Jim Liebelt's Youth Culture Watch

Attention, College Shoppers: Some Schools Are Slashing Their Prices

*The following is excerpted from an online article posted on The Washington Post.

As soaring tuition scares off many families, a growing number of private colleges have embraced a marketing tactic associated more with selling airline tickets or flat-screen televisions than higher education: a price cut.

St. John’s College slashed tuition from $52,734 in this school year to $35,000 in the next.

The liberal arts school, with campuses in Maryland and New Mexico, joined more than 20 others nationwide that have reduced prices in the past three years.

The movement exposes a reality of higher education long hidden in plain sight: The difference between sticker prices and what the average student actually pays is often vast.

Twenty-three private institutions have reduced tuition since 2016, according to the National Association of Independent Colleges and Universities. “The trend is beginning to pick up,” said David L. Warren, the association’s president. These schools view cuts as “an important tool,” he said, to help them stand out in a crowded market.

Their reasons vary. Some need to bolster recruiting in the face of major financial challenges. Others want to escape a pricing formula that assumes prospective students view high tuition as a mark of educational quality even though they simultaneously seek significant discounts or financial aid.

The average sticker price for private colleges is about $48,500 for tuition, fees and room and board, according to the College Board, a nonprofit organization representing thousands of educational institutions. However, sticker prices above $60,000 a year have become commonplace, and a growing number top $70,000.

The most prestigious schools enroll large numbers of students willing and able to pay full price. Federal data show the share of full-paying undergraduates in 2016-2017 — those who received no grants — was 42 percent at Princeton University, 50 percent at Bowdoin College in Brunswick, Maine, and 57 percent at Wesleyan University in Middletown, Conn. A similar pattern held at numerous other colleges.

But many schools have few full-pay students. The Washington Post found more than 310 colleges and universities in 2016-2017 where at least 95 percent of undergraduates received grants or scholarships. (For St. John’s, the share was 97 percent on its Annapolis campus, 99 percent in Santa Fe, N.M.)

At such schools, sticker price may be more of an aspirational statement than a revenue generator.

Even so, sticker prices usually go up faster than inflation. Knowing this, students and bill-paying parents hope the increases remain manageable. Their best-case scenario would be an occasional price freeze.

Even so, sticker prices usually go up faster than inflation. Knowing this, students and bill-paying parents hope the increases remain manageable. Their best-case scenario would be an occasional price freeze.

Now, price cuts among private colleges could be signaling a pivot point in that sector.

Sweet Briar College in Virginia, which nearly closed in 2015 amid financial difficulties, cut its price 32 percent for the current school year, to $34,000 for tuition, fees and room and board.

Elizabethtown College in Pennsylvania will cut tuition 32 percent in the coming year, to $32,000 (not counting fees and room and board). The echo on 32 is not accidental. Carl J. Strikwerda, president of the 1,700-student college, said he wants to grab the attention of middle-class families.

Price cuts are risky. If they are not deep enough, they won’t get noticed. If they are too deep, colleges could lose substantial revenue. “This is not for the faint of heart,” Strikwerda said. To succeed, he said, a college must convince prospective students of the quality of the education it offers regardless of price.

Source: The Washington Post
https://www.washingtonpost.com/local/education/attention-college-shoppers-these-schools-are-slashing-their-prices/2019/01/21/e384eca0-12bc-11e9-90a8-136fa44b80ba_story.html

Raising the Minimum Wage Hurts Teen, Young Adult Employment Rates

*The following is excerpted from an online article posted on The Daily Signal.

A new study shows that raising the minimum wage has played a role in the decline of teen employment and the labor force participation rate, which has fallen by about half since 1994.

The study, conducted by the Mercatus Center at George Mason University, examined three possible factors to explain why teen employment has declined since 2000: higher minimum wages, more labor competition from immigrants, and rising returns to schooling.

Mercatus found that a higher minimum wage was the “predominant” factor in lower teen employment.

“The percentage of teens not in the labor force who reported wanting a job fell by almost half between 1994 and 2009, from 24 percent to 13.2 percent,” according to the study, “Declining Teen Employment: Minimum Wages, Other Explanations, and Implications for Human Capital Investment,” published Feb. 7.

