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A handwritten note on a piece of paper.

A Hard-Fought Negotiation: Allowance

Allowance. For many of us, it’s our first chance at earning an income. A shot of spending power. The ability to budget, to save, to give. And for two young Biz Kids, it introduced their first moment at the negotiating table, as well.

The contract below was presented by two savvy siblings to their parents–a job application of sorts. 11-year-old Devon and 13-year-old Sabrina proposed that their parents begin offering them an allowance. In exchange, they would agree to do some chores around the house.

Allowance-1The final result? It worked. And the entire family is benefitting, with their parents getting an extra hand with chores and the kids earning some cold hard cash. And just in case someone fails to hold up their end of the bargain, don’t worry–it’s all in writing.

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Do you earn an allowance? If so, it’s a great opportunity to learn how to save, earn, and even invest in a business of your own? Our episode, Where’s My Allowance, is your guide to your first income.

And our upcoming book, How to Turn $100 into $1,000,000, has an entire chapter devoted to the topic as well. Look for it in bookstores this April.

How to turn $100 into $1,000.

Striking it Rich (With No Regrets)

23678980223_9db8cf0849_zThe last few weeks of news cycles have been saturated with a piece of news that would affect just three people in the entire world: a billion-dollar lottery jackpot.

Jackpots like these bring out similar questions in us all: What would I do if I became a billionaire overnight? How much would my life change? Get easier? Get harder? Most people assume such a lucky strike would bring them happiness without end. It’s that assumption that led millions of people, after all, to spend money on little pieces of paper that are almost certain to have a final value of $0.

The truth is that the vast majority of lottery winners end up regretting their good fortune, telling interviewers that they wish they’d never won. Many report severe depression, broken relationships, and upended lives.

Why? How could such riches possibly disappoint? For many, the riches cause their winners to cast off all restraint. In other words, they don’t have a plan, Stan.

One lottery winner who managed to keep his life from spiraling out of control sat down with NPR to offer his advice to the latest entrants to the millionaires club. $220 million dollar-winner Brad Duke said, “The biggest piece of advice I can give someone is that you really have to define what’s most important to you.”

Simply put, Duke had a plan. He kept his day job, and told as few people as possible about the riches. He used the money to fund new ventures. Seed money intended to grow the wealth, not use it up.

This topic may seem far-fetched, but the truth is that as a Biz Kid, you may someday find yourself walking out of a meeting in which you just sold your patent, licensed your business model, or landed a lucrative account. How you handle that windfall will have a big impact on your life.

That’s why we filmed an entire episode called What to do with a Windfall.

Screen Shot 2016-01-19 at 8.08.58 AMAnd we didn’t stop there. This Spring, Biz Kid$ is releasing a long-awaited book titled How to Turn $100 into $1,000,000. The book covers earning, saving, and investing, and encourages a habit that is a lifeline for anyone lucky enough to strike it rich: making a plan.

 

A group of girl scouts posing in the back of a truck.

Times, they are a Changin’

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Well, it’s happened. That little knock on the door, followed by an irresistible offer of delicious cookies from an ambitious girl scout, has gone digital.

For many Biz Kids, selling girl scout cookies is a first step in a lifetime of entrepreneurialism. It’s a training ground for direct sales: pitching, listening, and closing. And now, it’s a training ground for the way business is often done today: digitally.

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Dell and Visa are behind the modernization, providing the technology and hands-on training to match those thin mints with thin tablets and credit card processing.

The change begs the question: what other pieces of industry are due for an update? What do you think will be the next familiar experience to get a 21st century upgrade?

Are you about to do some direct sales of your own? It helps if you know how to be a pro! We have a free guide just for you: How 2 B a Pro!

A graph showing the number of players in a poker game.

Baby Steps & Setbacks

What do you think Warren Buffett was doing at your age? Applying to Ivy League universities and being welcomed with open arms? How about Steve Jobs? Probably designing an incredible gadget all of his friends would want, right? Or Vera Wang–surely she was sketching breathtaking dress designs late at night, no?

The answer to all of those questions is a reassuring, “nope.” Buffett was denied to Harvard, Jobs dropped out of Reed College, and Vera Wang had tried out for the US Olympics team but was rejected.

