Chapter Eight: Getting Money
You’ve been reading about money for a while now. What if you don’t have any, or don’t have any means for making it? Rest assured that as you get older, you will have more opportunities to make money, but if you have never really earned an income before, it can all seem a little confusing. It really isn’t a difficult concept: Find the best job you can while earning the most money possible. The goal is to earn an income while also doing something you enjoy or that stimulates you. Think about how frustrating it would be to earn a lot of money but have a job you hate going to each day, or to have a job you love but not have enough money to buy the things you need. It’s important to find a balance. You may already have an income. Maybe you are already employed, or your parents give you a steady income in the form of an allowance. Whatever your situation, there is usually room for improvement. Perhaps you need to make more money, or you aren’t very happy with your place of employment. Read on for tips on how to get the job you want, making the money you need.
Case Study: Your First Job
Stephanee — Former Student
My first job was at a grocery store. I started working right after the beginning of my junior year in high school. I started out working about 30 hours a week and had some fluctuations, but by end of junior year, I was working at least 36 hours a week, some weeks up to 48. Until I started driving myself (as in, my mom got tired of doing it and would let me), my mom would pick me up right after school at 2:45; I would change in the van; and she would drop me off at work to start at 3. If I was working eight hours, I would get off at midnight. I almost always worked until 9 p.m. If I started at 4 p.m., I would get off at 10 p.m.
So, a typical weekday for me, as a junior in high school, went like this:
7 a.m.: Start school day. I was taking an early-morning class to get my athletics credits.
7:45 a.m.: Work on homework. I also did homework throughout the school day.
2:45 p.m.: Get out of school.
3 p.m.: Start work at the grocery store.
7 p.m.: Eat dinner at work (frozen dinner, sandwich, etc.).
12 a.m.: Get off work, picked up by my mom.
12-1 a.m.: Do homework, and then go to bed.
I usually had one day off during the week, and sometimes I had two days off. I liked working at least two of the 3 p.m. to 12 a.m. shifts because that meant I got more school days off with still a lot of income.
Why did I work? I wasn’t able to play any sports or participate in any school extracurricular activities, so I couldn’t partake in athletic games, and I couldn’t try out for the tennis team. I couldn’t be in band because of the money issue. However, when I saw the job posting for Albertson’s, I took a chance and asked my mom. She said yes, took me to the interview, and I was hired. I had money and could buy clothes, food, or anything else I wanted. I also had awesome health insurance that included orthodontics — which I wanted really badly; I was eligible for orthodontics after two years of employment.
Did my parents care about my long work hours? I think they figured it kept me out of trouble, and they didn’t have to buy anything for me anymore. I hardly ever ate at home, either; I bought all my meals.
Because I was at work so much, I missed out on other things at school. I never took the PSAT or other college entrance tests. What good came of working? I gained independence, self-confidence, and the value of a dollar.
I learned how to save, how to overspend, and how to run out of cash quick. My parents had me start paying $100 per month in rent starting the month I turned 18, and by time I was 20, I had bought my own car, taken two trips, paid for a year of college with my own money, and paid for my own auto and health insurance. When I moved out, I was able to balance my budget, and within five years, bought my first house for $135,000, and was able to put $20,000 down.
I will not encourage my own children to work like I did. Summer jobs and working on a Saturday morning are all right, but to me, it is not all right to work during the school year. I want them to get straight-As, volunteer, join clubs, play sports — whatever they want — but be well-rounded and eligible for scholarships. I want them to enjoy their teenage years.
Getting an Allowance
Depending on what state you live in, you may have to wait until you are 15 or 16 before you can go out and get a regular job with an employer. If you are not yet at the age to get a job outside of the home, or if you just want to concentrate on your school work and not bother with a job right now, you still have options for earning an income. If you do not get an allowance, it may be time to approach your parents about giving you a regular weekly allowance that will allow you to budget your money, as well as practice saving and spending carefully. If you already get an allowance, but don’t feel like you get enough money to cover all your expenses, it may be time ask for more money. The amount of money you receive for your allowance depends on how much money your parents are willing (or able) to give. Don’t assume that it is time to get a bigger allowance just because you always run out of money before the next allowance comes. Use the tools you have already learned about budgeting and managing your money to make sure that you are actually spending and saving like you should.
