Advice to take to the bank

 

With the nation’s financial system knocked off balance by risky lending and investment practices, students from UIndy’s School of Business put their financial acumen to use this year in service to low-income city residents.

Beginning in January, the Shepherd Community Center on Indianapolis’s east side provided the setting for weekly tax and savings counseling sessions provided by UIndy undergraduates, who offered common-sense suggestions informed by their coursework.

UIndy business students Nick Williams (left) and Blair Webb offer financial advice to a neighborhood resident at Shepherd Community Center on Indianapolis’s east side.

An eye-opener

“It’s been an eye-opening experience,” said Andrew Wagner, a junior accounting major from Osgood, Ind.

“I’m amazed at how little some people have,” he says. “Where I’ve lived, I’ve never had interaction with people in those circumstances.”

Wagner spent the spring semester helping eastsiders prepare their tax returns through the IRS’s Volunteer Income Tax Assistance program.

Accounting Professor Kay Poston used the VITA program as the basis for an independent study course in which students provide counseling while collecting data about community needs.

The University’s involvement grew after the center’s staff expressed concerns that, in previous years, their clients had frittered away their tax refunds on entertainment and luxury items.

Assistant Professor of Finance Rachel Smith designed a separate, independent study course in which three of her students staffed an information and referral desk each Saturday throughout the spring semester.

While the filers waited for their returns to be processed, students talked with them about their financial habits—many do not have bank accounts—and the value of saving rather than spending.

Generating interest

Blair Webb, a junior finance and accounting major from Avon, made a point of displaying a chart that illustrated how savings can grow by generating interest.

“If anything will get their attention, that usually does,” Webb said. “If they can just put away a little each month, it compounds.”

The students referred clients to the center’s household finance workshops, which then saw a jump in attendance.

They also pointed clients toward Bank on Indy, a joint venture by city officials, United Way of Central Indiana, financial institutions, and other organizations to guide Indianapolis residents in establishing accounts at legitimate banks rather than relying on expensive check cashing and payday loan services.

Bank on Indy is spearheaded by Winnie Ballard, wife of Indianapolis Mayor Greg Ballard. Impressed with the students’ work, she began to meet with UIndy faculty to develop collaborations.

Peer advisers

At her request, the School of Business is developing a program to train peer advisers for Bank on Indy and evaluate its effectiveness in persuading city residents to handle money more wisely.

Meanwhile, professors Smith and Poston plan to expand the counseling sessions to other sites. They’re making presentations about the effort at regional and national meetings of the American Accounting Association.

The initial foray was successful on many counts, Smith said, and an enriching experience for students.

“They were able to put theory to use in a real-world setting,” she said.“And they really were able to feel that sense of service that we value so much at UIndy.”

School of Business outreach effort sparks collaboration with city, service agencies.

Entrepreneurship: It’s not just for business majors

Call it made-to-order education.

Amid news of layoffs, bankruptcies, and recession, UIndy students increasingly began to realize they couldn’t trust all their career hopes to the benevolence of employers.

Several came to entrepreneurship and marketing instructor Stanley Osweiler for suggestions.

“They were saying, ‘It’s becoming more evident that I may have to be more responsible for my future,’” he recalls.

The result, to begin this fall, is a five-course entrepreneurship minor that is aimed not only at business majors but also at students in other disciplines.

Students emerging from the program will have substantial preparation and real-life experience in hatching a business concept and selling the idea to potential lenders and investors, an opportunity that has drawn interest even from health sciences and arts majors.

The program incorporates courses already offered to UIndy’s entrepreneurship majors.

The first two courses take students through the process of conceiving a product or service and developing a business plan, including an analysis of industry trends, management issues, and financial risk, as well as a three-minute pitch geared toward obtaining the necessary capital to carry out the idea.

“If you need money, who do you talk to and what do you say when you get there? We hammer that in for two semesters,” Osweiler says.

The third course takes lessons beyond the hypothetical. Students must flesh out one of their previous business ideas and present it to actual lenders, obtaining approval for a loan—or three rejections.

“This really pushes them out into the community, and it does get people outside of their comfort zones,” Osweiler says. “When it’s announced at the start of the semester, you get a little of the deer-in-the-headlights look.”

The fourth course also gets students off campus, requiring them to interview and write about the experiences of three entrepreneurs: one in manufacturing, one in a service industry, and one in the not-for-profit sector. The series wraps up with a case study analysis.

“Whether or not they end up owning their own business or going to work in a corporation,” Osweiler says, “learning the business planning process is an incredibly valuable skill to develop.”