It’s so easy to see successful people through the lens of their greatest hits, but the reality is that everyone faces setback. A website we recently discovered, called Fleximize, chronicles the steps–and missteps–of some of the world’s most powerful people.Screen Shot 2015-12-23 at 8.19.25 PM

Take a look at what your favorite business people were doing at your age, and then give yourself a break. Sometimes it’s the closed doors that lead to the most important breakthroughs of one’s life.

Catching up with Biz Kid$ Host Kaelon

The last time we heard from Biz Kid$ host Kaelon, he had made the scrappy decision to forgo an expensive LA apartment in favor of a more cost-efficient one: an RV. Today, we’re catching up with him to hear how his savings goals are measuring up!

A crowd of people in a shopping mall with christmas decorations.

Black Friday & the Myth of Savings

8210389235_33f181329a_zBlack Friday is upon us. Slashed prices are everywhere, as are long lines of deal-hunting shoppers with ads in hand. I’ve been one of them many times, taking home cheap movies and gadgets with the rest of America.

But ask any one of these shoppers why they’re out at 4am the day after Thanksgiving, and they’re likely to say something like this: “I’m saving so much money!” The compelling commercials and newspaper ads sure do give the appearance that savings are up for grabs. But are they? Let’s do some math. Let’s say that a TV normally priced $500 is on sale for $250. How much did you save? $250? Wrong. You saved $0. And you actually spent $250. Money spent is money spent.

But let’s say you really are looking for a TV, and you’re going to spend the money one way or another. Fair. You may end up saving money. But be careful. Some of those “sale prices” aren’t that at all. I recently saw this pricing on a retail website that says it all.

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Did you catch the fine print? The retailer even admits it: that sale price doesn’t mean anything.

Sometimes it’s easy to see a compelling sale and think you’ll get the better end of it, but there’s something we all have to remember: you are the target! Those ads are designed to make you take out your wallet. We even have an entire episode dedicated to this subject, which you can watch online here.

 

Mira mod, a young woman, sits in a chair in front of a desk.

Turning Problems into Profit

Listen to this business model: an 11-year-old girl heard the repetitive news about passwords being stolen and compromised, and started a business creating passwords for people.

Screen Shot 2015-11-11 at 2.02.36 PMWhile others were worrying and complaining, Mira not only found a solution to their headaches, but found a way to profit from that solution as well.

This is no new phenomena. Many of history’s most successful innovators have built their empires on a keen ear and a problem-solving mind. Ralph Waldo Emerson once said, “Build a better mousetrap, and the world will beat a path to your door.”

The question is, what are your problems? Here’s a challenge for you, Biz Kid: keep a pad of paper in with you everywhere you go this week. Anytime you experience something unpleasant or challenging, write it down. At the end of the week, look at your list of “problems” and brainstorm some solutions. Then choose one or two to follow through on.

You never know: you just may discover that “better mousetrap” that the world is waiting for.

A white shirt on a man's hand.

Profit: Who Cares?

5634567317_b4d5b61ff8_zIf you’re like many Biz Kids, the thrill of starting a business can provide enough adrenaline to keep going, regardless of profitability. But a business that doesn’t make money—or loses money—is rarely sustainable.

The ability for businesses to lose money and keep running, year after year, should be unfathomable. But it happens. Often. Some airlines have operated at a net loss for decades, and even the untouchable Amazon.com has reported a net loss in many a quarterly report, without losing the interest of investors.

airline-profit-marginBut where’s the line? As a young entrepreneur, it helps to make a goal for profitability and then stick to it. Want to launch a business, but worry about how long it will take to turn a profit? Give yourself a certain amount of time to make it happen. If it doesn’t, have an exit plan for how you’ll recover from your investment. Then move on. Sometimes, the only way to strike gold is to try and fail a few times.

But in the end, how do you know if you’re profitable, anyway? And how can you plan out your expenditures at the onset to improve your chances of success? We’ve created a worksheet with those very questions in mind. Download it, put your math skills to work, and get on your way to profitable success!

For more on starting a business, watch clips from our episode, “Crash Course on Starting a Business” online for free.

Indiegogo statistics all campaign owners should know.

Launching a Business Before You Can Drive

See if this challenge feels familiar: you have an invention that your family and friends are encouraging you to create, but there’s a problem: you need some cash to create it. And you’re a teenager. You don’t have any credit, and your resources are limited.

What can you do? Well, one option that you have is called “crowdfunding.”

