The next generation of family business owners is required to be many things. They are expected to be smart even smarter than their talented entrepreneurial parents.
They also are expected to be financially fluent. Many will learn financial skills by accident and/or on their own, and this self-taught process tends to happen later in life. A family business parent can start now to ensure the next generation has all of the financial skills needed in order to be a good steward of the family business.
If you are a parent like me, you are probably thinking about how to raise good kids in todays global, consumer-driven society. Add the dynamics of a family business or family foundation, and parents of next-generation owners may be doubly interested in teaching their kids to be financially savvy. I heard one mother worry about how she was going to train her 19-year-old son to eventually run a growing multi-national family business.
The goal is to start being a purposeful parent when it comes to raising financially responsible kids, no matter their current age. There are many books on the topic of raising financially literate children. One of my favorites is Raising Financially Fit Kids by Joline Godfrey, who walks the reader through age-appropriate activities in an organized manner.
Many of these books offer basically the same advice. Here are ideas for children ages 5-18:
Communicate your familys money values. What are your familys values around saving, giving, spending, borrowing and (I am adding this one) working? In many families, you save as much as you can, give around 10 percent of what you earn, spend no more than you make, and borrow only if you have to AND can pay it back.
I add working because families have different ideas about work. For instance, when a parent says to their children, Do what you love implying even if you dont make any money their children may wonder if their parents will be financially supporting their passion. Another family work value may be Work hard and bring home the bacon!
Having these conversations about values can help your child make better decisions when faced each day with the many, often conflicting, money messages.
Understand your childs money personality. Godfrey writes about the dominant money styles kids have; every child is different, and what works for one child may not work with another. Understanding your childs money personality can help you custom design their financial training.
Is your child a Hoarder (doesnt spend, has secret cash stashes), Spendthrift (cant wait to spend), Scrimper (spends, but watches every penny), Giver (lends friends money, pays for meals), Beggar (always has a hand out), Hustler (Deal in every transaction), or Oblivious (Whatever approach to money). No dominant style is inherently bad, although each can have an extreme to watch out for.
Show your children its not magic. Credit cards and ATM cards may look like magical money tools, but we all know the danger of keeping kids in the dark. I saw a woman place her 2-year-old on the check-out counter of a well-known kids retail chain. As she and the cashier were chatting, her little cutie took her moms credit card and correctly swiped the card in the machine. Clearly, she had been watching her mom and at 2 was ready to become a pro!
What is a parent to do? First, start the credit conversation early: Talk to them about credit cards and how they work, credit scores, interest rates, etc.
An ATM card is also magic! You put the card in, punch a few buttons and out comes money! Help your kids understand how and why you have access to this money. One college student called her parents banker to ask why she wasnt able to get any more money from the ATM. She had no idea there was a limit to the cash! There are many stories of kids going off to college with their emergency-only card and racking up thousands in debt.
Mind the marketing messages. There is a reason age-appropriate toys are placed at the childs eye-level. Marketing companies of retail chains know kids have power over hassled, tired parents. Instead of arguing, parents often put the toy/candy bar/article of clothing in the cart and keep going.
There is no time like the present to talk to your kids about the many marketing messages they are facing each day. Between the commercials aimed at selling kids the latest gadget to the toys placed at eye-level, help your child become wise beyond their years and understand when they are being marketing to. Make it a game: Whoever can spot the most marketing messages wins!
Support your young entrepreneur. Get your young one to start thinking entrepreneurially. I recently went to a conference session on raising kids amidst success, and one attendee spoke about an activity he did with his 5-year-old daughter: Every new business idea she presented to him that would solve a viable problem, he gave her a quarter. The daughter started thinking of so many new ideas, she soon had a heavy book of quarters.
Locally, consider signing your teen up for GVSUs week-long Teen Entrepreneurship Summer Academy, or TESA. The program teaches high school students fundamental business concepts and essential entrepreneurship skills through hands-on, highly interactive, and creative workshops, according to their marketing.
Are your kids in college? Its not too late! Do what one CEO did. He asked his son to bring home his undergrad accounting textbooks and then had the family business CFO go through the books with his son to explain the connection between the college coursework and running the family business. Connecting the dots in this way will make an accounting course that much more meaningful.