Here are some tips for approaching your parents about giving you an allowance or increasing the amount of allowance they already give you:
• Ask to speak about this topic during a time when you both aren’t in front of the television or otherwise engaged in something. This is a discussion you should have between you and your parents without any distractions, if possible.
• Come to the discussion prepared. Be ready to defend your need for an allowance and to stay calm if your parents initially react badly. Your parents may say something along the lines of, “Why would you need an allowance? We already give you everything you need.” or “If you want money, go get a job.” While there is no surefire way to guarantee your parents will agree to give you an allowance, you are more likely to be successful in your request if you come to the discussion with a written budget of your expenses than you would if you tell your parents you need more money “just because.” Show your parents the expenses you would like to take over if they agreed to give you an allowance. Tell them you want to learn to be responsible for your own money.
• Stay calm. The last thing you want to do is turn this into an argument with your parents. Think about the image you want to portray. Do you want your parents to think of you as a responsible teenager who has thoroughly thought through the request, or would you rather seem like you are coming to them whining about how everyone has money except for you? Your presentation of the subject is key in getting the allowance you want. If you whine or bicker, your parents are likely to not take your proposition seriously.
• Be prepared to bargain. Your parents may have a few demands before they will agree to an allowance. Maybe they want you to start doing certain chores around the house, or perhaps they want you to achieve a certain grade point average before they will agree to give you money on a regular basis. You have to be willing to compromise. You’ll also need to stick to your side of the bargain. If you say you’ll wash your parent’s car each weekend, and you don’t, be prepared to have your allowance taken away. It’s just like a job; if you don’t show up to work, you don’t get paid.
• Keep in mind that some parents just can’t afford to give you what you want. The truth is, some parents do a pretty good job of hiding the fact they are having financial problems — especially when hiding the financial problems from their teens. So, if your parents are adamant about the fact that they cannot give you an allowance or increase the amount they already give you, you may just have to accept it for now and find another way to earn an income.
Case Study: How to Pick the Best Job
Clayton — Career Adviser
When looking for your first job, you should consider two things. First, is this a job you want to make as your career? If you feel it is the right time in life to start your career, then you should ask yourself: Is this a job you can see yourself enjoying in 10, 20, or even 30 years down the road? You should pick a job that’s right for you, and not just any job in order to have work. Secondly, consider searching for a job you can build your career on. Many people don’t stick with their first job, but they use it as a major step in gaining experience in the workplace. They also can gain personal skills such as people skills, computer skills, listening skills, and countless others. Not only can a first job help you find out new qualities about yourself, but it can also help you develop strong working skills. As your qualities and work skills grow, you can use them as a major tool in today’s workforce.
My next point touches on how to write your first résumé. When writing a résumé, you must remember that no experience is too big or small. Even such things as mowing lawns during the summer can be listed as job experience. Also, a résumé is not just a list of jobs you have had in the past; it should also should list service hours, extracurricular activities, awards, and many other things you have accomplished. Just remember:
Your résumé is not a list of what you haven’t done; it’s a list of what you have done.
My final point to discuss is the interview, which is a crucial step in the process of getting a job, because this is your one chance to show the interviewer why you would be an asset to his/her company. Even if you are applying to a fast food restaurant, the interview is important. You only have one change to make a first impression, and with this impression, you can be hired or rejected. It is important to remember this is a business meeting, so you should act and look professional. This includes such things as not wearing flip-flops or chewing gum. Watch your body language. Be careful to not look at your watch as if you have somewhere else more important to be. You can improve their first impression by looking at your interviewer in the eye to show them you care about this job, answering their questions honestly, and being yourself so they can see your great personality. When looking for a job, you should consider finding a career that will fit your interests, help you to develop good working skills, and add to your résumé. By following these guidelines, you could be on your way to the career you have always wanted instead of settling for anything that passes your way.
Getting a Job
There comes a time when an allowance just isn’t going to cut it anymore. Whether it’s because you’re heading off to college, or you want to buy your first car, getting your first job can be exciting.
