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Decision-Making Through the PACED Model
Educator incorporates a rational decision-making model into instruction.
Key Method
The educator understands the need for rational financial decision-making and successfully models and guides
students through the PACED decision-making process.
Method Components
Steps of the PACED activity
§ Problem: State the problem that must be solved. This can be a teacher-created or student-generated
problem. One possible example for a personal finance course could be how a student wants to use
$500 they earned from a summer job.
§ Alternatives: Students develop and list several solutions for the chosen problem. The alternatives may
be chosen by the students individually or can be suggested and agreed upon by the members of the
class as a whole.
§ Criteria: Students select the criteria on which the alternatives should be evaluated. This is where the
students decide which values are important to them to ensure that their evaluation produces a
meaningful decision.
§ Evaluate: Students evaluate how well each alternative meets the chosen criteria. The ratings may be a
simple plus or minus, or a numeric system (1-5) may also be used.
§ Decision: Students make a decision based on the evaluations.
Suggested Implementation:
1. Begin the lesson by building a list of all the financial decisions the students make in the present and
will face in the next few years. Then, discuss the benefits of rational decision-making.
2. Introduce the PACED decision-making process by completing the process for a personal finance
decision in front of the class. Be sure to “think-aloud” while modeling (Rosenshine, 2012, p. 15).
3. As a class, choose a personal finance decision and prompt students to complete their own PACED
worksheet (See the resources section).
4. When students are finished, discuss the alternatives they chose and the criteria on which they
evaluated the alternatives.
5. Close out the lesson with a discussion or written response that asks students to think about the
benefits of making personal finance decisions with this framework.
Supporting Research
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Despite their young age, American teenagers are active players in the economy and have significant
purchasing power (“Purchasing Power of Teens”). Teens also face numerous important financial decisions as
they progress through high school and graduate, such as which career they will pursue, where they will live,
and choices about student debt.
Researchers have defined two levels of decision-making. System 1 decision-making is “fast, automatic,
effortless, implicit, and emotional,” while System 2 refers to “reasoning that is slower, conscious, effortful,
explicit, and logical” (Milkman, Chug & Bazerman, 2008, p. 3). System 1 decision-making can lead to poor
financial choices, so a rational approach to decision-making should be utilized in personal finance classrooms
(Krumboltz et al., 1986). The PACED framework is useful for students because it breaks the decision-making
process into distinct steps, and research shows that it is best to present information to students in small steps
and to assist them before moving on to the next step (Rosenshine, 2012). The PACED process also promotes
and encourages student choice throughout, and research shows that when students have some choice in
their instruction they perceive the activities to be more important and are more engaged (Goodwin, 2010).
§
Krumboltz, John D., et al. “Teaching A Rational Approach to Career Decision Making: Who Benefits
Most?” Journal of Vocational Behavior 29.1 (1986): 1-6. Research Gate. Web. 10 Apr. 2016.
http://bit.ly/1Ur5Aci
§
Goodwin, Bryan. “Research Says...Choice Is a Matter of Degree.” Educational Leadership 68.1 (2010):
80-81. ASCD. Web. 23 Apr. 2016.
http://bit.ly/S9bbGl
§
Rosenshine, Barak. “Principles of Instruction: Research-Based Strategies that All Teachers
Should Know.” American Educator (2012): 12-39. American Federation of Teachers. Web. 24 Oct. 2015.
http://www.aft.org/sites/default/files/periodicals/Rosenshine.pdf
§
Milkman, Katherine, Dolly Chugh, and Max H. Bazerman. “How Can Decision Making Be Improved?”
Harvard Business School. N.p., 2008. Web. 10 Apr. 2016.
http://www.hbs.edu/faculty/Publication Files/08-102.pdf
§
“Purchasing Power of Teens.” FONA International. N.p., 2014. Web. 24 Apr. 2016.
http://www.fona.com/sites/default/files/PurchasingPowerofTeens_TrendInsight_0514_0.pdf
Resources
Lesson Plans
§
Oklahoma State Department of Education. “Economic Reasoning.” State of Oklahoma. N.p., 2008.
Web. 25 Oct. 2015.
http://ok.gov/sde/sites/ok.gov.sde/files/PFLTchrGuideIntro.pdf
§
Economics Arkansas. “Tools for Teaching the Arkansas Economics and Personal Finance Course.” St.
Louis Federal Reserve. N.p., 2015. Web. 25 Oct. 2015.
https://www.stlouisfed.org/~/media/Education/Tools/pdf/EA-Tools-for-Teaching-Session-1.pdf
§
“Making Personal Finance Decisions.” Minnesota Council on Economic Education. N.p., n.d. Web. 25
Oct. 2015.
https://www.mcee.umn.edu/sites/mcee.umn.edu/files/mpfd-_units_one-ten.pdf
§
“Financial Fitness for Life: Shaping Up Your Financial Future Teacher Guide.” EconEd. Council for
Economic Education, n.d. Web. 25 Oct. 2015.
http://www.econed-in.org/lessons/FFFL 6-8 Teacher 02.pdf
2
Submission Guidelines & Evaluation Criteria
The items in this following section detail what must be submitted for evaluation. To earn the micro-credential,
you must receive a passing evaluation for Parts 1,3, and 4, and a “Yes” for both artifacts submitted for Part 2.
Part 1. Overview Questions
(200-word limit):
§
How did you connect personal finance decision-making to prior lessons in your class to build
students’ background knowledge and activate prior knowledge?
- Passing: Educator explains the specific steps of how they framed the topic of personal finance
decision-making, including connections to prior lessons and student comments.
Part 2. Work Examples/Artifacts
Submit one video that demonstrates your competence with modeling the PACED process with your class.
Also, submit two samples of student work that shows student engagement with the PACED process.
“Yes”
“Almost”
“Not Yet”
Video demonstrates the educator’s
effective explanation of the PACED
process. Student questions are
answered and the educator “thinks
aloud” while modeling the example
in front of the class.
Video demonstrates the educator’s
effective explanation of the PACED
process, but student questions are
not answered or the educator does
not “think aloud” while modeling
the example in front of the class.
Video does not demonstrate that
the educator understands the
PACED process. The educator
does not “think aloud” and
properly model the example for
the class.
The PACED organizers are
completed and show direct
engagement with the process. The
alternatives are listed and
evaluated based on the chosen
criteria, and a decision is specified
at the end.
The PACED organizers are
completed and show direct
engagement with the process. The
alternatives may be listed but they
are not evaluated based on the
chosen criteria, or a decision is not
specified.
Student samples are not fully
completed and do not show direct
engagement with the process. The
alternatives may be listed but they
are not evaluated based on the
chosen criteria.
Part 3. Student Reflection
Provide two written reflections from students who participated in activity used for submission of Part 2. Use
the following question as guidance (200-word limit):
§ How does the PACED process compare and contrast with the way you usually make decisions?
- Passing: Student responses clearly identify at least one similarity and one difference between the
PACED process and how they usually make decisions.
Part 4. Teacher Reflection
Provide a reflection on what you learned, using the following questions as guidance (300-word limit):
§ How can the PACED model help students make better financial decisions?
- Passing: The educator points to specific reasons as to why the PACED decision-making model is
beneficial for students.
Part 5: Survey (Optional)
Please answer a brief survey about your experience teaching personal finance. Your responses will
§ help us understand barriers personal finance teachers face; and
§ help us improve the resources being offered to personal finance educators
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https://www.research.net/r/GFLEC4DP1
We appreciate your help.
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