Morality and money: Relating character and values to financial education in grades K-4

Thomas A. Lucey Ed. D.
Assistant Professor
250 DeGarmo Hall
College of Education
Curriculum and Instruction
Illinois State University
Campus Box 5330
Normal, IL 61790-5330 USA
Fax (309)438-8569

Duane M. Giannangelo
The University of Memphis, Memphis, Tennessee

Jeffrey M. Hawkins
Oklahoma State University in Stillwater

Julia A. Heath

Michael M. Grant
The University of Memphis, Memphis, Tennessee

Keywords: financial education, moral education, child development


This study examines the inclusion of a moral component to teaching financial education to children in grades K-4. Comparisons were made between current financial education areas and suggested moral items. Morality was defined and measured by modifying items from the courtesy, generosity, and sportsmanship subscales of Bulach and Butler’s (2002) survey. The study found that levels of agreement with financial morality items were similar to the levels of agreement with the generally accepted areas. Findings must be extended to a larger sample for confirmation or refutation, using a more extensive measure of financial morality. The authors invite further examination into the prospect of developing moral tenets within financial education.

Morality and money: Relating character and values to financial education in grades K-4

Consider this situation: Three elementary-aged youth discuss what they did during the winter holiday. One student describes his or her experiences of staying at home and interacting in the neighborhood. A second student describes the annual family trip to a warmer climate or to a ski resort. The first student complains it is not fair that some people can go to exciting places all the time while others cannot. A third student enters the conversation and says that his or her family took a long trip to an amusement park during the summer and could not afford a winter trip because of credit card payments. The second student shrugs wordlessly.

This exchange informs each student about his or her social identity and shapes the student’s posture towards social challenges. The connections that these students make to each other, and society, depend on family incomes, spending choices, and credit usage. Absent mediation by an informed adult, this situation leaves these children to their own devices to reconcile their economic differences. Helping students to mature as financial consumers involves more than teaching them how to acquire, manage, and develop financial resources; it includes facilitating their discovery of how good citizens respect others and their financial decisions. Financial education must consider the moral issues resulting from contextual differences in consumer socialization. This paper interprets the agreement of K-4 educators with suggested moral components to financial education and compares them to their agreement with generally accepted components of financial education.

Moral education represents an important learning concern, particularly in early grades. During these years, children experience processes that shape their cognitive and behavioral habits. Recognizing that teachers have the professional abilities to employ developmentally appropriate practices that facilitate children’s learning, we addressed the following research question: Do teachers and administrators for grades K-4 agree that morality represents a financial education component with equal or more importance than the four established financial education areas (income, money management, savings and investments, spending and credit). In answering this question, we offer data to begin a conversation concerning the nature of financial education and related social responsibilities.

Morality and economics

The authors interpret morality as a pattern of thought (or policy) and action whereby one adds to or subtracts from another’s material or psychological well-being. While this understanding appears consistent with domain theorists who distinguish among moral issues, social convention, personal preferences, Smetana (2006) notes that children perceive similar situations differently. In other words, because of their different contexts, children value different aspects of situations, classifying them in different manners. These circumstances may relate to the context of the household, as Smetana observes that children readily acknowledge the moral issues associated with physical harm; however, she points out that children possess varying interpretations of abstract issues such as unfairness. These observations are consistent with the literature concerning the contextual nature of consumer socialization (e.g., Moschis 1985). Indeed, for children, reality may involve more complexity than fiction. Children tend to provide more vague interpretations of actual events, versus imaginary scenarios conjured up by researchers (Smetana 2006).  

Because of the challenges in differentiating social convention and moral action, the connection of morality to personal finance is nebulous. Minnameier (2004) recognizes that three approaches toward economically related moral theory exist: a principle-founded Kohlberg approach, a tolerant contextually awareness perspective, and a comprehensive holistic theory. He concludes that an ethical model requires an economic framework to reconcile individual and group directives. If morality represents a component of financial education, we must reconcile that situational conundrum.

