Raising Entrepreneurs

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Unlike their parents, a majority of young Americans say they plan to save for items on their wish list instead of paying with plastic, according to a new poll by financial literacy Web site www.themint.org.

In the survey, visitors to the site were asked what they would do if they spotted a great item at the mall that they couldn’t afford. More than half of respondents aged 29 or younger (54 percent) said they would put aside money each month until they had the full amount to buy the item. An even greater majority of kids aged 17 or younger (57 percent) agreed, saying they would save. In comparison, only 42 percent of adults aged 30 and above said they would save in advance.

“Kids today could become the most money smart generation since the 1940s,” said Meridee Maynard, financial literacy expert and senior vice president, Northwestern Mutual. “April is Financial Literacy Month, and like no other time in recent history, kids and parents alike recognize the importance of managing money. We learn money habits during childhood, and in these challenging economic times, kids are learning why saving can be sweeter and safer than paying with plastic.”

History shows that challenging times can affect personal saving behavior. In the early 1940s, during the Great Depression and World War II, the U.S. personal saving rate soared above 25 percent1. From 2005 to early 2008, that rate hovered between zero and one percent, and even became negative for one quarter (Americans spent more than they earned). But in mid-2008, the savings rate spiked, jumping to over three percent by year-end. And in January 2009, the savings rate jumped to five percent, the highest rate in 14 years.

Kids More Cautious with Credit Cards

The new poll results also indicated that kids are more cautious and measured when it comes to using credit cards. Only seven percent of people aged 29 or younger said they would use a credit card to purchase an item that they couldn’t afford. Of those 17 or younger, six percent indicated they would pay with plastic. In contrast, 13 percent of adults aged 30 and above said they would “charge it” and figure out a way to pay off the debt at a later date.

“If the current generation of young people pays close attention to the downsides of debt, the lessons learned from this recession could provide dividends for a lifetime,” said Maynard. “Low savings rates and high debt helped contribute to the financial challenges we’re seeing today. This financial environment offers engaging opportunities to teach kids about how money works and how to manage it wisely.”

Testing IQ to Avoid the Credit Card Trap

Kids can test their borrowing brainpower by taking the Credit Card IQ quiz on themint.org. Seven questions help to identify their knowledge of credit, and areas for improvement.

Maynard has five credit card tips for parents to share with their children:

1. Pay in full, on time, every month. Always pay off the balance monthly and avoid charging more than you can pay off monthly. Late penalties are costly, and some companies increase the interest rate after one or two payments are overdue.

2. Be aware of rates and fees. Credit card companies often offer low introductory rates to attract new customers. These rates typically last for only a few months and then jump as high as 20 percent. Also be aware of extra fees associated with pre-paid cards, such as activation, maintenance and late fees.

3. Don’t exceed your credit limit. This helps avoid penalties and ensures that you will have credit available in the event of a true emergency.

4. Protect your history. As soon as you start using a card, the payments – whether paid on time, late or not at all – become part of your credit history, which can affect your ability to rent an apartment, get a job, or buy a car or a house. Bad marks stay on a cardholder’s credit record even if the bill is paid later, so make sure to keep it clean.

5. Review your statements. Immediately inform the credit card company of any errors on the monthly statement.

Lindsay Kelbe, a Victor Senior High School student, is “really into fashions,” and hopes someday to have her own fashion business.

The Young Entrepreneurs Academy that this 17-year-old junior is participating in after school is giving her a taste of the business world.

Whether or not there’s the next Bill Gates among them doesn’t seem to matter.

“Be proud of what it is you are doing. Have that passion,” said art teacher Nancee Sanders, who is helping run the academy.

Plenty of enthusiasm was evident at the first of these weekly Tuesday sessions. The group also meets every other Thursday after school for field trips or to hear presentations from members of the local business community.

Sanders told how, when she was 8 growing up in Livingston County, she ventured into the business world, selling coffee and cake to ice fishermen on Conesus Lake.

