Evaluate what functional skills the students in your adult literacy class need the most. Do they live in a neighborhood where absentee landlords charge outrageous rents and don't make repairs? Is the neighborhood neglected by the city? Do parents know how to communicate effectively with their child's school? Is there a desire to gain meaningful employment, but confusion about how to go about doing so? Students will be the most engaged in your curriculum if it addresses skills that they believe they need.
Seek input from community members who will be attending the class. The Journal of Adult Education and Development points out that "revealed that literacy is not a single uniform competency which can be learned in a neutral environment and then applied to every situation." Your students will help you determine which "situations" need to be focused on.
Examine your current curriculum, if one exists. Look for places where additional content can be embedded. Is there a story about a person who has overcome odds to become employed? This is a good place to include lessons that teach how to fill out job applications and make resumes. Perhaps there is a story about college. Get copies of applications, course descriptions and schedules to work with in your class. Many of your students have probably not been exposed to higher education to the extent that they know which steps to take to get there. Your class can teach this important skill.
Are your students registered to vote? Look for an appropriate place in the curriculum to include information on civic responsibilities.
Invite guest speakers to your literacy class. College admissions officers, city officials, real estate agents---all of these individuals can make important contributions to your class. Keep in mind that literacy is not only about being able to read, but also about obtaining the knowledge required to live a full life.
Create your own curriculum if you don't have one, or if the existing one is outdated and irrelevant. This can be the most effective way to embed functional skills, because the curriculum will flow together, and you can incorporate stories and activities that are tailored specifically for the needs of the students in your community.