Its never too late to start not only your kids financial education, but also your own. Why not partner with your kids and learn together?
Mary Hunt, founder of Debt-Proof Living and author of Raising Financially Confident Kids, wrote about how she went from being severely in debt to financially savvy with the help of her husband and two boys. Her boys learned about money management alongside their parents. Today, the whole family is debt free.
Ellie Frey is the director of the Family Business Alliance, a West Michigan nonprofit tasked to help family businesses succeed generation to generation (fbagr.org). She is also the 3rd generation of her familys foundation. For more information about Ellies journey raising fiscally responsible children, follow her blog at FamilyBusinessMoneyMama.com.
Joel Tauber, SHARE (photo direction: Joel Tauber, shot by Kristi Chan) from the art installation and movie, The Sharing Project
There are so many different kinds of sharing that it makes me wonder why our language lumps them all together.
We share time, energy, space, information, stories, and feelings. We also share food, money, tools, cars, and toys. We share with immediate family, extended family, friends, neighbors, colleagues, and strangers.
Sometimes we share our personal possessions via loans, gifts, or charity. Other times, we decide that certain things belong to all of us (or at least some of us), and we share them in communistic ways.
Alison and I tell our son Zeke that everything in the family room belongs to our family collectively. Zeke can keep his special tools in his bedroom and moving box boat; but he cant hide any books, blocks, or train tracks in his secret compartments, because they belong to everyone.
Before his brother Ozzie started crawling, Zeke had full control of almost all the toys. He shared them on his terms. He loaned them to Ozzie with the understanding that he would get them back; and, if he was feeling particularly generous, he offered certain toys to Ozzie as gifts.
When Ozzie started asserting his right to use the communal toys, Zeke realized that he didnt own as much as he had previously thought. He had been taxed significantly, and he wondered why he should share his remaining prized possessions.
If I wanted to scare Zeke, I could have told him about Thomas Hobbes. He paints a picture of brutish, short, and miserable lives for those who dont act altruistically. If Zeke is perceived as selfish, then Ozzie and others are less likely to embrace him; and he might be left to fend for himself in a competitive, harsh world.
I dont want to motivate Zeke through fear, so I tell him that sharing his special tools will make him happy. In fact, sharing will make him happier than almost anything else. After all, thats what John Stuart Mill suggests when he describes the particularly wonderful kind of pleasure that we experience when we act ethically.
Sometimes that line of thinking resonates with Zeke, and sometimes it doesnt. Zeke recognizes that its sometimes quite hard to share, and sometimes it even makes him sad.
So, I turn to Plato and his claim that if we exercise our reason and act justly, we become more perfect human beings. I tell Zeke that he becomes a better boy when he shares. He becomes Super Zeke when he acts generously.
Zeke loves that idea, especially because he has a super hero costume with the letter Z on it.
There may be certain problems with Platos approach, just as there may be limitations to every other philosophical argument for altruism. Yet, ultimately, I dont think it matters. There are plenty of reasons to embrace the value of sharing, even if its difficult to lump all of those reasons together into one philosophical framework.
Christian Miller believes that we probably havent embraced the value of sharing -- or charity -- enough. He points out that many of the philosophical models that so many of us believe in ask more of us than we seem to realize. The Bible commands us to love thy neighbor as yourself, Kant tells us to treat everyone as ends, and Utilitarianism mandates that we maximize happiness in the world. None of those ethical systems imply that we have the right to share or give charity only when we feel like it.
In fact, at least according to Peter Singers vision of Utilitarianism, we may be required to give our money and food to those who are starving up until the point that we are in danger of starving ourselves.
I feel chastened when I think about Peter Singer and my conversation with Christian Miller. I believe in the value of sharing, and I aspire to be a generous person. Yet, the ideal that Singer describes seems much too difficult to achieve.
Should I feel guilty about enjoying certain material comforts? Should I feel bad that I hope that Alison, Zeke, and Ozzie will live easy and even luxurious lives?
I was taught in my religious Jewish high school that we are acting selfishly if we dont offer ten percent of our income to charity, but we are acting too selflessly if we give away more than twenty percent.
These guidelines sometimes feel completely arbitrary, but Ive tried to follow them, nonetheless. They remind me to share at least some of my possessions, and they alleviate some of the guilt that I feel when I notice how many people are suffering.