Many of the students came to the class with ideas of what they wanted to accomplish.

“I want to make jewelry from recycled materials,” said Ricca Prasad, a 17-year-old junior from Victor.

Money made from the sale of this jewelry, Prasad went on to explain, could help survivors of the genocide in Darfur. She said she would work through an international group.

At least several of the students have already dabbled in the business world.

Ninth-grader Ford Filer fixes computers and, in case anyone wonders if he’s too young to do the job, he has his own business card: “Ford Filer, F2 Technical Solutions.”

The 14-year-old wants to form a “geek squad,” offering computer services cheaper than his grown-up competitors.

Meanwhile, Billy Boyce, a 17-year-old senior from Farmington, is eager to help his dad expand the family’s farm.

Source: Democrat and Chronicle

Nehemiah Walker, a 17 year-old student from Capitol Heights started his business, Freedom of Expression Photography, due to a passion for his art and a belief that he could deliver a quality product for a reasonable price. Seventeen year-old Jordan Jackson of Upper Marlboro started his business, Original State of Mind LLC, because of his painting talent and a desire to use products that promote environmental friendliness.

These two student entrepreneurs, along with 22 others like them from the District of Columbia, Maryland and Virginia, showcased their companies and networked their businesses to the D.C. area business community during The National Foundation for Teaching Entrepreneurship’s Youth Showcase, held at the National Building Museum on Tuesday, December 9th from 6:00 – 8:30 pm.

The event highlighted the achievement of these student entrepreneurs who have created businesses focusing on a wide range of products and services, from dog clothing items to local artists’ CDs, painting services, lunch boxes, and more. With the holiday season rapidly approaching, the event also provided a venue for these entrepreneurs to sell their wares in time for gift-giving.

“Most children start out selling something — lemonade, cookies or candy for themselves or for non-profit groups. These student entrepreneurs have taken their childhood fascination in business ownership miles further than that,” said Amy Rosen, President & CEO of NFTE. “They have shown determination as only an entrepreneur can by voluntarily completing the NFTE training program. Some have also completed our summer BizCamp program, which teaches them how to write and present a business plan,” Rosen added.

Read the full story in The Earth Times.

An economic development agency is holding an entrepreneur camp next week for budding young business people.

Children will have an opportunity to get a loan, create a product, do market research and sell their goods for a profit.

Enterprise Charlotte is holding the camp for youngsters aged nine to 12 at the Community Building Development Corporation.

Stacey MacLean, youth economic development officer with Enterprise Charlotte, said because the children are not old enough to work it is the perfect age to get them interested in creating a business and making their own money.

“In this county there are a lot of aging entrepreneurs, so there is a great opportunity coming up for them in the next 10 years,” said MacLean.

“The point is to teach the youth of Charlotte County about entrepreneurship to introduce them to the possibility of owning their own business as an alternative to working for other people. “¦ Some kids don’t even know what entrepreneurship is.”

MacLean said 10 of the 15 spots have already been filled. She said many of the children are returnees while others are the children of teachers and entrepreneurs, and the friends of youngsters that attended last year.

“They are thinking, ‘Wow, I can make money on my own,’ ” said MacLean. “Their money comes from their folks, so to learn how to make their own money is an interesting topic for them.”

During the first day of the camp, the young entrepreneurs will get a tour of a local radio station and record a commercial. On the second day, they will look through books with potential products and try their hand at making products such as stress balls and candles.

On the third day of the camp, the youth will finalize their product plans and hit the streets to do market research by asking people questions such as how much they would pay for the product and what colour they would want it in. At the end of the day, the children will visit the Community Building Development Corporation to get a $20 loan. On the fourth day, they will have their materials and will make their products.

The products at last year’s camp included purses out of sheets of foam and pipe cleaners.

On Friday, Aug. 15, the children will be at the St. Stephen Market from 11:30 a.m. to 1 p.m. selling their items – and hoping to pay back their loan and turn a profit.

Source: Telegraph-Journal