Individuals.As individuals, children possess different biological factors that affect their patterns of moral development (Eysenck 1976). While Nucci (2001) observes that children distinguish between moral judgments (those involving hurt) and social convention (adherence to rules) very early in development, the lines between social convention and morality become blurred. While developing in various economic contexts that model different financial behaviors (Moschis 1985), children experience different forms of parental or familial influences that shape their moral development (Saltzstein 1976). However, these settings also foster patterned human judgments. Children intertwine interpretations of morality and elements of social or economic contexts.

Groups. Understanding morality becomes more complex as the conversation extends to groups. Garbarino and Bronfenbrenner (1976) observe that children morally develop through interactions with various social systems. They encounter increasing pressures from peers to modify behaviors toward group acceptance. Within groups, individuals make choices; however, their sense of responsibility becomes diffused in collective decision-making. Saltzstein (1976) observes that membership in a group involves an evaluation of one’s values in the context of others. As one increases his or her interaction with other group members, his or her vulnerability to influence by others increases (Saltzstein 1976).

Development with regard to intergroup judgments also represents a moral concern (Killen, Margie, and Sinno 2006). As research indicates that children tend to retain information about stereotypes more than “counter stereotypical information,” educators need to challenge the attitudes that children possess regarding different financial contexts. Killen, Margie, and Sinno observe that three patterns of intergroup judgments among children (outgroup homogeneity effect, shifting standards, and aversive racism) exist. Therefore, educators should be conscious that these patterns might involve economic reactions, such as employing stereotyped characteristics to members of particular social classes.

Educators must enable students to see and challenge the possible individual and group immoralities that may occur in a capitalist society and initiate classroom conversations about their remedy. Individuals should learn the responsibilities for moral conduct within both individual and group contexts, especially when these responsibilities run contrary to group actions. Working with youth to develop the self-esteem to resist unsavory group influences represents a possible method for doing so. Zimmerman et al. (1997) report that adolescents who possess higher or increasing amounts of self-esteem better resist peer pressure and deviant behaviors than those who possess lower or decreasing self-esteem. While we recognize that esteem may deter children who lack firm moral foundations and resist or experience rejection by groups espousing favorable moral values, elementary school educators have important roles in building children’s esteem and facilitating their discovery of moral thought and behavior tenets.

Moral involvement involves a five-step decision-making process (Huston and Korte 1976): notice, interpretation, responsibility, evaluation, and decision. Within group contexts, the individual faces dilemmas in all stages because other group members judge his or her response to these dilemmas. For example, the decisions made in a boy’s choir may differ from those on a football team. As Bobbitt (2002) illustrated with the Bosnia crisis of the 1990s, groups face these decision difficulties as well.

This individual-group dynamic represents an important decision-making imprint for children, if they are to mature into caring adult citizens. Within corporate (or group employment) settings, ethical challenges may be individual or group focused, or a combination of both. For example, an individual, such as Martha Stewart, is confronted with a decision about whether or not to sell company stock in the face of adverse insider financial information. An industrial giant may wrestle with choices between low-cost waste disposal dumping and an expensive reprocessing program. Finally, an executive may consider the consequences of marketing a product known to harm consumers’ health. We think that the five steps of moral involvement (Huston and Korte 1976) apply to moral decisions in general. Individuals should recognize the moral nature of their situation (notice), understand their choices (interpret), recognize the importance of their choices (responsibility); make informed interpretations about their conduct (evaluation) and follow-through on that interpretation (decision).

By teaching children the consequences for their decisions early in life, then extending these thought processes to their decisions within groups, financial educators may teach children that group involvement does not dissolve individual responsibilities for moral decision making. These moral ideas relate to all four of the financial education areas. Concerning income, children should consider the nature of their future employment or entrepreneurship, discussing both the costs and benefits to their local and extended communities. Regarding money management, children should evaluate financial relationships with companies that employ child labor, lack management diversity, or pollute the environment. Regarding spending and credit, it is important for children to understand the motives and consequences for their spending decisions. For example, one might reward good behaviors with donations to a charity, rather than the acquisition of a new toy. Concerning savings and investments, children should understand the community reinvestment and fair lending obligations of financial institutions, how their savings accounts support such efforts, and their responsibilities in choosing institutions that manage their deposits.