Yet, I wonder if Im blindly following convention. I contemplate sharing our 2800 square foot house with as many homeless people as possible. I consider giving away almost all of our possessions and living in a tent. The thoughts appeal to me momentarily, but then they pass. I continue living my comfortable life, and I pray that I share enough to be a good role model for Zeke.
Joel Tauber is an artist and filmmaker who teaches experimental film and orchestrates the video art program at Wake Forest University. His current undertaking - The Sharing Project - will be presented as both a sculptural video installation and a feature film. http://thesharingproject.net
San Francisco, CA (PRWEB) December 04, 2014
Alight, a fast-growing and innovative provider of industry-specific software applications, and Bestborn Business Solutions, maker of Loan Vision, a mortgage banking-specific accounting and financial management solution, today announced the formation of a partnership to bring a solution that offers mortgage lending firms maximum financial awareness and control over their businesses, both now and into the future.
"I'm excited to partner with the Loan Vision team and bring mortgage lending firms a more comprehensive way to manage their financial performance, both now and as they look toward the future," said Michele McGovern, CEO, Alight. "Loan Vision gives firms a crystal-clear picture of their current financial performance and Alight gives customers the ability to quickly and easily plan for shifts in the market and turn potential challenges into opportunities - that's a powerful combination."
"Loan Vision gives customers a best-in-class solution for general ledger accounting, as well as financial management, that truly affords them maximum understanding of where their businesses stand at any given moment," said Martin Kerr, president, Bestborn Business Solutions. "By partnering with Alight, we can offer customers a solution that will help them achieve and maintain financial leadership, both now and into the future, no matter what changes the market might present."
Firms interested in learning more can contact Mark Burner, Alight, mburner(at)alightinc(dot)com.
Alight is a fast-growing provider of industry-specific applications that help firms transform how they view planning and budgeting and make it a constant and relevant part of their businesses. Alight has over 300 customers, across some of the most dynamic and complex industries, including financial services, mining, telecommunications, health care, and food and beverage. Alight is committed to helping customers achieve and sustain top financial performance. For more information visit alightinc.com
About Bestborn Business Solutions
Founded in 2006, Pittsburgh-based Bestborn Business Solutions, LLC, offers custom software development using Microsoft Dynamics NAV. The firm's flagship software product for the mortgage industry is the Loan Vision Mortgage Accounting Solution, the fastest growing accounting software for mortgage banking. Loan Vision is designed to reduce manual workloads, reduce risk, help overcome industry challenges and help organizations grow. For more information visit loan-vision.com.
From regifting to trading your unwanted presents with a family member for something better, the holidays give bartering a short-lived existence on most Americans radars. In much of the world, bartering is a thriving way to exchange the items one has for what he now needs, but Americas corporate retail structure leads most to rightly believe an attempt to barter with a merchant would be met with disgust. A large marketplace for bartering has emerged with the Internet, helping those who dare trade for anything from small trinkets to cars.
What Should You Barter for?
- Clothing. The thrift shop provides a venue for clothes to be exchanged but with an added markup and money transferred. Whether its with a roommate, friend or through a site like SwapStyle, bartering can expand your closet tenfold. That item thats been relegated to the back of your closet could be exactly what another person is looking for.
- Furniture. From furnishing your apartment to your companys workspace, bartering can be an affective way to minimize waste and maximize product utility. This was Joseph ONeills experience at The Expert Institute. Working in a growing startup made me realize the potential of bartering, and improved my skills for doing it, OheNeill said. Ive found bartering for (and with) furniture is usually the most useful, especially in New York City. We were able to barter several of our old Ikea desks for a few Polycom telephones when we moved into a larger office, which helped us avoid paying someone to take the desks and get something very valuable in return. The key to successful bartering is to find what you want first and then offer a trade. Youre far more likely to get a good deal if you initiate the transaction rather than posting that you want a trade and waiting for offers to come in.
- Gifts and crafts. Especially during the holidays, a barter system can help you decorate and celebrate cheaply. Gifts can of course be bartered, but if youre crafty, what can you get for your handmade Christmas cards? If youre not, what can you offer to get such one-of-kind cards? A smart tactic with neighbors or extended family is to for one person to buy plenty of ornaments and the other to buy a large number of Christmas cards. Swap half your stash to minimize purchases and cut down on costs by buying in bulk.