What is crowdfunding? Crowdfunding is the process by which entrepreneurs can raise funds for their idea from their future customers. Customers agree to pay now for a product that they’ll receive in the future. The buyers get to be among the very first to have a cutting-edge product, and the sellers get to make the idea that’s been keeping them up at night.

Kickstarter was one of the first websites to promote this kind of funding. Its most famous campaign was for a watch called Pebble that linked to smartphones (before Apple made it mainstream). It raised more than $10 million from 68,000 people.

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Indiegogo, another crowdfunding platform, just released a study of more than 100,000 crowdfunded campaigns. Check out their “7 key stats” here.

Screen Shot 2015-10-27 at 11.17.55 AM Your access to crowdfunding is a product of good timing. Sites like Kickstarter and Indiegogo didn’t exist a generation ago. The opportunity to raise funds from your future customers is revolutionary, and it’s an opportunity that is yours for the taking.

Did we just eliminate one of your excuses for not starting that business? Sorry, not sorry.

A cow with a number on its back.

What’s in a Brand?

What comes to mind when you hear the word brand? A cow marked as belonging to a certain farm? A logo of your favorite gadget company? The way your coolest friend dresses and speaks? Actually, all of those responses would be correct.

Merriam-Webster defines “brand” as:

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Brands were first used by cattle owners to differentiate their livestock from that of their neighbors. The marks were useful if an animal was lost, but they also became a symbol of quality. A marking that came with an expectation.

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Today, we associate brands with trademark symbols. A legally protected name and logo referring to a company’s line of products. Many of us are loyal to certain brands of product.

Sometimes brands themselves become more important to us than the products themselves. That’s why we care what store name is emblazoned on the front of our shirts, and why we leave labels on our hats. We want to be associated with brands that we think set us apart. In a way, we’re building our own personal brands.

 

Even presidential candidates spend thousands of dollars creating brands for their campaigns. Yes, people have brands, too.

So what’s your brand? If you’re a Biz Kid, you probably have more than one: a brand for your products and services, and your own personal “brand.” The way you dress, interact, and speak.

There are plenty of resources to help you create a brand for your business. Here’s a few:

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Learn how to use Biz Kid$ in the classroom with new ‘Did You Know?’ videos

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Watch the new Did You Know? Videos that show all our financial resources available. Learn how to use the Biz Kid$ games, lessons and clips in the classroom!

A group of people in a hospital room.

Teens Bake Cakes to Renovate an African Hospital

The following is a guest post written by Alison Geist of Demoss.
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For Gabe (age 15) and Livvy (age 11) Feinn, baking and decorating cakes isn’t about providing dessert; it’s about protecting lives. The two Louisville natives decided to raise $35,000 to renovate a mission hospital in Africa through international relief organization Samaritan’s Purse. In less than a year, the kids had met their goal through donations earned by baking more than 200 cakes and 2,000 cupcakes. Next month, they will be traveling to the Democratic Republic of the Congo (DRC) to see the maternity ward that was renovated at a hospital in Nyankunde as a result of their efforts.
It all started in October 2013 when the kids noticed a Samaritan’s Purse gift catalog in the mail.  Flipping through it, they learned that for $14 they could buy two chickens to provide eggs and income for a family in poverty.  Gabe had taken a cake decorating class, so he and his sister decided that they would bake cupcakes for their family garage sale to raise the money for the chickens.  When they quickly made more than enough money for the chickens, Gabe told his mom, “We want to do something that takes a lot of faith.”  Looking at the catalog, he and Livvy decided they wanted to raise $35,000 to renovate a hospital and that they would use their cake-making skills to solicit donations toward their goal.
Gabe, known as “Gabe the Cake Man,” with Livvy, challenged others to embrace the idea that anyone can make a difference. The kids posted about their project goal online and started speaking at local churches, schools and groups, including the Muhammad Ali Center’s Humanitarian Awards banquet last October, where an anonymous attendee, inspired by their story, donated the remaining $12,000 they needed to meet their goal.
Over the last several months, Samaritan’s Purse has been working on the renovations to the maternity ward, which include: constructing a new roof; replacing the ceiling; putting in new concrete and tile floors; installing a solar power back-up system; and adding an operating room for c-setcions, two private rooms, and two additional sinks.  Now that the renovations funded by Gabe and Livvy’s donation are finished, they are headed to the DRC to see the completed project.
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