The study found that teen labor participation rates declined much more than those of adults, which dropped about 3 percentage points, according to the study. Additionally, the study found that the labor participation rate of young adults “does not coincide with swings in economic activity.”

During the period Mercatus studied, many states increased their minimum wage, and some states raised their minimum wage “quite substantially,” according to the study, and it found that a “rising minimum wage could have priced some teenagers out of the labor market.”

A higher minimum wage is associated with a lower share of 16- and 17-year-olds both in school and with jobs, and with a higher share in school and not employed, the study showed.

There is not a positive relationship between higher minimum wages for teens and higher future earnings, the study found. Additionally, teens exposed to higher minimum wages have acquired fewer skills in adulthood since the year 2000.

Source: The Daily Signal
http://dailysignal.com/2018/02/15/raising-the-minimum-wage-hurts-youth-employment-study-finds/

Here's How Much the Typical Kid Gets in Allowance Each Year

*The following is excerpted from an online article posted on CNBC.

Piggy banks might be on the endangered species list, yet your kids still need to learn about money. They're handling a lot of it.

Kids ages 4 to 14 received an average $454 in allowance over the course of 2017, in addition to cash gifts for birthdays and holidays, according to a forthcoming survey from allowance tracker RoosterMoney. The average kid takes home around $8.74 a week.

The average weekly allowance by age revealed the following range of payments:
Age 4: $3.76
Age 6: $5.24
Age 8: $7.24
Age 10: $8.10
Age 12: $9.85
Age 14: $12.26

RoosterMoney polled 10,000 of its users.

Offering an allowance is an opportunity to teach children how to spend and save. People form many of their financial habits by seven years old, a 2013 University of Cambridge study found.

But the way these payments are doled out and stored is changing. Apps like RoosterMoney, FamZoo and Threejars offer ways to digitize the allowance and induct children into the economy, which itself is becoming increasingly virtual.

"Parents are finding it harder to have conversations about money because they don't have cash around," said William Carmichael, CEO of RoosterMoney.

Parents are actually doing a disservice to their children by teaching them about finances solely via cash, Carmichael said.

"That's not the world their kids will live in," he said.

Source: CNBC
https://www.cnbc.com/2018/01/04/digital-allowance-apps-help-kids-better-manage-money.html

Surveys Show Teens Failing at Financial Literacy

You know your teens can be illogical, unreasonable, and occasionally malodorous, but isn't it at least reasonable to assume they know the basics about money?

Apparently not. Surveys show that teens are failing at financial literacy. And while financial institutions like PricewaterhouseCoopers are investing significant resources in changing that, the problem is persisting.

From those in a position to know best—personal finance and business education teachers—here are five of the most gaping holes in teens' money knowledge.

1. Bank account basics. "My students had no idea how to figure out online banking," said Keith Newman, a personal finance teacher at Bodine High School for International Affairs in Philadelphia. Part of the problem, he said, is that there are no high-quality, up-to-date teaching tools to help students learn about bank accounts.

2. Budgeting. Students' "parents just hand them money, and they just burn through it," said Newman.

3. The power of compounding. Maggie Wohltmann, a business education teacher at Teaneck High School in New Jersey, likes to explain to her students that they all have the potential to be millionaires someday—but the odds of reaching that goal increase sharply if they save early.

4. Keeping credit reports clean. Many teens are stunned to learn that financial behavior over an extended period will affect their ability to borrow money or even obtain a credit card.

5. Rainy day savings. Whether teens come from affluent households or more modest ones, the idea of putting money away in case something happens if often novel, teachers say. "Savings shock them," said Newman. "In the end, they're pretty shocked at what they're left with" after taxes, and "what they need to save," said Kim Zocco, a business education teacher at Archbishop Edward A. McCarthy HIgh School in Southwest Ranches, Florida.

Source: CNBC
http://www.cnbc.com/id/101159834

Numbers Suggest Why Millennials Are "Generation Frustration"

86
The number, in millions according to Barron's, of millennials in the U.S. 86 million: that's 7 percent larger than the baby-boom generation.

16.3
The percentage of millennials who are unemployed in the United States, according to the United States Labor Department, this is even more alarming when paired with a Harvard study finding that just 6 in 10 millennials have a job, half of which jobs are part-time. The bottom line here is that millennials can't seem to find jobs.