Child development

Early childhood presents significant economic moral challenges through inundation of commercial pressures to develop brand loyalties. Holst (1999) remarks that brand goods impair children’s creativity development. Children make judgments about other children based on their patterns of interest and ownership in games, toys, and other material goods. According to Holst, commercial goods limit creativity to the corporate manufacturers’ ideas. She observes that these constraints limit social acceptance of those with low quantities of economic resources, arguing that unbridled provision of these objects reduces children’s self-discipline.

Within Kohlberg’s (1976) six-staged framework of moral thinking, material dependency arguably prompts a lower moral stage of thinking. Through a materialist mindset that espouses acquisition of goods for satisfaction, children perceive a system of rewards for good behavior and penalties for negative conduct that limits their potential to think of alternative means for fulfillment. As both individuals and groups represent composite patterns of moral and immoral thoughts and actions, the challenge for educators lies in enabling students’ recognition of potential for challenges, facilitating discussions about these possibilities, and enabling their discovery of moral conduct that considers the views of all who are affected. In considering examples of those who attained Kohlberg’s Stage 6 of self-chosen ethical principles such as Mahatma Gandhi, Martin Luther King, Mother Teresa, and Jesus of Nazareth, we argue that optimal moral thinking challenges society’s economic conventions and associated institutional structures.

Child understandings appear to lack a theoretical framework that relates economic contexts to patterns of moral development. Bergman (2002) synthesizes the theories and research of Piaget, Kohlberg, Rest, Colby, Damon, and Blasi into a model of moral development. His model depicts childhood as a period of structuring ideas of self and morality into patterns of identity that serve as bases for moral conduct. Yet such a model only brushes the environmental relationships on child development. If moral development shapes individual identity within a context of environmental influences, economic contexts have some bearing on these processes.

Research indicates that contexts affect children’s rationalizations of economic differences in society (Furby 1979). These contexts also affect children’s judgments about consumer purchases (Moschis and Moore 1978). Children possess the abilities to distinguish morality from social convention (Tisak and Turiel 1988, Nucci 2001) and from sound entrepreneurship (Siegler and Thompson 1998). Educators should consider the benefits of extending children’s abilities to discuss conflict (Bickmore 1999) in classroom conversations about financial choices and their affects on human welfare. Discussions about financial morality should relate to the different systems covered within curricula, including personal, organizational, and governmental. Such processes offer children tools to gather information and make informed decisions about the choices that they will make as adults.

Moral aspects of financial education should include both societal and individual considerations. Students must understand the consequences for their employment, consumer, and investment decisions. For example, maintaining deposits with banks that do not invest in their locales presents a problematic situation for those who wish to revitalize their communities. Yet as members of societal groups, students must also become sensitive both the group and individual consequences of decisions. Thomas (1993) explains that moral deference represents a critical step in building mutual trust and support among societal groups. By facilitating conversations about these issues within their classrooms and with others, teachers may enable students to understand the various dimensions of these issues and comprehend the various perspectives others might possess.

Affecting social justice requires employment of procedures that are respectful to all participants (Tyler and Blader 2003, de Cremer and Tyler 2005). Deciding whether (or how) financial education should address these contextually patterned judgments presents important societal consequences. Because moral interpretations depend on the perspective of the respondents, educators must teach children to respect the views of people of all financial circumstances, and employ such processes when considering moral choices within both individual and group contexts. A moral component to financial education could bridge this curricular gap. To commence discussions about this topic, we describe a study addressing the following research question: Do teachers and administrators for grades K-4 agree that morality represents a financial education component with equal or more importance than the four established financial education areas (income, money management, savings and investments, spending and credit)?


This survey of K-4 teachers and administrators measured their agreement with a hypothetical moral component of a financial education curriculum for grades K-4. The respondents were employed by three school districts in the southern United States.

The full data collection occurred from January through April of 2004. The primary author employed a random process to choose four elementary schools from the urban school district and two elementary schools from each of the other two districts. Because of the low response rate from one of the urban system’s schools, the data were collected from an additional school, selected through the same random process.

