Jim Liebelt's Youth Culture Watch

US Holiday Spending May Be Cut Again: Survey

Two-thirds of U.S. adults plan to spend less this holiday season and 6 percent say they still are carrying debt from last year's holiday purchases, according to a new Consumer Reports Holiday Shopping Poll released on Thursday.

As recession lingers on Main Street and job losses mount, 65 percent of Americans say they plan to cut overall holiday expenses such as gifts, travel and entertaining.

In last year's poll, 76 percent of shoppers said they planned to cut back on holiday spending.

About 13.5 million consumers, or 6 percent of Americans, have yet to pay off debt rung up during the 2008 holiday season, a result that is virtually unchanged from last year's survey.

Source: CNBC
http://www.cnbc.com/id/33529078/

Act Keeps Credit Card Firms Off Campus, Away From 21-Year-Olds

For years, banks have set up booths on college campuses, hawked T-shirts and given away food to students if they would fill out a credit card application.

"Issuers have aggressively marketed cards to college students because they know that many parents will pay off the bill if the student runs up debt," said Bill Hardekopf, chief executive of LowCards.com. "In addition, brand loyalty is determined early in life, so many young cardholders keep their first card for many years."

But some students who got a credit card didn't know how to manage the credit and got themselves deep into debt. A recent study by Sallie Mae, the nation's largest student loan lender, found the average credit card balance for college students has grown to $3,173.

But starting in February, it will be harder for students to get credit cards.

That's because the Credit Card Act passed this spring will prohibit credit card issuers from lending to anyone under the age of 21 unless he or she has a co-signer or has proof of their ability to make payments.

In addition, unsolicited card offers will be prohibited to everyone under 21, and credit card companies can't entice students into signing up for a credit card with any tangible item anywhere on or near a college campus or at a college-sponsored event.

Source: Dallas Morning News
http://www.dallasnews.com/sharedcontent/dws/bus/stories/100509dnbusperfi.367411c.html

Should Your Teen Have a Credit Card?

A federal law taking effect next year will tighten rules about issuing credit cards to people under the age of 21. This will surely reduce the number of credit cards being issued to teens. But, is this a good idea? There are solid arguments on both sides of the issue. In the following article excerpt from the Wall Street Journal, the author, Sue Shellenbarger, makes a case against the conventional wisdom of limiting teen access to credit cards, noting that the key to responsible teen credit use appears to be good communication with parents about money, credit and responsibility.

Blaming credit cards for young adults’ money woes is popular these days; high-school and college students are putting way too many college expenses and other charges on their cards, the thinking goes.

But as credit-card issuers and Congress race to crack down on over-borrowing, do we risk barring the door so tightly that teens miss out on opportunities to learn financial responsibility?

In a recent article that bucks the popular wisdom about teen credit-card use, my colleague Karen Blumenthal cites a study that suggesting credit cards may be merely a scapegoat for a lack of family communication about money. Kids with credit cards aren’t the reckless spendthrifts they’ve been portrayed to be, the study shows. College freshmen with credit cards carry only a $169 balance, on average, says this 2,000-student study at the University of Arizona. And more than 60% of the credit-card holders demonstrated exemplary credit management skills, paying the bill in full every month.

To be sure, 70% of all the students surveyed (which included both teens with and without cards) showed bad financial judgment at times, failing to pay bills on time, maxing out credit cards or taking payday loans. But the credit-card holders were no more or less likely to commit these errors than students who lacked plastic. Instead, the significant factor was whether students had good communication about money with their parents; those who did, also had more control over their finances.

Source Wall Street Journal
http://blogs.wsj.com/juggle/2009/07/27/should-your-teen-have-a-credit-card/

For more information about teens and credit, see Jim Burns' article "Teens and Credit: Handle with Care" on HomeWord.com.

Parents Send Kids To Camp Grandparents For Savings

Despite the financial motivation behind parents sending their kids to visit grandparents this summer instead of sending them to camp, there are other benefits. Chief among these are kids having opportunity to spend time with their grandparents! Our society has changed much over the years and the days of kids having easy access to interaction with grandparents is no longer normative. So, recession aside, I'm all for parents taking up this inter-generational opportunity for grandparents to spend more time with their grandchildren.