1.8
The number of bachelor's degrees, in millions, that universities are expected to award during the 2013-14 school year. This is in addition to the 943,000 associate's degrees, 778,000 master's degrees and 177,000 doctoral degrees projected.

58
The percent of hiring managers in a recent survey by Adecco who say they have no plans whatsoever to hire a recent college graduate.

4.7
4.7 million jobs have been created over the past three years, according to the Jobs Report, while about 8 million jobs were lost in 2008 and 2009. The fact is, jobs aren't being created fast enough for the entire U.S., much less for millennials.

61
The average age at which current U.S. retirees said they retired, compared with 59 in 2003 and 57 in 1993. That figure is just current retirees; current non-retirees expect to delay their own retirements past age 65. Whether they haven't saved enough money or just love working, their delayed retirement means less upward mobility for millennials.

21.6
The total number, in millions, of millennials who lived in their parents' home in 2012, up from 18.5 million of their same-aged counterparts in 2007. Millennials simply can't afford to live on their own.

Source: Huffington Post
http://www.huffingtonpost.com/ryan-donegan/millennials-generation-frustration_b_3977145.html

Poll: Parents and Teens on School and College

According to two new polls (one for parents and another for teenagers):

• U.S. teenagers are much more likely to think their parents are concerned about how they're doing in school than parents seem to be.
    - Teens said they felt the No. 1 concern of parents was their performance in school.
    - Parents themselves ranked performance in school as only the fifth-largest concern about their teens, while concerns about unsafe driving ranked number one.

• When asked if teens were more likely to say they have more opportunities to get ahead than their parents did at the same age:
    - 62% of teens agreed.
    - 41% of parents agreed.

• Regarding whether it is better to be a teenager in America today than decades ago:
    - 54% of teenagers said now is the preferable time to be a teen.
    - Only 18% of parents agreed.

• Both parents (68%) and teens (81%) say they play the greatest role in ensuring teens' success in school.

• When asked about parents' involvement in teens' lives:
    - 66% of parents worried they didn't have sufficient time to focus on their kids.
    - 68% of teens reported that their parents are too closely involved in every aspect of their lives.

• Both parents and teens agreed that college provides a ticket to the middle class and that this benefit outweighs the economic burdens that accompany student loan debt with:
    - 71% of parents saying they expect their kids to go to a four-year college.
    - 69% of teens saying they expect to attend a four-year college...
although statistics show fewer than 40% of high school graduates enroll in four-year colleges.

When asked about paying for four-year degrees:
    - 66% of parents say they are counting on grants and scholarships to help finance the cost of college education.
    - 78% of teens say the same thing...
although only 40% of college students today receive Pell Grant money and far smaller numbers benefit from merit-based scholarships.

This poll, which explored how Americans assess the state of childhood and parenthood, surveyed 1,000 adults by landline and cell phones Sept. 3-7. The survey has a margin of error of plus or minus 3.1 percentage points. In addition, National Journal conducted a separate online survey of 300 teenagers ages 13 to 18 (only including 18-year-olds who are still in high school); teen participants received a small compensation for responding. The survey is reflective of the demographics of American teens, but it does not carry the same statistical validity as the random phone survey of adults.

Source: National Journal
http://www.nationaljournal.com/next-economy/solutions-bank/poll-parents-and-teens-share-often-unrealistic-dreams-about-college-20130924

Emerging College Financing Trend - Crowd Funding Websites

Rather than go further into debt for his college education, Joshsua Samuels decided to try the website GoFundMe.com, where he appealed for help to friends and strangers. Within two months, he had raised the $3,380 plus GoFundMe's 5 percent-per-donation fee.

Crowd funding, as this practice of Internet soliciting is called, is better known as the purview of startup companies looking to raise cash. Education is now the second most popular category on the GoFundMe site, says founder Brad Damphousse.

Students in need can pick from a range of sites; other popular ones are Kickstarter and Indiegogo.

Parents, meanwhile, can start crowd funding when their kids are toddlers. At GradSave.com and GiveCollege.com, which are tied into 529 savings plans, parents can solicit donations to college savings accounts.

Succeeding at getting donations requires students to be resourceful. Most sites advise crowd funders to post catchy videos as part of their campaign strategy, and they provide tools for publicizing crowd funding efforts on Facebook and Twitter.