Sample. The 2004 data collection involved five elementary schools from the urban school system and two elementary schools from each of the other two systems. The sample consisted of 167 rural and 93 urban educators (total 260), of which most (213) were teachers. The sample’s ethnic composition consisted of 174 Caucasian, 63 African-American, 12 members classified as “other”, and 11 undisclosed. There were 24 males, 228 females, and 8 respondents of undisclosed gender. Ninety percent of respondents’ household incomes ranged from $20,000 to $99,999. One percent had household incomes less than $20,000 and 9 percent had household incomes of more than $100,000.

Instrument. Data were collected using the Financial Literacy Topic Inventory (FLTI). The instrument instructed respondents to indicate the degree to which they agreed that students should know the topics after completing grade 4. The instrument contained 34 potential financial education curriculum tenets; 21 of these items represented the four components of financial literacy (income, money management, spending and credit, and savings and investment). The items for income, money management, and spending and credit were taken verbatim from the Jump$tart Coalition’s (2001) revised grade 4 financial curriculum benchmarks. Each item was structured as a 5-level Likert-style response, ranging from Strongly disagree (1) to Strongly agree (5). Seven items measured moral tenets, and six items related to technology awareness.

A list of nine proposed economic morality items concerning personal, organizational, and governmental topics was submitted to three experts for review. Bulach and Butler (2002) reported that elementary students required character education in three areas: courtesy, generosity, and sportsmanship. Bulach and Butler reported Cronbach alphas of .96 to .97 for their instrument. The FLTI items measuring financial morality were based on items contained in these areas. Two of the experts responded. One taught a course in psychology of moral development at an urban southern university; the other was a former school administrator and retired college professor from a rural southern university. The experts generally agreed with the content, recommending phrasing changes. Based on expert feedback, two items were eliminated because they were vague, redundant, or too complex for children in grades K-4. Items were also revised to include the clauses “should” or “should not”.

Two pilot trials during the fall of 2003 determined that five items were inconsistent with their respective subscales. The wording on five items was changed. During the full data collection, from January through April 2004, the instrument was administered in twelve educational settings. During this period, 363 surveys were distributed with 260 returned for a response rate of 71.6 percent. Table 1 presents the subscales’ reliabilities.

Table 1: Reliability coefficients (α)

Item Full administration
(N  = 194)
Income .65
Money management* .73
Savings and investments .75
Spending and credit* .56
Morality .68

* Highest alpha removing one item from the scale.


The data were analyzed through three dimensions: descriptive statistics, agreement rates, and item responses. Thorndike (2005) considers interpretation of instruments to be consistent with other measures. At the time of the instrument’s construction, there were not any discovered measurements of financial morality. Alphas of .60 were considered as acceptable because of small number of items in each subscale. In presenting findings, the spending and credit subscale was excluded, as its inter-reliability rating was not interpreted as being higher than accomplished by chance. As a result, the study compared respondents’ agreement with morality to remaining financial education areas: income, money management, and savings and investment.

Descriptive statistics. The first comparison interpreted descriptive statistics expressing respondents’ agreement with morality and the three measured components of financial education. Table 2 contains the statistics associated with this analysis.

Table 2:  Descriptive statistics for measured areas of financial education (N = 194)

Item ÎĽ SD Skewness
Morality 4.11 0.47 -0.32
Income 4.11 0.48 -0.07
Money management 4.26 0.58 -0.56
Savings and investment 4.15 0.49 -0.51

Interpretation of descriptive statistics. The statistics in Table 2 indicate that respondents recognized the importance of financial morality to the same degree as the least agreed upon financial area. Respondent comments such as “Children need to know about responsibility in money decisions. They need to see how their decisions affect their lives” and “These are excellent skills/topics for all students to learn and know for society!” indicated a general agreement with morality’s relevancy to financial curricula.

Agreement. The second comparison interpreted the agreement rates for financial morality and the three measured components of financial education. Table 3 presents the associated statistics.

