Busting out of the boutiques

Fashion Week descends on New York City's Bryant Park this week and next. Amid tents filled with those who have already made it, a small band of entrepreneurial designers are claiming lucrative deals. Here are five creative small-business owners who, insiders say, will soon be global brands.
By Faran Krentcil

New York City
Chris Benz
If Marc Jacobs and J. Crew collaborated, the result would look a lot like Benz's clothes. That's appropriate, because the 25-year-old worked at both places before launching his own line last year.
Though he has produced only two full collections, the critical praise for the Seattle native has been loud and unanimous, from the New York Times to Women's Wear Daily. On the horizon is an eyewear collection and a jewelry partnership with Lulu Frost. Can a Target line be far behind?
Los Angeles
Katy Rodriguez
For 11 years Rodriguez ran the famed Resurrection boutiques in New York City and Los Angeles, and selling vintage clothing inspired her to create her own line replicating the look and quality of those classics. Her dresses often feature voluminous hemlines that make them look as if a wind machine is hidden underneath. Stylist Rachel Zoe and actresses Sarah Jessica Parker and Liv Tyler count themselves acolytes. This month Rodriguez, 34, hosts her second Fashion Week runway collection, which is generating heavy buzz.
New York City
Rachel Comey
The show must always go on: Just two days after 9/11, Comey, 35, had to present her first collection to buyers. Despite the tragedy, she snagged orders from influential boutiques, partially because one of her designs had been worn by David Bowie on the David Letterman show, and shop owners were eager to see what else the new men's wear designer would create. A few seasons later the Vermont native decided her men's designs had "plateaued," and she is now focusing exclusively on women's clothing and shoes.
Los Angeles
Band of Outsiders
Scott Sternberg not only designs for his own men's wear label, Band of Outsiders, but also uses it to shelter sprouting sublabels, such as Boy, a collection of women's clothing debuting this month, and the BOO range of men's handmade wool suits.
"I have a collection that started very focused on two key items shirts and ties. Shirts were revenue-driving, and ties were a marketing item," explains Sternberg, 33, a former Holly wood agent at CAA. "The ties are what end up in magazines because you can pair them with an advertiser's suit. And those ties have afforded me the creativity to expand. I built them to afford me a lot of freedom."
Suits now provide 42% of Sternberg's revenue, and both Jason Schwartzman and Beck wear Band of Outsiders' hip and preppy classics.
Miami
Red Carter
Minutes before a Carter swimwear show in Miami, the models are sprayed with glitter and lined up on the catwalk for a final pep talk from the boss: "You are luscious. You are delicious. Those boys are gonna eat you all up. Go!"
Luxury shops such as Barneys and Intermix are also eating up designs by Daniel "Red" Carter, 35, who began his career as a water polo player and a ready-to-wear designer at Oscar de la Renta. The entrepreneur is successfully challenging huge swimwear brands such as Roxy and Speedo and recently pulled off the ultimate bikini coup: getting picked up by Victoria's Secret.

Your kids don’t need life insurance

Don’t be misled by advertisements promising a high cash value for a small premium. There are better steps you can take to secure your child’s future says Money Magazine’s Walter Updegrave.

Question: I received an offer in the mail to buy a life insurance policy for my 18-month old daughter for a small monthly premium. As I understand it, the policy would not only build cash value, but double the amount of insurance coverage when my daughter turns 21. Do you think this is a good plan to build for my daughter’s financial future or is there a better way? –R.K.
Answer: Let me put it this way. I think almost anything you would do with your money, outside of buying lottery tickets or playing the ponies, would be better than sinking it into a life insurance policy for your daughter.
As I’ve noted before, life insurance generally makes a lousy investment, in large part because of high fees that drag down returns. This view doesn’t make me anti-insurance; quite the contrary. I believe life insurance coverage plays a crucial role in any family’s financial plan.
But that role isn’t to provide an investment opportunity. Rather, the reason you buy life insurance is because it’s the one financial product that can replace income if a breadwinner dies, which allows surviving family members to maintain their standard of living.
But this principle rarely applies to children. After all, unless your daughter is an incredibly precocious entrepreneur or making big bucks doing commercials for disposable diapers, you’re not relying on earnings from her to support your family. So while your daughter’s death would obviously be a personal tragedy, it wouldn’t be a financial one.
In short, it makes little sense for you to devote your money to something that doesn’t make it as an investment and that provides life insurance protection for someone who doesn’t require it.
So what should you be doing to give your daughter a leg up financially?
Plan for your future
Well, the single most important thing you can do is to make sure your own finances are in shape. After all, the more precarious your financial situation is, the more difficult it will be for you to give your daughter all the things I’m sure you want her to have: a good education, a nice home, a chance to experience the wider world and, perhaps most important, a sense of security and stability.
You can begin building that solid financial foundation by stashing away enough money in a money-market fund or savings account to cover about three months’ worth of living expenses. This sort of reserve will allow you and your family to weather emergencies such as unexpected medical problems or financial setbacks like a layoff with minimal disruption to your lifestyle.
Beyond that, you also want to start putting away money for your retirement. If you’ve got a 401(k) or similar plan at work, contribute at least enough to collect any matching funds your employer may offer. If you don’t have such a plan, do an IRA. If you can, do both. And let’s not forget about life insurance - not for your daughter, but for you and/or your spouse. The idea is to have enough coverage so the family can carry on as normally as possible should you or your spouse die, but not so much that paying for it would prevent you from saving for the future. Deciding on the right amount is as much art as science, but you can arrive at a reasonable estimate of what you need with a “life insurance needs” calculator like this one.
Whatever amount of coverage you decide on, you’ll want to get it through bare-bones term insurance. This type of policy pays a death benefit but has no investment component. As a result, you get more insurance protection for your premium dollar. You may already receive some of this type of coverage at no charge through your employer. If that’s not the case - or if what you get isn’t enough - you can check out the cost of coverage from different insurers by going to sites such as IntelliQuote and Insure.com.
Educate your children
If you can manage all this and you still have money left over, then you can begin looking into more direct ways of providing for your daughter’s future, such as saving for her college education via a 529 savings account or other plan. And, of course, at some point when your daughter is older, it wouldn’t hurt to teach her the basics about managing money, so she’ll be better prepared to handle her finances when she goes out on her own (although, as my colleague Stephen Gandel pointed out in a Money article last year, teaching kids about finances is easier said than done.)
But as for that life insurance pitch you got in the mail, I’d say you should just ignore it. Your daughter doesn’t need the policy, and you don’t need to waste your money paying the premium.