Millionaires show tough love to heirs

A recent study shows American millionaires are giving their heirs a dose of tough love.

New data shows that 82 percent of American millionaires feel each generation should be responsible for creating its own wealth -- up significantly from the 65 percent who said that in 2007, according to studies commissioned by PNC Wealth Management.

And raising successful and hard-working children was priority No. 1 for 84 percent of respondents, up from 75 percent in 2007.

"It's human to want your children to have a better life than you have had, but too much financial support...might have negative longer term consequences," said Steve Pappaterri, senior PNC's managing director of wealth planning, in a statement.

"Ultimately, parents want their children to make their own way in life."

Some more interesting findings from the study:

• Post-recession sentiments: One-third of millionaires anticipate a decline in the wealth they expect to pass on to the next generation, according to PNC's Wealth and Values Survey. But nearly half of respondents said they expect to pass on at least $500,000 of wealth to their heirs.

• Financial legacies: Millionaires expect their finances will be a significant part of their personal legacies. And 86 percent intend to leave something for the next generation, be it passing on property, family heirlooms or ownership/participation in a business. Nearly 50 percent of millionaires expect to pass on assets via trust fund. 

• Transfer of wealth: Most wealthy households have at least some plans in place for transfer of wealth: 82 percent have wills, 52 percent have trusts and 52 percent have estate managers. Among wealthy business owners, however, only 15 percent have a formal succession plan in place. 

• Childhood financials: Seventy-five percent said their financial situation growing up was average, 12 percent said they grew up poor, and another 12 percent said they grew up wealthy. 

• Generational assistance: Sixty-seven percent of millionaires said they got help from their parents, and 91 percent of them plan to do more for their children. With rising education costs, 84 percent said they have or expect to financially support their children's higher education. Many millionaire parents said they strongly support purchases such as a car (61 percent) and down payments on homes (45 percent).

Conducted in August and September 2012, the study included more than 1,100 interviews nationwide, including 560 people with assets of $1 million or more. 

Bank of America lent $8.7 billion to small businesses in 2012

Bank of America announced Wednesday that it extended nearly $8.7 billion in new credit to small businesses in 2012, an increase of 28 percent over 2011. The bank also reached its goal of hiring more than 1,000 small business bankers nationally – part of a pledge Bank of America CEO Brian Moynihan made to the White House in late 2010 to increase lending to small businesses. 

Both efforts are part of the Charlotte bank's broader push to increase services and lending for small businesses. 

Though small business lending is still a relatively small piece of the bank, Bank of America reports its combined new and renewal small business lending totaled nearly $20 billion. 

According to Bank of America's recent Small Business Owner Report, 69 percent of small business owners are reaching out to financial experts for help. 

The bank has met with more than 300,000 small business owners since the beginning of 2011, says Anna Colton, small business banker national sales executive for Bank of America, in a statement. 

Upcoming workshop: Networking for women

The Charlotte chapter of the National Association of Women Business Owners will host a networking workshop at its meeting Feb. 5, designed to help women business owners build relationships with other entrepreneurs and community organizations.

Sybil Melton, the area director consultant for Business Network International, will lead the workshop, teaching business owners to mix 21st-century networking with the tried-and-true methods, and craft an engaging intro that shows just what their business has to offer.

Melton, who now lives in Sherrills Ford, has owned and operated three companies.

NAWBO is a professional organization created to offer resources for the 42,000 women-owned businesses in the greater Charlotte area.

Event details:

Who: Open to the public.
When: 11:30 a.m.-1:15 p.m. Feb. 5.
Where: Byron's South End, 101 West Worthington Ave., #110.
Cost is:
-Members: $30 until Jan. 30; then price goes to $40.
-Non-members: Cost is $40 until Jan. 30; then the price goes to $50.

Make reservations here. For details: 704-367-3454.

Franchising industry continues to grow

The franchise industry is still on the rise, according a recent study by the International Franchise Association.

