Non-Profits Connect Financial Education with Community Application and College Access

March 11, 2013:

Financial Literacy and Access to College was the topic of a panel moderated by Jenny Flores, Senior Vice President, Citi Community Development Manager, Northern California and Central Valley at the Financial Literacy and College Persistence conference held at Menlo College on January 18. The panelists from local non-profits included Leigh Phillips, Office of Financial Empowerment, City and County of San Francisco, Nicole Ramos, from BUILD and Saundra Davis, Sage Financial Solutions.

The discussion focused on making a connection between financial education research and how communities are using that research to design and innovate impactful programs. The panelists highlighted how exposure to financial education and financial capability is changing the college aspirations of students, particularly for those from low-income households.

Leigh Phillips: “The Office of Financial Empowerment focuses on Access to healthy financial products and services: The Bank On program started in San Francisco with partners like Citi and spread like wildfire across the country. Access to financial education, counseling and increasing financial knowledge: We’re engaged in that with our San Francisco Smart Money Network. Combating predatory practices and engaging in consumer protection: Our municipal government uses tools such as zoning ordinances to limit the growth of prolific payday lending and check cashing. We’re also focused on increasing assets and savings for our communities: Kindergarten to College. enables students start school with a financial asset to help them save for college.”

Nicole Ramos works for the non-profit, BUILD, a 4-year entrepreneur program for high school students. Their mission is to use entrepreneurship to propel and engage disadvantaged and disengaged students through high school to college success. After ninth grade students spend a year developing full-fledged business plans, they join Build’s Youth Business Incubator where they pitch their idea to a venture capital advisor, earn seed funding, and take out a loan. Their products are marketed and earn real money. Through this experience students are empowered to pursue higher education.

Saundra Davis is a financial planner and coach. “Unless people can control their financial choices, then nothing is going to change. We focus on people who are struggling with behavior as it relates to financial choices. We study what’s going on and come up with ways that we can help change the behavior.”

Jenny Flores: “How did the research out in the field help to shape the way that you developed and shaped the Kindergarten to College program?”

Leigh Phillips: “We followed the work of national and local groups, such as EARN, Aspen Institute and others who were looking at the power of matched savings and children’s savings. We had the political will of former mayor Gavin Newsom and treasurer José Cisneros to get something done. Research showed that the program needed to be automatic, universal, publically funded, offer matched funds, have a variety of deposit options, and link to financial education.”

Jenny Flores: “BUILD’s product is unique because it uses entrepreneurship as a vehicle to teach young people personal finance and get them excited about college. How are those components structured for outcomes and change in the aspirations of students?”

Nicole Ramos: “Entrepreneurship is a powerful hook. Students get excited about making money. We use key milestones such as making college application lists, doing the FAFSA, researching scholarships, and choosing colleges to teach financial literacy and influence their decisions.”

BUILD serves students who are ethnically underrepresented in higher education, low income, and first generation in their family to attend college.  They also give priority to students already showing signs of disengagement; students who before high school believe that paying into the system of education won’t pay off for them in the end.

BUILD’s 4-year eligible students are making the choice to start at community college. “Statistics show that students are thinking of sustainability to ensure that they will be able to stay in college for four years,” said Ramos. “93% finished their first year of college compared to the national average of 73%. This is especially astounding because we don’t work with the nation’s average students.”

Jenny Flores: “How can we generate as much value as possible from your interaction with clients?”

Saundra Davis: “I’m a fan of the pull rather than the push technique of education. If you have well-trained facilitators, and they are confident with money themselves, they are key to successful client interaction.” When asked if there is progressive programming to find a way out for African American high school students when the research shows that they have high rates for not graduating and loan default, Davis referred to research that shows African American females don’t know it’s a function of behavior. “Programs to help them should focus on experiential learning that helps them see a pathway from where they are to where they want to go,” concluded Davis.