Advisor gives students a lesson in financial reality

(Editor’s note: This article is one of a series in honor of April as Financial Literacy Month.)

Financial service professionals not only provide advice to clients – many of them also are small-business owners as well.

Tari Trowbridge shares her experience of establishing and running a small business with high school students in her community, to help educate them on the realities of the business world.

Trowbridge is owner and founder of Trowbridge and Co. Wealth Management Group in Towanda, Pa.

“I went into a class of students in Grades 11 and 12, where students were asked to choose a business they might be interested in starting, create a budget and then talk to someone who is in that business about the challenges and rewards of being a small-business owner,” she said. “I answered questions and shared some of my experiences.”

Trowbridge said she was surprised by some of the discussions she had with the students.

“Most of the students had no idea of all the things that you as a small-business owner have to pay for, the multitude of decisions you have to make and all of that,” she said.

“A lot of them wanted to know how and why I got started,” she said. “I explained that I worked for a bank for 17 years and I wanted to go off on my own and start my own business – so the insurance and financial services business wasn’t completely foreign to me. One of the lessons I said you should take from that is that you don’t have to start from nothing. If you are interested in a particular business, go work in that business and see what it’s all about before you decide to spend a bunch of money trying to do it.”

The tough financial realities

Trowbridge said she was careful to explain some of the tough financial realities of starting a business.

“I told them that when I first started out, there were some weeks where I didn’t make anything and I didn’t get paid. I had just enough money to pay my worker, and I needed the students to understand that. They had to understand that in the beginning, it’s hard. Sometimes you don’t get paid anything. I think that’s sort of a revelation for them, like a lot of times people like to work for someone else because they know that paycheck will be there. There’s a lot of risk involved in going out on your own.”

During her years working for a bank, Trowbridge often talked to students about the financial realities of everything from paying for college to making decisions on careers and how to afford a place to live after their school years were over.

“I developed a program where I would talk to students in Grade 6, and first I would talk to them about all the bills you have as an adult and how paychecks work and about taxes – things like that,” she said. “And I would have them choose a house and decide whether to buy or rent, and consider a career and pick out the kind of car they wanted to own and then work out a budget to see whether they could afford all that.”

It was a lesson in financial reality that hit many of the students hard. “Ninety percent of the time, the student’s budget was in the red.”

Trowbridge said her sister is a nutritionist and the two of them have one thing in common with respect to their careers.

“I always say, we have the same exact job, and that is to convince people to delay current gratification for a good, long-term result. Whether it's spending money or eating something, it's the same thing. It's having long-term discipline.”

 

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