The Coat Hanger Principle

Posted by Kendall on 15 July 2009 | 0 Comments

When teaching financial literacy, educators often struggle to identify a unifying principle that ties all of the pieces together. After speaking about this with teachers across the country, we've come to realize that budgeting concepts fill this role perfectly. We're so sold on this idea that we even have a name for it: "The Coat Hanger Principle."

You see, budgeting can serve as a sort of a "coat hanger" in your curriculum. All the other principles of financial literacy can be made to hang off of it. These concepts apply no matter what curriculum your state requires.

Cars, Insurance, Credit Scores, Oh My!

As students work through assignments and materials related to creating and living by a budget, seek to draw in other financial literacy subjects. For example, if you instruct students to budget for ownership of a car, you can use The Coat Hanger Principle to teach them about topics such as auto loans, liability insurance, and even credit scores. 

Cash Flow 

The Coat Hanger Principle isn't just about convenience in teaching. It rightfully emphasizes cash flow management as the central tenet of financial literacy. Students can be conversant about everything from insurance to credit card debt, but if they aren't living by a budget no other knowledge can save them. Furthermore, students experience better learning outcomes when financial literacy topics are taught cohesively, rather than as separate units.

Scenario Discussion Guide 

If you happen to be using Banzai's Life Scenarios in your classroom today, we've made it easy to implement The Coat Hanger Principle. Our Scenario Discussion Guide relates each individual scenario to a variety of financial literacy principles that may be part of your curriculum. By using budgeting as a centerpiece of your lessons you emphasize what's most important and tie it all together in a way that your students can understand.

We've heard from hundreds of teachers across the country, but have we heard from you? Let us know what you think about The Coat Hanger Principle, Banzai, or financial literacy in general! Send us an email at support@teachbanzai.com or give us a call at 888-8-BANZAI. We're always happy to hear from you.