Samuels advises setting your sights higher than the amount you need for tuition, so as to cover expenses like books and the fees you'll owe to the crowd funding sites.  "You have to raise more like 110 percent," he says. But the effort is worthwhile, he thinks, if unwieldy debt is the other option. "Go for it."

Source: U.S. News & World Report
http://www.usnews.com/education/best-colleges/paying-for-college/articles/2013/09/20/find-money-for-college-on-crowd-funding-sites?src=usn_tw

Teen Apparel Retailers Struggle as Consumers Get Stingier

Teen apparel brands have been losing their shirts, and it's not a fashion choice.

Against a backdrop of prolonged consumer stinginess, reinforced by reports of a scant monthly increase in August retail sales, an anemic back-to-school performance may herald more economic sluggishness to come.

"The economy, employment, wages and retail sales continue to stagger along," said Matthew Shay, chief executive of the National Retail Federation. "While positive retail sales growth continues month after month, it is just not strong enough to move the needle."

Although some market indicators seem to be improving — housing prices and sales are up, as are stocks — consumer confidence is tumbling, according to a measure Friday from the University of Michigan and Thomson Reuters.

"This is not good news for retail buying this autumn, and there might be no change in these conditions right into the holiday season — a projection likely to dampen spirits in the retail sector," said Kathy Bostjancic, director of macroeconomic analysis at the Conference Board.

Teen brands such as Abercrombie & Fitch Co., American Eagle Outfitters Inc. and Aeropostale Inc. are staggering out of the shaky back-to-school season shunned by jobless youth and their cash-strapped parents, pummeled by unseasonably cold weather and perplexed by hazy fashion trends.

Same-store sales for all three companies slid in their most recent quarters. Since the beginning of the year, the trio's stock prices have suffered double-digit slides. Many brands have issued dire financial warnings for the remainder of 2013.

Some on Wall Street say the drop-off is an indicator of general economic malaise compounded by the disproportionate effect on young people of the recession and its aftermath.

Source: Los Angeles Times
http://www.latimes.com/business/la-fi-teen-retail-sales-20130914,0,2998607.story

Students Get Financial Aid at Highest Rate Since WWII

More college students are receiving loans, grants and other financial aid than at any time since the debut of the GI bill after World War II, new data show.

Seventy-one percent of all undergraduate students received some type of financial aid in the 2011-12 academic year, up from 66% four years earlier (2007-08), data released by the National Center for Education Statistics (NCES) show. The average amount was $10,800, up from $9,000 four years earlier.

Most of the increase in student aid is coming from federal sources. Last year, 57% of undergraduates received some form of federal aid, including grants, loans and work-study funds, up from 47% four years earlier. Over the same period, the percentage of undergraduates receiving state aid or help from their college remained relatively flat, at 15% and 21%, respectively.

Other findings from the 2011-12 academic year:

• 59% of undergraduates received grants averaging $6,200, up from 51% four years earlier when the average was $4,800.
• 42% of undergraduates took out loans, borrowing an average of $7,100, up from 39% who borrowed $7,000 on average.
• Seventy percent of graduate students received aid, averaging $22,000, including loans.

Source: USA Today
http://www.usatoday.com/story/news/nation/2013/08/20/student-aid--amounts-increasing/2677237/

Fewer Parents Can Pay College Tuition

As families continue to recover from the recession, they're relying less on their own income and savings and more on grants and scholarships to finance a college education than in previous years, according to Sallie Mae's How America Pays for College study.

The study, which surveyed a group of 1,602 undergraduates and parents of undergraduates earlier this year, shows that grants and scholarships are used more than any other type of funding, covering 30% of total college costs for a typical family. Five years ago, only half of families reported using grants and scholarships to pay for college. This year, two-thirds of families did, the study shows.

Meanwhile, parents are contributing less of their income and savings toward college costs, covering 27% of college costs compared with 37% in 2010, the study shows.

"The post-recession reality is (parents) don't have the income and savings," says Sarah Ducich, senior vice president of public policy at Sallie Mae. "It's not that they're not willing to stretch. It's that they don't think they have the money to do that."

Source: USA Today
http://www.usatoday.com/story/money/personalfinance/2013/07/22/recession-college-tuition-savings-plans/2569809/