The age when you can start working varies from state to state. In some instances, you can start working at a regular job around age 14 or 15, but you may need to get a consent form signed by your parents. Visit the U.S. Department of Labor’s Web site YouthRules! (www.youthrules.dol.gov) to find more information on what hours and specific jobs you can work as a teen and how to prevent workplace injuries. You may also be limited in how many hours you can work and what type of work you will be allowed to do.
You don’t have to settle for a job you hate. Many teens fall into the trap of thinking they have to start at the very bottom with a miserable position and work their way up, but this is not always the case. Of course, there may be some instances where the only job you qualify for is doing something relatively miserable, but if you are creative in your job search, you may be able to start out with a job you really enjoy.
What do you like to do? Don’t just apply for every job you can think of. Think about what interests you and then pursue a job in that field. Do you like dealing directly with people? Try a service job like a restaurant where you will be in constant contact with people. Do you adore fashion? Find a job at a retail store. Do you love horses? Apply to work at a stable. Are you artistic? Spend some time volunteering at an art museum, then apply for a part-time job there. Your options are wide open because you have not yet established yourself within a certain field. As long as you have the confidence to apply for the job you really want, there is a chance you can wind up working somewhere great.
Also, consider looking for a job that will help your résumé or college application in the future, like answering phones or running errands for a law firm. These types of jobs offer experience that may be pertinent to a future career, or to a degree you wish to seek while in college. Many young people don’t even try to get these types of jobs and instead settle for cashier job because they thing they don’t have a shot — but they do.
Why is it so important to find a job you will actually enjoy? You will be more likely to look forward to going to work, and you will probably excel much more than if you have a job you didn’t like. Working does not have to be miserable, especially if you actually enjoy what you do.
When looking for a job, it is important to impress your potential employer. In some cases, if you can impress a potential employer enough, the company may not even care about your work experience or your level of education. Play up your extracurricular activities in school — you never know when your interviewer will say, “That’s what I did in high school!” Are you a reporter for your high school’s newspaper? Are you in drama or band? If you’re in college, are you a member or a sorority or fraternity? You might be surprised by how much people associate themselves with these activities. If you come across an employer who was a member of your sorority, you might have just found your hook-up for the job.
Today, the U.S. unemployment rate is more than 10 percent. This means that 10 percent of people who want to work are not actually working. This is an incredibly large number. What does this mean for you? You will have more competition for jobs — even jobs that are traditionally held by teens or young adults, such as cashiers, cart pushers, or secretaries. Due to the current economy, many people have been laid off from their jobs and are now looking for new jobs. Unfortunately, there are far more workers than there are new job positions available. Older workers who typically have higher-ranking positions are willing to take on lower-paying jobs, and this leaves teens and young adults competing for jobs with people who may have a more impressive résumé. How do you combat this?
• Be confident. Confidence is an amazing attribute that can influence people into thinking you have reason to be confident. For example, if you apply for a job with a florist, and the florist asks you if you have any experience with arranging flowers, don’t say “No, not really.” Instead, reply with something along the lines of, “I enjoy arranging flowers for my family all the time. My family looks forward to my Thanksgiving centerpieces every year!” Don’t lie, but don’t downplay your abilities.
• Be professional. Don’t stroll into a store wearing sweats and chewing gum and ask to speak to a manager because you want to apply for a job. Dress as you would if you were starting your first day of work. Until you find a job, your job is searching for one. Write up a résumé highlighting your experiences and always dress cleanly and modestly when applying for a job or attending an interview.
• Be prepared. Practice interview skills like making direct eye contact, giving firm handshakes, and answering questions about yourself without tripping over your words. Ask your parents or your friends to conduct practice interviews with you where they ask you questions and you answer them as confidently as possible.
Once you do get a job, sign up for direct deposit if your employer offers it. This allows your employer to deposit your pay into your bank account instead of giving you a paper check you have to deposit in the bank yourself. Not only is it convenient, but direct deposit usually allows you to have quicker access to your money. Signing up for direct deposit is usually a simple process, so ask your boss about getting your pay directly inserted into your bank account.
Resources for Finding a Job
Clueless as to how to go about finding the perfect job for you? Try these helpful resources:
• Internet: The Internet is the top resource for finding a job in today’s economy. Web sites such as Beyond.com (www.beyond.com), CareerBuilder (www.careerbuilder.com), Hound (www.hound.com), and Indeed (www.indeed.com) are some of the most popular job-search Web sites.