Over the river and through the recession to grandmother's house they go. The lingering recession is forcing cash-strapped parents to cancel camp for the kids. Instead, they're being packed off to their grandparents'.

The hundreds of dollars a week that would have paid for camp are being diverted to more essential needs -- groceries, electricity and house payments.

The arrangement shifts the child-care burden to grandparents, many of whom enjoy the extra time with their grandchildren. The kids' parents save money and get some time to themselves. And the grandkids get more love and attention, and better food.

"If this economic trouble is bringing people together, that's a positive," said Georgia Hope Witkin, associate professor of psychology at Mount Sinai Medical Center in New York and a contributing editor of the Web site Grandparents.com.

The American Camp Association reports registration numbers are down at some of the nation's 12,000 camps, but it's too early to estimate overall attendance this year. Reports from around the country point to lower turnout from Maine to Florida to Texas and elsewhere.

"Grandparents are the new summer camp," Witkin said.

Source: Baltimore Sun / Associated Press
http://www.baltimoresun.com/business/bal-grandparents-0720,0,3566561.story

No. 1 On Back-To-School Shopping Lists This Year: Bargains

Coupons and discounts will be the hottest styles for back-to-school shoppers this year.

Summer is not even half over, but retailers throughout the Southland are gearing up for back-to-school season with new youth fashions, nifty office supplies and steep bargains.

"All eyes are shifting to back-to-school -- it's the only catalyst where consumers have to go out and spend between now and the holiday shopping season," said Ken Perkins, president of research company Retail Metrics Inc. But "you look at things heading into the season, and the macro picture on the spending front isn't promising. It's really going to be need-based, bargain-based, discount-based shopping."

The depressed economy will cause 85% of Americans to make changes to their back-to-school plans this year, according to a survey released Tuesday by the National Retail Federation trade group.

The average family with students in kindergarten through high school is expected to spend $548.72 on back-to-school merchandise this year, a decline of 7.7% from $594.24 last year, the survey found.

Total back-to-school spending is expected to reach $17.42 billion.

Source: Los Angeles Times
http://www.latimes.com/business/la-fi-back-to-school15-2009jul15,0,2866418.story

Teens Slash Clothing Spending

Piper Jaffray's new "Taking Stock With Teens" survey has confirmed what teen retailers have been reporting: Among the 8,100 teens surveyed, with a median age of 16.7 years, spending on clothes is down 19%.

A bigger surprise, however, is that they are actually spending more on shoes -- a 9% increase, according to the 17th semiannual survey, and 8% more on accessories. In fact, shoes are hot: "Footwear posted the strongest year-over-year and sequential results at a 4% and 21% gain respectively," the Minneapolis-based brokerage firms says in its report -- "an indication that the strong footwear cycle, particularly relative to the weakness in apparel, continues for the youth demographic."

Overall, teen spending fell 14%. "The decrease in spending leads us to believe that the economy is forcing parents and teens to cut back on spending across the board," the report adds. "Teens and their parents are still buying new clothes, footwear and accessories, but are more selective and increasingly price-conscious. This will force retailers to discount prices and offer unique promotions to keep a steady flow of spending until the economy improves."

Source: MarketingDaily
http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=104876

Survey: Teens Feeling Economic Pinch

Teens are feeling the impact of the economic crisis in a big way. Some 53 percent say they’re choosing activities that cost less money, 50 percent say they talk about the economy with their friends, and 14 percent of kids ages 15 to 17 say they contribute money to their family budget, according to a new survey by Junior Achievement, which has kept a financial pulse on U.S. teens for the last decade.

The results of the 2009 Teens and Personal Finance poll—sponsored by Junior Achievement—demonstrate a strong need to teach kids about financial literacy. “Teens are indicating feelings of uncertainty and anxiety about the economy and its effect on their lives,” says Jack Kosakowski, president of Junior Achievement USA, a nonprofit organization dedicated to educating kids about workforce readiness. “Possessing and using sound money management skills can help young people feel more in control of their futures.”