The study shows that in 2012, the number of franchise establishments in the U.S. increased by 1.5 percent. The IFA predicts the number will increase by another 1.4 percent in 2013 -- from 746,828 to 757,055 (an increase of 10,227).

The number of jobs in franchises also are estimated to increase in 2013, from 8.1 million to nearly 8.3 million, a 2 percent increase.

Here's the IFA's explanation:  Because unemployment and under-employment (taking lower pay and lower-level jobs) are still a reality for many Americans, some professionals look to a form of entrepreneurship with a proven track record. 

We've covered a couple of local franchisees in ShopTalk:

Brian Sacco, 38, spent 15 years of his career working for major corporations, such as Family Dollar and Food Lion, before he and his wife, Sally, opened Charlotte's only ShelfGenie franchise. The business offers custom glide-out shelving for kitchens, bathrooms and pantries. 

Sacco said connecting with the greater ShelfGenie community was critical while he and Sally learned the manage their schedule, finances and business structure. Learn more about the Sacco's journey here. 

Martin Snell, another new franchisee to the area, opened a Hand & Stone Massage Spa, located in the Village at SouthPark, on Black Friday last year. He connected with the city's other Hand & Stone Massage Spa, located in Ballantyne, for advice, and the owners decided to split advertising costs.  Read more about Snell's journey here. 

Here are some other 2013 franchising projections from the IFA: 

• The gross domestic product (GDP) of the franchise sector is projected to increase 4.1 percent in 2013, from $454 billion to $472 billion -- about 3.4 percent of U.S. GDP in nominal dollars. 
• The output of franchise establishments (in nominal dollars) for 2013 is projected to increase 4.3 percent or $33 billion (from $769 billion to $802 billion). 

What small businesses want from Washington

Calling all small business owners and entrepreneurs: What do you want from Washington?

We know the financial situation of the new year is keeping many of you awake at night, worried about higher taxes, provisions in the health care law, the ongoing struggle of access to capital and a myriad of other issues.

So tell us what your concerns are for 2013, and what you'd like President Obama and Congress to do about it. Email yours to cmcmillan@charlotteobserver.com.

We'll be featuring them in print and online.
Here's what you'll need to include:

• Name
• Business name
• Telephone number (won't be shared)
• Letter: any length. Begin with "Dear Washington." 

We look forward to reading them. 

NFIB: Small business owner confidence still shaky

After months of fiscal-cliff melee, small business owners' confidence has yet to rebound, according to the latest data from the National Federation of Independent Business. 

Results of the NFIB's Small Business Optimism Index, released Tuesday, showed that while owner optimism in December improved 0.5 points from November's historically low report,  the 88-point reading was still the second-lowest since March 2010, the survey said. 

 December’s poor report resulted largely from a "deterioriating" job market, and the percentage of owners who still expect business conditions to worsen in the next six months, the NFIB report says.

Courtesy of NFIB

 The Index is at a recession-level reading as pessimism prevails, and December’s reading is "certainly not typical during a recovery," the NFIB says. 

The December survey is based on the responses of 648 randomly sampled small businesses that are part of the NFIB.

Other findings from the survey: 

Read more here: http://shoptalkclt.blogspot.com/2012/12/nfib-small-business-owners-confidence.html#storylink=cpy

-Seventy percent of owners said the current period was a bad time to expand, one in four citing political uncertainty as the top reason. 

-The top business problems are: taxes (23 percent), regulations (21 percent)and poor sales (19 percent).

-Job creation in December was essentially zero, improving infinitesimally from the November report. The average change in employment per firm increased to 0.03, up from -0.04 workers. Seventy-six percent of owners made no net change in employment. 

"Congress played chicken right up to the end of the year, leaving small-business owners with no new information about the economy's future," said NFIB chief economist Bill Dunkelberg, in an emailed statement. "The eleventh hour 'deal' has brought marginal certainty about tax rates and extenders and will provide some relief to owners, but it certainly doesn't guarantee a more positive forecast for the economy." 

Download the complete survey here.