Young and Financially Dangerous?

I was researching on teenage profiles for my speech assignment due next week when I chanced upon some unpleasant indictments of adolescence. Most websites are chiding adolescents as illogical and emotional (TIME.com), impulsive (McLean Hospital in Belmont) and Cognitively Egocentric (Prevention.com). With so much scientific data to back their claims, they almost made me believe that I am nothing but a financial ruin in the making at age 21.

Teens Behaving Badly

With these characteristics, teens with expendable money are cash cows for the milking to the retail industry. Being impetuous and illogical, we are more susceptible to impulsive purchases at stores. Business Week Online found teens to be spending $100 per week in fashion and fast food chains like Abercombie and Mac Donald's last year. Worse still, an average college student will amass four to five credit card debts and a whole lot of other consumption debts by the time they graduate from school. To top it off, a group of 150 high school students were tested on personal finance, with results revealing that teens know next to nothing about personal finance. No wonder retail store owners and credit card companies are laughing their way to the banks.

Even the smartest of teens is not spared from the phenomenon of peer pressure, or Groupthink, as my Leadership and Teambuilding Professor will term it. Sometimes, it is easier to follow the crowd and do what they do – spend money. Can you imagine the amount of courage you will need to be a fashion trendsetter in your clique? One wrong coat or pair of jeans and out the clique you will go. Peer pressure can defy reason. Just ask any youth who started his first puff of the cigarette stick. He knows what damage that single puff can do to his body, yet he took up the habit just to fit into a clique of friends. Emotional teens are fierce conformists within cliques and staunch rebels out of it.

Peer pressure plays right into the hands of the retail giants. They put up huge posters of visually appealing teenage girls and guys decked out in their latest fashion lines all over their stores and in public spaces. These posters ask the same question, 'With so much beautiful teens wearing our clothes, shouldn't you have them too?' Hence, the stuffed cash registers of stores keep ringing, while the thin wallets of teens keep emptying. We spend practically every allowance dollar and summer job pay-check, as well as borrowed money, on our needs to affiliate with the hip and the cool each week.

The bad news is that these bad spending habits follow us into our adulthood. As the saying goes, 'Good habits start young.' So do bad ones. But all is not lost with these bad vibes on the net. Being young does not mean that we are big squanderers of money; we can be big makers of it too.

Weird Behaviours are Good

We would have thought that our brains are fully developed by the time we utter the alphabets and know the algebra. But a TIME magazine report on adolescence would beg to differ. Our grey matters apparently re-construct itself at puberty, between the ages of 11 to early 20s. Our pre-frontal cortex, the seat of logic and reasoning in our brain, is the most severely affected. As such, our amygdala, our seat for impulse, takes over the control of the mind. A research by Mc Lean Hospital in Belmont, MA would attest to this finding. Several teens and adults were tested on a handful of human expressions synonymous with anger. The majority of tested teens interpreted them as expressions of confusion and sadness, and on the other hand, adults with fully developed pre-frontal cortices correctly assessed the displayed expressions as anger.

With such chaotic minds, logical adults therefore deem impulsive teens as defiant and irrational. But it is this same set of 'weird' behaviours that enabled the human race to evolve over time. The risk-taking nature of the first early human adolescent drove him to leave the African plains, and set foot on all continents of the world, save for Antarctica. He helped us pool our genes together and enabled human evolution. That is why we are so intelligent vis-a-vis other species of animals. Remember, 40 years old apes did not travel out of Africa, it was the young and bold who did. Being impulsive is not necessarily bad. Our impulses allowed us to accomplish things beyond normal human logic. The first step of a baby began with an impulse; an illogical conclusion that he can walk, no matter how often and how hard he falls. Hence, his first step. Can you imagine if this impulse never occurred in babies' minds? We will have 'side-crawls' now, not sidewalks. Likewise, financial success begins with an impulse; an illogical conclusion that we can be rich, no matter what obstacles we face along the way. Like a baby who refuses to give up his impulse to walk, teenagers with similar stages of mental re-wiring can also be rich.

Prevention.com describes Cognitive Egocentrism as the thought that 'bad things happen to others, not to me.' Cognitive Egocentrism is the reason why teen delinquency is up by 13%, teen pregnancy up by 10% and teen drunk drivers are up by 9%, according to the National Bureau of Statistics. But Cognitive Egocentrism also allows us to dream big, seemingly impossible dreams, like having a personal goal of getting rich and retiring at age 45. According to a study by the Ministry of Manpower in 2004, two in three adults who reached the legal retirement age of 65 are either dead or dead broke. They are dead due to stress induced diseases and they are dead broke since they are penniless by the time they retire. As a Cognitively Egocentric teen, I believe I can be that one out of three individual who can retire comfortably because ‘bad things happen to others, not to me’. Hence, Cognitive Egocentrism can be played to our advantage. As a caveat, however, being cognitively egocentric about pre-marital sex is dangerous. If you really have to give it a go and you are pondering about the use of a condom, don't even think, just use one. Get another on hand for good measure as well. Having a couple of kids before you can curb your own lavish spending habits is no joke for your teenage pocket.

Teens succumb to peer pressure easily, and retailers know it. Mr Hideki Akiyoshi, the founder of Style Factory, a fashion and event consultancy firm, says it best, 'Teens conform within a fashion clique, and are defiant out of it. Knowing what's in and what's not for them is the first step in making fashion hits with teens.' Besides burning a hole in your pocket and defying your intelligence to engage in meaningless activities like smoking, being a fierce conformist has its financial benefits. If you belong to a clique of friends who are focused on getting themselves rich that is. But first you have to find these visionaries and leave your money squandering friends behind. It is painful, I know. But so are 4 to 5 credit debts at graduation and the monthly chore of stooping low to ask for financial aid from your parents. The books that you read and the people that you associate with will determine who you are in 5 years’ time. Being fierce conformists in the right cliques, and defiant out of it, will define your financial success in life.

Do Not Believe Everything

Most adults have pre-frontal cortices that are too well-developed. Imagining financial success in life the way risk-taking teens can is ‘weird’ behaviour to them. Armed with facts from the pervasive media, most adults would therefore conclude that teens are financially precipitate, sexually impetuous and emotionally unstable. In short, we are young and dangerous. However, the adult dominant media is not right all the time; our chided characteristics can be our gifts to financial success. Do not let your chance slip by, for your impulse for success will soon be outgrown by your developing adult logic.