BY KEVIN MANAHAN
When you think of what’s on the minds of most high school students these days, managing finances is probably not as high up on the list as the new car they’re dreaming of or the dress they’re buying for prom. But maybe it ought to be, since only 59% of young adults pay their bills on time, while most parents aren’t teaching their kids about saving and investing for retirement.
Which is what brought me to a business class at Gladstone High School yesterday. I was invited there by Bryan Sims, the 26-year-old CEO of brass|MEDIA Inc., a Corvallis-based media company focused on promoting financial literacy and formed by Sims when he was just 19. Yesterday was the kick-off for brass’ “Money Side of Life Tour,” launched in time for financial literacy month with Gladstone as its first stop. The tour is part of the brass|STUDENT PROGRAM – Oregon, an initiative to get free personal-finance resources (like the company’s flagship magazine) to teachers and students around the state.
The five-school tour has First Tech Credit Union as a presenting sponsor, and financial education officer Ryan McKernan was among the speakers at the Gladstone presentation. McKernan said it’s a good time to be promoting the topic among high school students, with district budgets cutting out financial-education classes as required credits. “And being a member-owned co-op, like all credit unions are, our strength is in our members,” McKernan said. “So as strong as they are, our balance sheet will reflect that as well.”
Yesterday’s presentation was aimed at the basics of savings options, with advice from Sims, McKernan and brass’ director of education, Laura Edmonston. And while many in the class of juniors said they worked part-time jobs ranging from Papa Murphys to moving services, they seemed to be relatively new to the idea of making budgets – something that could come in handy when the expenses start to add up for the upcoming prom they talked so excitedly about. The three speakers spent the class period discussing everything from basic savings and money market accounts to 401k and mutual funds, all in the hopes that students would learn the value of saving while also building credit.
But there are plenty of traps young people can fall into. McKernan said new college students get inundated with credit card offers and can quickly fall into debt, although he said legislation is now helping keep the flood of offers under control. “Some of that is going to go away,” McKernan said. “But we would see kids leaving college with a huge amount of credit card debt that is just unbelievably hard to get out of.” In addition, he adds, many young people need to be more educated about the impact of credit in general. “I don’t think a lot of kids realize that their credit history can affect a whole lot more than just their loan rates,” he said.
Echoing that sentiment, Sims compared the pro and cons of credit cards to driving a car; when used correctly, it’s a great tool, but it can also be extremely dangerous when it’s not. On top of that, relying on payday loans can get young people into trouble (emphasizing the need for them to get insured, interest-earning savings accounts). So can relying too much on parental guidance when it comes to finances. “You always think that your parents know how to do it right, but you also have to educate yourself,” Sims said. “Just because they’re doing something doesn’t mean it’s going to be right.”
Sims knows from experience how far proactive financial management and money growth can take you. As a student at Crescent Valley High School in Corvallis, he started a teen investment club (which eventually became the largest in the country) and began putting paychecks from his job as a janitor into the stock market. Now he’s running a 25-employee operation that’s been recognized as one of the fastest-growing companies in the state. An added bonus: brass does its part to help Oregon’s economy by circulating its healthy out-of-state revenues into Oregon, getting funding from local angel investors and seeking local companies to partner with. And if Sims’ efforts to educate tomorrow’s businesspeople pay off, Oregon could have a shiny future full of companies like brass to look forward to.
Kevin Manahan is the online editor for Oregon Business.