Category: Chart of the Week

Interactive: What Happens To Risk When Your Investing Period Lengthens?

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Aug 08, 2017
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Investing, Chart of the Week, Question of the Day
From Of Dollars and Data: Over 1 year periods, markets can be very chaotic for both U.S. bonds and U.S. stocks. This is also true over shorter time horizons (i.e. monthly, daily, intra-day, etc.). However, the chaos fades as the time horizon increases. Below is an animation I created that shows the S&P 500 and U.S. 10-year Bond returns as they vary from a 1-year horizon to a 30-year horizon. Here are two charts from his animation (it changes before your eyes if you cilck on the link above):...

Chart: How Well Do Students Estimate The Monthly Payment On Their Student Loans?

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Aug 02, 2017
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Student Loans, Paying for College, Research, Chart of the Week
Answer: No real surprise here. They are abysmal at it. Here’s an explanation of this scatter plot (see below) from the recent Sallie Mae report on How America Pays for College: Separately, students seem not to be fully cognizant of how much they will repay. Students were asked to estimate their future monthly student loan payments based on the amount of loans they currently have. Similarly to 2008, a scatterplot of responses indicates little correlation between the amounts students...

Interactive: Taking A Skills-Based Approach To Careers

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Aug 01, 2017
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Career, Research, Current Events, Chart of the Week, Interactive
Ask a student what they would like to be when they grow up and you often get a quizzical look along the lines of “How should I know since I have never had a job?” The interactive tools below help you circumvent this by having students identify their skill preferences in jobs which will lead to a list of jobs that match these preferences. A second step in this activity helps students identify jobs that require skills similar to the ones they selected in step one. Taking this...

How is Personal Finance Being Taught in U.S. High Schools?

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Jul 31, 2017
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Current Events, Research, Chart of the Week
Here’s a word cloud created by our research team based on their analysis of personal finance course descriptions at almost 10,000 high schools (the larger the font of the word, the more frequently it occurs): A few observations: Where is personal finance incorporated in the curriculum? You can see that “business,” “economics,” and “consumer” are some of the more prominent words suggesting that they are embedded in these courses. What are the most...

Chart: What Is Risk?

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Jul 30, 2017
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Chart of the Week, Research, Index Funds, Investing, Current Events
From Vanguard: I love this chart because it provides such a clear relationship between risk and return. You want more risk (say 100% stocks), well you better be prepared for great years (54.2% was the best year from 1926-2013) and be able to stomach big down years (down 43.1%) without hopping out. It also demonstrates the most important decision that an investor will make is their asset allocation or their split between stocks and bonds. Note also that stocks here doesn’t refer to picking...

Question: Are College Costs Rising?

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Jul 23, 2017
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Chart of the Week, Paying for College, Question of the Day, Research, Current Events, Math, Economics
From WSJ (Subscription required): Questions for students: Create a one sentence description for the trends seen in each of the two graphs. A friend says, “What a bummer that college costs keep rising at an incredible rate!” Using the data from the graph on the left, provide a response to her assertion. Since 1990, all consumer prices (aka the rate of inflation) have basically doubled. Using the rule of 72, make an estimate as to what the inflation rate has averaged from 1990-2016....

Question: How Does America Pay for College?

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Jul 20, 2017
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Current Events, Question of the Day, Research, Student Loans, Teaching Strategies, Chart of the Week
Good bell ringer to get the conversation started about paying for college. Can start the class by asking your students how they think families will pay for college: What are the sources that families tap into? What are 3 most important categories? Once they have given their answers, you can move on to the chart below. Sallie Mae out with their tenth annual study showing how families are covering the cost of college. Lots of interesting graphs, charts, infographics that I will be sharing over...

Question: How Risky Is The Stock Market?

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Jul 20, 2017
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Behavioral Finance, Question of the Day, Research, Index Funds, Investing, Stocks, Chart of the Week
Answer: It depends on your time horizon. Short term, it’s risky. Long-term, not so much. Great chart here (from Barclays) demonstrates how your probability of making money (“gains”) in the stock market increases the longer your time horizon: “This chart shows the proportion of gains and losses we observe for the same investment (the MSCI World Developed Equities Index) as we change our monitoring horizon from 1 day to 5 years:” Let me explain: First, the MCSI...

