James Cunningham gave away over a hundred dollars during his lecture “Funny Money” last Tuesday. Presented in the LSC Ballroom to a couple dozen self-proclaimed “broke” students, his financially savvy tips and slide show were presented in a fun, accessible way.
In addition to being able to perfectly re-enact the teenager’s reaction to birthday money, Cunningham is a comedian, as well as President and CEO of Funny Money, Inc.
According to Cunningham, by borrowing money from parents or using credit cards, “you’re creating a false sense of your economy.”
This false sense of money is a pitfall for many between the ages of 16 and 24. Young adults in this particular demographic spend around $100 billion per year, while only making around $5.6 billion. The major difference in funds has to come from somewhere, and it is not going to come cheap.
“If Mom and Dad are your primary source of income, you guys have what’s called five-pocket syndrome. You’ve got all this money coming in from all over the place and you don’t know where it’s coming from,” Cunningham said.
Credit cards, a staple for those strapped for cash, are one major potential pitfall. Rather than accrue debt, users should see credit cards as a tool to build credit.
“In your twenties you’re going to become major borrowers to buy cars, houses, etc. If you set yourself up properly now by building up your fico score, you’re building credit- pay back your debts quickly” Cunningham said. “Use credit cards, don’t let credit card companies use you.”
Another big mistake teens make is having too many credit cards in their possession, especially high-interest store cards.
“At no point in your life do you need more than two major credit cards- one as a primary and one as a back-up,” Cunningham said.
Another smart idea is to invest early in stocks, bonds, mutual funds and other items whose value increases over time.
“Rich people do one very important thing that we don’t do: they buy things that increase in value,” Cunningham said. “When was the last time beer shot up in value?”
To win the final $100 prize, two men and two women were selected to compete in a money-themed dance off. Moves included “walk in the club, take your wallet out, pass the cash,” “swipe the visa, shake the head,” and “grandma robs the bank.” The winner, Jason Lamb, won via applause after performing, as Cunningham said, “quite possibly the most Caucasian dance ever.”