• Your local newspaper: Almost all local newspapers have a classified section, and within that section, you will find job postings. This also might be a resource for posting notices about services you offer if you decide to create your own job instead, as detailed in the next section of this book.
• Friends and family: Sometimes, when in the midst of job searching, it’s all about who you know. Does your mom know someone who works for a law firm? Ask her to find out if they need an errand runner. Is your cousin a nurse in a doctor’s office? Ask her if they need someone to answer phones. Does your roommate work as a server in a restaurant? Ask him if they’re hiring.
Create Your Own Job
Maybe there are no suitable jobs available where you live, or maybe the thought of working for someone else doing to same thing over and over again does not appeal to you. If the idea of going in to the same place every day and doing the same thing repeatedly for a small, hourly wage really turns your stomach, but you are motivated to start working, you may want to consider running your own business.
It isn’t as complicated as it sounds. Creating your own business does not have to involve running an office or hiring a secretary. By operating your own business, you can provide services directly to one or more clients. For example, if you mow lawns for several houses in your neighborhood for money, then essentially you have your own mowing business. If you babysit for a few different families on a regular basis, you have a babysitting business. By doing this, you have found something you don’t mind doing and have turned it into a profitable activity. The same can be said for someone who makes bracelets at home and sells them at fairs, or someone hired by companies to design Web sites.
There are advantages and disadvantages to having your own business. You get to decide when you want to work and you get to set your own prices. On the other hand, when you run your own business, you are the person in charge, and therefore, you are the only person who can take the blame when something goes wrong. For example, suppose you mow lawns in your neighborhood for profit, and one day you accidentally knock over an expensive bird bath with the mower. The bird bath shatters, and the homeowner wants you to pay for the damage. If you worked for someone else, it is likely the company you worked for would pick up the cost of the damage. When you work for yourself, however, you would be the only person responsible, and would have to cover the cost of replacing the bird bath.
Working for yourself requires self-motivation. Suppose you are really good at calligraphy and create your own business addressing wedding invitations. A client pays you to address 100 invitations and wants them to be done in a week. If you wait until the last minute to start working on the project, it is likely you won’t get it done in time, or you might deliver sloppy work to your client. Neither scenario is good for your business. If your work isn’t good, the word will get around, and no one else will want to hire you.
If you are interested in working for yourself, try to think about things you like to do and how you can turn these activities into profitable ventures. If you love playing with kids, try babysitting. If you love dogs, start a dog-walking business. If you love spending time outside, offer to landscape your neighbors’ yards. There is no limit to the things people will pay you to do, especially if you live in a neighborhood where almost everyone works outside of the home and have little time to take care of things like walking their dogs or grooming their lawns.
Here is a list of some ideas you can explore when deciding to open your own business:
• Babysitter
• Dog walker
• Craft/art creator
• Lawn mower
• Car washer
• House cleaner
• Errand runner
• Baker
• Writer
• Designer
• House sitter
• Tutor
You certainly aren’t limited by this list. If you can think of something you love to do, and you know there are people willing to pay for it, go for it!
How do you know how much to charge for your services? Check out other local companies that offer the same service and see how much they charge. Make a couple of phone calls to these companies, or visit their Web sites to find out their prices. You should also charge based on your experience. If you’re relatively new at your service, consider charging less until you gain more experience. Then, once you have established your business, people will pay you more because they know they can count on your expertise. Another idea is to offer customers service plan: Allow people in the neighborhood to choose from different packages, and keep tabs on everyone with a chart and an e-mail account.
Case Study: Owning Your Own Company
Peter — Entrepreneur and High School Student
At the age of 13, I created my own company creating online Adobe® Flash entertainment. Flash allows designers to add animation and interactivity to Web sites or other software. Beforehand, I had no knowledge whatsoever as to how to manage a company, and I knew little about handling money or using it to reinvest in a business. While I didn’t profit much from my company at first, I was soon required to communicate with sponsors and Web designers in order to create Flash games and to create a Web site that would later be profitable. The creation of my company and Web site serves as an example of how any teenager can use his or her skills to earn and save money for the future. With additional education and help from my parents, I was even able to invest in plans that would pay for college and retirement.
