In chapter 5 of Stone Fox, little Willy goes to the bank looking for a way to come up with the $500 that the tax collector, Clifford Snyder, says Grandfather owes the state of Wyoming. Mr. Foster, the president of the bank, refuses to give Willy a loan. ". . .How could you pay it back?" Mr. Foster asks little Willy.
Pretend that it is May 1, and summer vacation is just around the corner. This year, instead of just relaxing by the pool, watching baseball, and reading, you and a friend want to start a business and earn some money. You need $50 to buy capital (tools and equipment) and some supplies to get your business started.
Complete this activity as a "business plan" that you will use to apply for a $50 loan. If you can't convince someone (parent, relative, bank loan officer) that you have a good idea AND that you will be able to pay the loan back, then you will not be able to borrow any money.
My business is (circle one):
Yard and Garden Work (raking leaves, pulling weeds, etc.)
Entertaining Toddlers and Preschoolers
Cleaning Garages, Basements, or Attics
Pet Care (walking, grooming, feeding, etc.)
List the resources you will need to start your business. Then circle the things on your list that are "capital" - tools and equipment that you can use over and over.
Now look back at your list. Do you have all items? If you don't, you must buy them. Make sure that $50 will be enough, otherwise you must take something off your list or borrow more money (ask for a bigger loan).
When you borrow money, the "loan" must be repaid. How and when do you plan to pay the money back?
Once you have a list of needed capital that you can purchase for $50 or less and a plan to repay the money, you're ready to apply for your loan. Good luck!!