A Complex Approach to Time Value of Money in Middle School Math

This research project addresses the challenge of understanding how middle school students (Grades 6 to 9) in Ontario develop an understanding of the Time Value of Money (TVM) and how this understanding supports the development of citizenship competencies. The recent changes in Ontario's mathematics curriculum emphasize financial literacy, making it critical for students to grasp financial concepts like TVM, which is the idea that a sum of money today is worth more than the same amount in the future due to its potential earning capacity. As financial systems grow increasingly complex and economic challenges such as inflation, housing costs, and climate change become more pressing, it is vital that students acquire the skills to navigate these realities. TVM is not only a financial concept but also a tool for developing critical thinking and decision-making skills, which are essential for active citizenship. Therefore, this research aims to explore how TVM can be integrated into mathematics education to support both financial literacy and civic participation.

The project is grounded in a theoretical framework that combines financial, mathematical, and mathematics education perspectives to explore TVM. From a financial perspective, the framework examines the three functions of money (store of value, medium of exchange, and unit of account) to understand how money's value changes over time. From a mathematical perspective, it draws on measurement theory, distinguishing between representational measurement (assigning a numerical value to an attribute) and pragmatic measurement (the construction of value through multiple factors). Finally, from a mathematics education perspective, the study employs a relational paradigm, which focuses on TVM as a system of interconnected relationships, such as additive, multiplicative, and exponential, rather than as isolated formulas. This approach helps uncover how students develop a deeper understanding of financial concepts and how such understanding can foster citizenship competencies.

The objectives of the study are to: 1) Identify the connections that students make between different mathematical concepts and the time value of money (TVM); 2) Investigate how middle school students (grades 6 to 9) develop an understanding of TVM in different grades; 3) Study how understanding TVM supports the development of citizenship among students.

This research makes significant contributions to the field of mathematics education and financial literacy by providing a comprehensive understanding of how students make sense of TVM across different grades. The study offers insights into the effective teaching of financial concepts, moving beyond the memorization of formulas to a deeper, more conceptual understanding of TVM. By examining TVM as an overarching concept that encompasses simple and compound interest, inflation, appreciation, and depreciation, the project fills a gap in existing research, which has often treated these topics in isolation. The findings are particularly valuable for informing curriculum design, teacher education, and professional development, offering practical strategies for integrating financial literacy into mathematics education. Furthermore, the project highlights how learning about TVM can support the development of citizenship competencies, preparing students to become informed and responsible participants in society. Ultimately, this study fosters financial literacy and citizenship, equipping students with the skills needed to navigate an increasingly complex financial landscape and contribute to their communities.