loan, the larger is the total amount of interest charged on a loan.
Benchmark 7, Grade 8. Lenders charge different interest rates based on the risk of nonpayment by borrowers. The higher the risk of nonpayment, the higher the interest rate charged. The lower the risk of nonpayment, the lower the interest rate charged.
Benchmark 8, Grade 8. People can use credit to finance investments in education and housing. The benefits of using credit in this way are spread out over a period of time and may be large. The large costs of acquiring the education or housing are spread out over time as well. The benefits of using credit to make daily purchases of food or clothing are short-lived and do not accumulate over time.
Benchmark 9, Grade 12. Consumers who have difficulty repaying debt can seek assistance through credit counseling services and by negotiating directly with creditors.