After familiarizing myself with Flash software in middle school, I began to submit my Flash games and animations to a free online portfolio. It was then that I decided I could create my own Web site and profit from my flash content. I was soon contacted by AddictingGames (www.addictinggames.com), a subsidiary of MTV, which was interested in my games, and I began to generate sales from T-shirts and by licensing my Flash games. The majority of my earnings were put in savings, and the remainder was used to hire other freelance professionals, through sites such as Elance (www.elance.com), to assist me in redesigning my Web site and the creation of my games.
My company, E19 Industries LLC, was created in 2006. It was later dubbed “Lawlolawl Studios.” Most of my income at this point was generated by Google AdSense. About a year later, I was contacted by a representative of AddictingGames, who was interested in sponsoring my Flash game “!GNITION.” The game was uploaded to their site, and my Web site traffic increased significantly. I became aware that Lawlolawl had over 30,000 individual users on it in a single day when the server crashed, so I decided to create a way to profit from the traffic on my site. To do so, I hired a specialist that worked with me to monetize my Web site.
Because I had plenty of visitors, I set up a simple store that enabled them to buy my T-shirts straight from my site. With the money coming in from my store, I was able to concentrate on freelance Web and game design, which included the creation of Flash Web site interfaces and games. Upon the release of new Flash content, I would send a newsletter to a list of 3,000 or so clients. In this way, I could continue to have traffic on my site, as well as ensure that my Web site’s fans would purchase new products. I am currently working on a report describing how to profit from Flash games, and upon its completion, I can send an e-mail to my subscribers, offering them the product for an exclusive price.
As a child, I was taught to divide the money I received from gifts into two boxes: One, titled “temporary,” held the money I could spend whenever I desired, and another, known as the “permanent” box, contained money I would save for college. Still following a similar process, the majority of the money I make from my Web site goes immediately into savings. After my bills are paid, I may use some money to purchase new Flash software or perhaps to hire an audio professional to create music for my game. Otherwise, the majority of my earned income is set aside for later in my life. After all, although it was a great experience to create my own company and Web site, my true intentions in doing so are to save money for the future. With assistance from my parents, the permanent money that Lawlolawl Studios generates goes into my own Roth IRA account. In addition, my parents have invested in a 529 plan for college and a whole-life insurance plan, which I will own when I become an adult.
In the future, I plan on developing more ways to monetize my Web site in order to earn enough money to help with college expenses. Doing so will most likely require an expansion in my company that will tap in to my temporary savings. Nonetheless, as long as I continue to leave my permanent savings untouched, I am well-prepared for any possible financial issues. My parents have always stressed the importance of setting aside money for when you need it most. They must be right, because I have followed this principle and have come far.
Lastly, I was taught it is important to share with others who are less fortunate. Currently, I donate 10 percent of the funds generated by E19 Industries to the Costa Rican Conservation Foundation (www.fccmonteverde.org), a non-profit organization whose primary goal is to protect Costa Rican wildlife through reforestation and educate others on the importance of protecting the environment. I am also working on redesigning their Web site, free of charge. I have the tools needed to make a difference at my disposal, and I plan to continue to use them.
Get rich quick?
When you are looking for a job or you are trying to think of ways to make money by working for yourself, be careful to avoid falling into the trap of thinking there are ways you can get rich quick without working hard. If you do a quick Internet search for a job you can do from home, for example, you will find plenty of “opportunities” that really aren’t opportunities at all. These are nothing more than scams designed to lure people who are looking for work but who don’t realize that people are out to take advantage of them. You aren’t going to get rich stuffing envelopes or assembling products at home, which are just a few at-home jobs you will find on the Internet. You will probably not make a substantial amount of money by selling overpriced makeup or cleaning products to your family and friends; you cannot earn a living as an entry-level mystery shopper. Any company or individual that wants you to send money in order to learn how to make money is more than likely trying to scam you.
You should also avoid complicated financial schemes that are supposed to help people get rich quick. While it is true that people can make a lot of money doing things like buying and selling foreign currency, this is something that should be left to people who have studied the process and who have the money to spare. If you come across an ad or e-mail that says something along the lines of “Learn Money-Making Secrets!” or anything similar, don’t believe the claims. If there were truly secrets to getting rich quick, don’t you think the secret would have gotten out by now?