Question: Why Are So Many Successful People College Dropouts?

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Jul 19, 2017
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Entrepreneurship, Research, Current Events, Chart of the Week
Answer: As the data below shows, most successful people are NOT college dropouts. Jobs, Gates, Zuckerberg. I imagine you’ve heard just a few students over the years come in and question the value of going to college by noting that these great tech innovators left their college before graduating (Reed College, Harvard and Harvard respectively). Well, now you have some data to counteract this myth of the successful college dropout (hat tip to CB Insights who included this chart in their...

Question: How Are Consumers Looking To Improve Credit Scores?

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Jul 17, 2017
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Credit Scores, Activity, Question of the Day, Current Events, Chart of the Week, Activities
A great bell ringer to see how many answers your students come up with before you reveal the answers (memories of the Family Feud). From US News and World Report survey: ___________ Looking for an engaging credit score activity (#1 on Google when you search for “engaging credit score activity”)? Here are our two favorites that work well together: Estimating a FICO Score  Use an online FICO credit score estimator to compare the credit scores of three hypothetical college students...

Interactive: What Does $1,500 In Monthly Rent Buy You in Different Markets?

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Jul 11, 2017
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Interactive, Question of the Day, Research, Budgeting, Chart of the Week
Visual Capitalist provides a great interactive tool for your students to see the wide disparity in the cost of living as seen through rental costs: With rental prices across the country continuing to rise from this demand, there is one question on the minds of many Americans: how and where can dollars spent on housing be stretched the furthest? Why is this important to know? Largest cost item for young people living on their own will be that monthly rent check so they better have a realistic...

Question: Why Should Investors Diversify Their Investments?

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Jul 06, 2017
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Chart of the Week, Research, Index Funds, Investing, Math
This chart reminded why diversification makes a whole lot of sense (hat tip to Big Picture Blog for highlighting it): Let me explain: Each asset class is represented by a different color Purple = Emerging Market stocks from developing economies like Brazil, Russia, India and Blue = Small Capitalization (or Small Cap) U.S. Stocks Dark Gray = International Stocks (from developed economies like Germany, England and Japan) Red = Real Estate Investment Trusts (REITs) Orange = Large Capitalization...

Interactive: Is The Career That You Are Interested In Likely to Disappear?

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Jun 28, 2017
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Career, Question of the Day, Research, Current Events, Chart of the Week, Employment
Lots of insightful and sobering interactive resources on this topic of job automation (see here, here and here for additional NGPF resources on this topic). Here’s another from Bloomberg (hat tip to Hari of NGPF and Big Picture Blog): Quick orientation:  This chart is static, click on the Bloomberg link to use its interactive features X axis is the probability that job will be automated in the future Y axis is the average annual salary for a given job Size of bubble is number...

Chart: How Are Millennials Investing Their Money?

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Jun 27, 2017
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Chart of the Week, Question of the Day, Research, Personal Finance, Investing, Stocks, Current Events, Math, compound interest
Hat tip to The Reformed Broker for this thought-provoking chart which will get your students thinking about the importance of asset allocations: Questions for students: Note: Equities are synonymous with stocks, fixed income means bonds, think of cash as a savings/checking account and alternatives would be alternative investments like hedge funds or private equity. What are the top four assets that millennials are investing in? Now rank the assets from highest to lowest historical return....

Question: Will You Own A Car in the Future?

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Jun 22, 2017
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Article, Question of the Day, Research, New Products, Purchase Decisions, Current Events, Chart of the Week
Interesting WSJ article (subscription) highlights how dramatically the concept of car ownership is changing in light of current ride-sharing trends and the potential for autonomous vehicles in the future. Here’s a graph that shows how new car buying has slowed dramatically among younger Americans: Other key points from this article (about a 5 minute read): 1/4 of miles driven may be through shared, self-driving vehicles by 2030: “Car ownership, for a long time, has symbolized...

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