Table 3: Agreement rates for measured areas of financial education (N = 194)

Item Strongly agree or Agree Neutral Disagree or Strongly disagree
Morality 91.20 8.30 0.50
Income 92.80 6.70 0.50
Money management 89.70 9.80 0.50
Savings and investment 90.70 9.30 0.00

Interpretation. The statistics presented in Table 3 suggest that respondents agreed to large degrees with items representing each financial education component. Respondents’ mean agreement with items in the money management subscale was greater than their agreement with the morality subscale; however, smaller percentages of respondents agreed with items in the money management subscale. When agreeing with items, respondents strongly agreed with money management items more than they did with items on the morality scale.

Morality items. The final comparison interpreted the descriptive statistics for items contained in the morality subscale. Table 4 presents the statistics associated with this analysis.

Table 4: Agreement indicators for each morality item (N = 194)

Item ÎĽ S.D. Skewness
Children should be courteous and
polite when buying things.
4.49 0.67 -1.38
Businesses should maintain
safe communities.
4.05 0.75 -0.54
People of all economic conditions should
have equal rights to basic goods and
services, like health care and education.
4.30 0.78 -1.23
Rich people should understand the needs
and concerns of poor people.
4.03 0.82 -0.51
Developing and following a spending
plan should be more important than
acquiring things.
4.11 0.77 -0.75
The products purchased should not
affect one’s human worth.
3.95 0.89 -0.62
Entrepreneurs should be more concerned
with honesty than profits.
3.82 0.87 -0.54

Interpretation. The statistics presented in Table 4 indicate that, on average, respondents agreed with the items representing the moral component. The skewed distribution of responses associated with items concerning children’s behaviors and equal economic rights illustrates the high agreement. The item concerning children’s shopping behavior prompted the highest amount of agreement. The items affirming humanity and integrity issues versus wealth accumulation prompted the lowest agreement. These findings indicate that respondents appreciate behavioral tenets and conceptual equality; however, they consider connections of ownership and morality as less appropriate for children of this age.


The educators’ agreement with the morality items approximated their agreement with established financial education areas. While results need duplication with broader measures and samples that are more diverse, this study’s findings suggest that the nature of financial education should be closely examined. In addition to teaching children the processes of financial acquisition, management, and development, it is important to also consider the merit of teaching the processes of community and societal dialogue, and the associated skills of listening to and affirming the merits different viewpoints, regardless of the economic contexts.

The findings provide an indicator of educators’ agreement with moral tenets of financial education. Higher means were associated with items advocating individual behaviors or ideals than those relating material acquisition to moral conduct. These patterns connect with ideas expressed in Kozol (2005). While conduct expectations represent important learning objectives, they lack meaning unless accompanied by situational examples that illustrate the reasons for their appropriateness. Just as teenagers should recognize the presence of curfews for their own safety (instead of fearing parentally imposed rules), children should recognize the moral merits associated with financial restraint, human acceptance, and equity-based community for the good of their classroom, local, national, and international communities.

This distinction relates to Minnameier’s (2004) effort to reconcile individual and group-based moral theories. Stronger agreement with items associated with individual conduct or societal convention indicate that respondents have different moral expectations of individuals and groups. Familiarity with a person or group arguably relates to the tolerance of sensitivity to its experiences. Additional research needs to examine the connections between corporate influence and individuals’ interpretations of corporate morality.


These findings indicate that K-4 educators agree with elements of financial morality to a similar degree as generally accepted financial education areas. While the authors recognize that moral learning occurs informally, formal classroom efforts should facilitate respectful discussions about these issues to provide students with opportunities to consider the many perspectives of them that they have (or lack!). Future studies should expand this interpretation of financial morality to consider the breadth and depth of associated topics. Through such processes, it may be possible to examine the economic connections to individual and group aspects of morality.




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Cite this article

Lucey, Thomas A., Giannangelo, Duane M., Hawkins, Jeffrey M., et al. 2007. Morality and money: Relating character and values to financial education in grades K-4. The Forum for Family and Consumer Issues, 12 (2).




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