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The Frugal Teenager, Ready or Not
Jan Hoffman, New York Times
… Indulged. Entitled. Those labels have become hot-glued to middle-class and affluent teenagers born after the last major economic downturn, in the late 1980s. They were raised in comparatively flush times by parents who believed that keeping children happy, stimulated and successful, no matter the cost, was an unassailable virtue. A 2007 study by the Harrison Group, a market research firm in Waterbury, Conn., found that nearly 75 percent of parents caved in to their children’s nagging for new video games, half within two weeks.
But as the economy totters, many families have no choice but to cut back, which may lead to a shift in their thinking about money and permissiveness. Last week a semiannual survey of 7,000 15- to 18-year-olds by Piper Jaffray, an investment bank and research firm, showed that annual discretionary spending by teenagers, whose money comes from allowance, gifts and part-time jobs, had dropped 27 percent to $2,600, from its spring 2006 peak of $3,560.
“Parents are suddenly saying ‘no’ and their kids are saying, ‘What do you mean?’ ” said Robert D. Manning, an economist at the Rochester Institute of Technology and author of “Credit Card Nation.”
These are difficult conversations. Panicked, stressed parents are struggling to explain and impose restraints, just when teenagers are expecting more spending money, not less. Many adolescents respond with anger at what they see as a bait-and-switch world, fear for their families and confusion about budgeting.
… American teenagers, many of whom have weak quantitative skills, are generally naïve about finance. In a 2007 study for Charles Schwab, the financial services company, 62 percent of teenagers believed they were prepared to deal with the financial world after high school. That boast was undercut when they were probed about topics like check-writing and paying bills.
One recent morning, students in an economics seminar at Elisabeth Irwin High School, a private school in Manhattan, displayed an emerging grasp of the financial meltdown. But when discussing their personal finances, many just seemed bewildered.
… They all felt the pressure and the desire to acquire: their knowledge of brands and prices was encyclopedic.
… But for some families, he added, the financial crisis has been a rallying point, compelling them to articulate values and priorities for the first time. An unemployed father, he said, learned to speak with his teenagers “in such a way that they wouldn’t panic, but gave them a sense that he was going through a different journey, not one just filled with success.”
… Anecdotes like these prompt economists and therapists to find something positive in all the economic turbulence. “The sooner we have these conversations in the family and as a society,” said Dr. Manning, the economist, “the sooner we can focus on core values, and have a more realistic dialogue about the meaning of happiness and money.”
(10 October 2008)
China lung disease ‘to kill 83m’
Jill McGivering, BBC News
A US study has suggested that more than 80 million people in China will die in the next 25 years as a result of lung disease. The research says the vast majority of those premature deaths are preventable.
The study focused on the devastating impact of smoking and the widespread practice of burning wood or coal at home for cooking and heating.The Harvard School of Public Health research looked at a 30-year period, spanning the last five and the next 25.
Respiratory disease is already a leading cause of death in China, but this latest study suggests a startling rise.
(3 October 2008)
Nonprofits, charities brace for the worst
Julian Guthrie, San Francisco Chronicle
At the Curry Senior Center in San Francisco’s Tenderloin, which serves breakfast to hundreds of low-income elders every day, peanut butter for the toast is now a thing of the past. It is a $5,000 annual cost the center can no longer afford.
At the William and Flora Hewlett Foundation in Menlo Park, staff meetings are planned for the next three weeks to look at how the $8 billion organization – one of the biggest charities in the nation – will meet all of its pledges next year.
The economic downturn is hitting Bay Area foundations and social service providers hard. Charities are faced with cutting services at the same time people need more help.
“We just toured the Second Harvest Food Bank in San Carlos and heard the director say she’s seeing former donors and former employees come in for help,” said Emmett Carson, CEO and president of the Silicon Valley Community Foundation, which has $1.7 billion in assets (having lost $9 million in the recent market downturn) and serves Santa Clara and San Mateo counties. “That was a pretty telling statement.”…
(10 October 2008)
