Speculation in “The Devil and Tom Walker”


This is part 3.  In part 2 of Teaching Kids Financial Literacy through Great Literature: “The Devil and Tom Walker,” we learned about payday loans, predatory lending, understanding interest rates, and the danger of taking financial shortcuts. In part 1, we discussed Tom Walker, the literary figure and financial symbols. In the third and final part, we’ll look at avoiding two financial pitfalls: credit cards and speculation. I’ve included one of my favorite financial education lesson plans of all time, the speculation game.


ELA Common Core Standards Covered

Teaching “The Devil and Tom Walker” and financial literacy covers the following ELA common core standards for reading and writing.

  1. RL.9-10.1 Cite strong and thorough textual evidence to support analysis of what the text says explicitly as well as inferences drawn from the text.
  2. RL.9-10.2 Determine a theme or central idea of a text and analyze in detail its development over the course of the text, including how it emerges and is shaped and refined by specific details; provide an objective summary of the text.

Financial Principle #5: Avoiding Credit Card Debt

Teaching kids financial literacy starts with responsible spending.

In comparison to payday loans and predatory lenders, credit card terms seem quite mild. Of course in comparison to getting your limbs ripped off by sharks, drowning seems mild too. Show students how a $1,000 credit card balance making minimum payments takes years and more than triple the initial dollar amount to pay off. Go over a credit card agreement with them and explain the terms.

Of course, Tom Walker could not have made as much money, if the citizens of Boston weren’t such eager speculators.

Financial Principle #6: You Are Responsible

Teaching kids financial literacy continues with risk management.

Irving records, “there had been a rage for speculating; the people had run mad with schemes for new settlements; for building cities in the wilderness; land jobbers went about with maps of grants; and Eldorados, lying nobody knew where, but which everybody was ready to purchase.” This story could have taken place this decade just as well as in Irving’s times. With some classes, explaining recent real estate trends makes the point, especially if they’ve been kicked out of their house. With all classes, a game of speculation makes a stronger point.

“The Devil and Tom Walker” Lesson Plan: Speculation Game

Have fun with this financial literacy lesson plan.

  1. Give each student a chart with five columns: current amount, amount risked, win/loss, gain/loss, amount left.
  2. Tell each student he or she has $10,000 with which to speculate.
  3. Put 6 green markers and 5 red markers in a bag.
  4. Instruct students they will be risking a certain amount before each marker pull.
  5. Have students write down the amount risked before each pull.
  6. Pull a marker. If it’s green, every student wins; if it’s red every student loses.
  7. Repeat 15-20 times.
  8. Adjust the number of markers (without telling students) until enough go bankrupt to prove your point.

This Financial Literacy Lesson Plan is not only fun, it teaches a very important lesson on speculation and due diligence

Conclusion

The Devil came for Tom Walker while he was attempting to foreclose on a farm. Everything Tom had owned disappeared, all his bonds and mortgages reduced to cinders. Irving warns “let all griping money brokers lay this story to heart.” Today’s headlines demonstrate that “griping money brokers” have not taken this story to heart, but your students will. In fact, several students have made copies of the story and delivered it in person to payday loan centers. When confronted, they simply replied, “The devil made me do it.”

Short Story Guides

Teaching the Reading Literature Common Core Standards are easy with short stories.

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