- Services. I learned to trade stuff for stuff, stuff for services and services for services, said Pablo Solomon, an artist and designer. With private practices, most anything can be traded so long as the owner agrees to it. If you barter for medical services or professional services, make sure you are completely satisfied with the provider and that you are treated as any other cash patient or client, said Gary Oshry, president of New England Trade.
- Technology. With the holidays bring a surge of technology purchases, as these items are often discounted on Black Friday. With every crop of new iPhone, Android and laptop iterations is a sea of buyers eager to buy the second most-recent model. Using a barter system can help you upgrade your phone at no cost.
Those bartering must understand the difference between profit and loss. Although value can be intrinsic, those who barter must have an understanding of the value of the items traded to barter effectively and without remorse. Furthermore, its important to understand that some items (collectibles, art, etc.) are more valuable to some people than money, meaning the value one puts on an item might not be the same for another person, nor meet the markets belief of its value. Lastly, in the long run barterers must understand why they are bartering. Is it to save money, to make money or
to get something of value? Solomon provided these insider tips:
- Nothing is taboo when it comes to trading. The secret is in finding out what the other person values. If you can obtain or offer that item for less than expected and bring it to a trade, then you have a good chance of walking away with what you want.
- Some items are one of a kind or close to it. These items have value beyond dollars and cents, at least for the person seeking the item. Its also important to understand that some things will gain value over time as they become novel, rare or collectible, thus taking a short-term loss is sometimes worth it.
- Being able to read people is key. Some people are ready to dump stuff just to get it off their hands. Others need money, tools or services in a pinch. You can make better deals with people who really need to trade, rather than with people who are trading just for profit. In short, immediacy is helpful.
- Remember to keep both parties comfortable. According to Shai Barel, an avid barterer and partner at ClutchMaven.com, a contract can keep both parties comfortable and confident. There needs to be a good contract that breaks down the terms, and both parties should have a good sense of trust in each other, Barel said. Also, it is best to try to avoid bartering situations where one persons product or service is delivered earlier than the others. This could create unpleasant feelings between the two parties, as well as a lack of motivation to deliver services. In addition, one should avoid bartering for services that dont have set objectives or goals that cant be quantified.
There are both theoretical and practical problems in bartering. Practical problems include some of the issues listed above; theoretical issues include non-standardized values, indivisibility and coincidence of want. Non-standardized values can lead to the feeling of being gypped, while indivisibility and coincidence of want are problems when trading one item or service for multiple occurrences of another, according to Kevin Hoult, certified business adviser at the West Virginia University Small Business Development Center. Take for example, trading webpage development for 10 haircuts. How do you quantify tip in your transaction -- and what is the timeline for paying back the service?
From a legal stance, barter deals can go up to the Internal Revenue Service level if things go sour, according to Hoult. The other monsters hiding under the bed of [bartering] are cash flow and tax consequences, Hoult said. It is very risky to trade inventory for anything. The cost of replacing inventory and the loss of gross profit from the transaction can result in business owners shoplifting from themselves.
Tax consequences rear their ugly heads when one of the parties reports what was given up in barter as a business expense. Tax authorities will wonder where the other half of that transaction might be, perhaps resulting in a dreaded letter from the government.
Time Banks Offer a Compromise
Luckily, those who barter for their businesses can get around both the discomfort and tax implications by brokering their deals through a bartering exchange, also known as a time bank. For those looking to barter out of the confides of Craigslist and sites like U-Exchange, time banks provide another source to barter that are especially helpful when a trade necessitates multiple parties.
Doing one-to-one barters for business owners is extremely difficult and often one side does not receive full value for what they barter or the service they provide, said Bruce Condit, director of public relations at Allegiance Capital Corp. Condit recommends companies avoid tax issues when bartering by using an organized barter exchange. The main objective of barter is to sell excess time, products or services on barter -- at the same rate you would normally sell them, Condit said. Then you use the barter dollars to purchase goods and services you would normally pay cash for.
However you choose to barter, whether it be through one of the many swapping sites out there or between just family and friends this holiday season, any reservations you have toward bartering could be inflating your expenses and preventing you from capitalizing on the value others might see in your items that might be going dusty or unused.