Wow! What a Work- shop!

Last month I held my first Kids Finance Coach Workshop at my home and it was a blast! We invited kids and their parents to my house for an afternoon of fun activities to learn about money. We talked about things like allowance and spending, and even why and how to start saving money. Of course we couldn’t talk about money without learning about charitable giving. Money really can be used to help improve the lives of others.

Parents, interested in having Coach Brett visit your community or starting a League of your own? Contact Denise Villanueva.

I know people save money, but how can companies save money so they don't go broke?
When your parents feel that the family is spending too much money, how do they cut back? Maybe they don’t go out to eat as often. Maybe they use more supermarket coupons. Perhaps they decide to cut the grass and do the yard work themselves instead of hiring a service.

Well, companies also have to find ways to reduce their costs, especially during difficult economic times like we’re experiencing now. When times are tough, companies often experience a decrease in sales revenue. When sales go down, and costs stay the same, the company is less profitable, so they have to find a way to maintain profitability by reducing costs. Let’s take look at how this works.

If a company has sales of $100 and costs of $60, then they make a profit of $40. If sales go down to $90 and costs stay the same, the profit is reduced to $30. But if they can reduce their costs to $50, then they still make a profit of $40.

Here are some of the things that companies can do to reduce costs:

1. Supplies and materials - sometimes companies can negotiate with their suppliers to pay less for the materials they use to make their products, or for the supplies they use in their offices.


2. Freight - manufacturing companies spend a lot of money shipping their products to market. Shipping specialists can often help companies find ways to reduce their freight costs.


3. Electricity - Power is usually a large percentage of the costs of a manufacturing operation, especially when they are charged based on their highest level of demand in a given month. By installing monitoring equipment, they can ensure that lights and other equipment are shut off when they approach peak demand, which helps reduce the hourly rate that the company pays for power. (It’s not too different from your parents reminding you to turn off the light when you leave a room.)


4. Staffing - One of the main things that companies do to reduce costs is to decrease the size of their workforce by letting some employees go. This is known as “layoffs”. Most companies try to do everything possible to cut costs in other ways before laying off employees.

What have you done lately to help out in your community? You may have heard on the news or from your parents that our economy is not doing too well lately. That means more people than ever are struggling to pay bills and even provide food for their family.

No matter how old you are, there are many creative and inexpensive ways to help others this summer.

Take a Stand With Sunkist
Kids ages 7 to 12 can register at http://www.sunkist.com/ and submit their "Take a Stand" pledge and receive a free Sunkist lemonade stand, while supplies last. Then sell glasses of homemade to raise money for a charity.

Angels in Action
Students ages 8 to 18, will be recognized and rewarded for exemplary acts of service to benefit their community, a charity or cause. Visit http://www.angelsoft.com/ to get great ideas for creative projects by reading about last year's winners on the Angel Soft site.

Stamp out Hunger
It is easy to help local hunger organizations at a very low cost by donating coupon bargains.
Students can use the Grocery Deals by State page on The Savings Mom Web site, www.savingsmom.com, which lists grocery coupon deals in most states.

Clip coupons and buy several items to donate yourself. Or make a flyer asking neighbors to stick a few canned items in a sack and leave the sacks on their front porch on a designated day. Then go around collecting the bags to be delivered to a local food pantry.

Start a Great American Bake Sale
Sponsored by Domino Sugar and C&H Sugar, kids can sign up to receive a Participant Kit which includes everything you’ll need to get baking and starting selling your treats. Donate the money you earn to an area homeless shelter.

Need Cash? Get to Work!
It's not always easy for kids to find a job. But here are some things kids can do to earn a little extra cash over the summer.

• Babysitting of course. Check your local hospitals to see if they offer a babysitting class, or learn more about babysitting and earn a babysitting certificate here.


• Get your lemonade! Not only is a lemonade stand fun, but you can shake things up and offer home-made cookies too. Don't forget to pay Mom and Dad back if they help with supplies.
  Walk dogs/care for pets. Lots of people are too busy over summer to take care of their pets. Start your own pet care, dog walking business. Those long-haired dogs might need brushing, too.


• Yard work and gardening is another good idea. Offer to cut grass, weed gardens and do general yard work for people. Seniors especially can use the help in the summer.


• Hold a car wash! Get a group of friends together and with parents’ permission start your own car wash.


• Have a yard sale. Clean out your closets, toy chests and basements of all the toys/books you no longer use. You'd be surprised how much stuff you no longer use.


• Teens can visit here to learn how to find a job, where to get working papers, where teens can work, what to wear for an interview, and how to obtain references.

There are laws about kids working so you have to be creative when you are young to earn money. Get your parents involved too, they may have some good ideas. They may even be more encouraged to help you out if they see you trying to make your own cash instead of just holding out your hand.

Learning the “Real” Value of Money through Giving

I have always believed that a necessary part of learning about money is learning how to value what you have and sharing with people who do not have as much as you. In an effort to teach these lessons to my own children, my wife and I helped our sons Keanu and Tristen establish their own non-profit organization call Turn Kindness On (TKO) Helping Hands. TKO Helping Hands motivates children of all ages to change their world through volunteering, harnessing their uniquely empathetic energy and empowering them to build a lifelong relationship with community service.

During a recent family vacation to Africa, our family did what we always do when we travel. We took money and supplies collected through the efforts of TKO and local students and delivered them to children’s organizations in the communities where we visited.

Click here to watch and see what a difference you can make when you understand the “real” value of money.

What is Diversification?

Have you ever heard some say “don’t put all of your eggs in one basket”? What does that mean? Well, if you put all of your eggs in one basket and that basket drops, you run the risk that all of your eggs will be broken and lost. But if you put a few eggs in two or more baskets and only one basket falls breaking only its eggs, you still have some good eggs in your other baskets that didn’t fall and break.

That is diversification: putting your money in several different places or buying some stocks from several different companies. For example, if you use all of your money to buy stock in only one company and the value of that stock drops then you could lose all of your money. But if you diversify, maybe you buy stock in several different companies and put some money in the bank for saving and keep some money at home in your piggy bank. Then if the value of stock in one company goes down, you only lose the money you invested in that stock but should still have money in your other locations.

By the way: what’s the most you can ever lose in stocks? The amount you invested. What’s the most you can gain? Unlimited – anything can happen.

How Much Do Stocks Cost?

When you think about buying stock, you should remember that there is risk that goes along with it, but there is also opportunity. So if someone asks the question “what are the best companies to invest in,” the answer must take into consideration the amount of risk that investor is willing to take. If the investor says, I don’t want to lose this money to make a fortune, but I really think it’s a great company - there are lots of companies that look promising. Many of them you’ve never heard of, but they believe they’ve got the next newest idea.

Have you ever heard the expression “Time heals all wounds”? When you get older, you’ll have typical grown-up experiences – like with boyfriends and girlfriends. You’ll break up and think the world is coming to an end. But over time, you’ll get over it and your life will get back to normal and things will be OK. Well it’s similar with stocks. If you invest in enough stocks and diversify – buying some companies that are less risky and some with medium risk and some that are real risky – over time it should all be ok. However it's important to remember that diversification doesn't guarantee you will make money and it is still possible to lose money in your investments.