The survey, conducted in partnership with the Allstate Foundation, an independent charitable organization funded by contributions from subsidiaries of the Allstate Corp, also found that 33 percent of teens said there seemed to be fewer jobs available, 29 percent said the economy was causing them anxiety, 18 percent say they’ve lost a job due to the economy, and 15 percent said they’ve reduced extracurricular activities as a result of the economy.

When it comes the impact at home, 77 percent say their parents talk about the economy more than they used to, with close to 50 percent saying that their parents had discussed family finances with them as a result of the downturn.

Source: School Library Journal
http://www.schoollibraryjournal.com/article/CA6646880.html?industryid=47078

Teens Looking To Discuss Economy With Parents

The current economy has opened the door for parent-teen discussion. Take advantage of this opportunity for communication with your kids!

A recent study has revealed that 70% of teens have discussed the state of the economy with their parents. 47% said that they would like to talk to their parents more about the issue. The study was conducted by the Scarborough Kids Internet Panel of Scarborough Research.

Source: Center for Media Research
http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=101233#comments

New Survey Shows Difficult Economic Times Taking Toll on Tweens Too

A new "Tweens and Allowance" survey released today by leading tween research, consulting and marketing company, AK Tweens, shows the trickle-down effects of the current economic downturn have reached even the youngest marketing demographic.

The survey, conducted by AK Tweens, through AllyKatzz.com, the country's largest safe social networking site exclusively for tween girls, surveyed AllyKatzz.com members, ages 8-15, from around the country on issues related to tween allowance, tween spending and family spending.

Most notably, results show a 16% decrease in the number of tweens who receive an allowance from their parents, as compared to 2008. Of those who continue to receive an allowance, more than half -- 59% -- plan to save some or all of their allowance for a rainy day, a 13% increase from 2008 when only 46% planned to save some of their allowance.

Additionally, what they plan to spend their allowance on has also changed -- not insignificant when you consider that there are 28.5 million tweens in the US today who independently spend $51 billion annually and have considerable "sway" over another $170 billion spent on them by parents and family. In 2008, tweens planned to save for clothes, the future and iPods, in that order. Now, the future is what they plan on saving for the most, followed by clothes, and cell phones taking the place of iPods in the third slot.

Unlike teens, tweens are too young to get jobs and make their own money so they remain dependant on their parents, who are feeling the crunch as well. In fact, 63% of tweens surveyed said their parents have cut back on overall spending since this time last year, with family travel (50%), 'fun foods' like snacks and sodas (48%) and clothes/shoes (46%) taking the biggest hits.

Source: MarketWire
http://www.marketwire.com/press-release/Ak-Tweens-951227.html

Pre-Paid Debit Card + Social Networking = Facecard

Interesting combination...

Facecard , launched byedo Interactive and Mastercard, is a new prepaid debit and gift card aimed at Gen Ys and Millennials. Like other prepaid debit cards it appeals to parents who want to introduce their tweens and teens to spending freedom while also teaching them financial responsibility (with the benefit of protection: there is no possibility to rack up overdraw charges with a prepaid card). However, for this plugged in group, facecard's unique draw is its online social networking component.

Card members create a customizable profile on the facecard site which allows them to connect with other members and ultimately electronically send and receive funds from friends and family. Sharing money electronically definitely makes sense for a generation that loves to give virtual gifts on social networking sites such as Facebook (where gifts are icons meant to beautify the recipients profile page) and with whom microlending is a growing trend.

Crucial to connecting with young people today, facecard has a multiplatform approach that merges online, mobile and real world. Accounts can be managed via the website, by mobile phone or at the good ol' brick and mortar bank. When money is transferred to an account it is available within 15 minutes - that means that kids can call their parents from the mall and have money on their card before they leave the dressing room.

Source: Trendcentral
http://www.trendcentral.com/Webapps/App/SnapShots/TodayArticle.aspx?redir=2&nlr=354&f=3e47b75000b0924b6c9ba5759a7cf15d