The Savings Collaborative
37% of Americans don’t have $400 in savings. One organization is working to change that.
A Gary Community VENTURES GranteE
By Will C. Holden
Editor: Brian Firooz
CREATIVE DIRECTOR: MICHELLE TAKARA FAIRBAIRN
37% of Americans don’t have $400 in the bank. And in the BIPOC and immigrant communities that the Savings Collaborative serves, that number rises to 60%.
Let that sink in. Now let this next part do the same.
Within eight to nine months, regardless of income, the team at the Savings Collaborative has proven they can get their Savers to that $400 mark. Within an additional six-plus months, the average Savers have elevated their reserves to at least $1,300.
If you’ve spent a lifetime building your savings, that might seem like a drop in the bucket. But for that aforementioned 60%, it’s a minor miracle.
It’s pride about having money in the bank – having never had any savings before. Knowing there is some money to pay for snow tires or a doctor’s visit. Being able to pay rent despite a health-related injury or temporary job loss.
And miracles, as Tony Lemus well knows, have the power to incur skepticism — especially among the Savings Collaborative’s prospective customers.
“Many times, we’re told, “You guys are too good to be true.’” said Tony, who serves as the Head of Strategic Partnerships for the Savings Collaborative. “So many communities in our country have been repressed, oppressed, isolated, excluded. And oftentimes, these are the same communities that have been subjected to fraud and deceit.
“They have fallen into all of it because of the need and dire circumstances they face. So when they start this process with us, they’re very wary — and rightfully so.”
So how does The Savings Collaborative team start rebuilding that broken trust in our financial system? With cold hard facts about their radically different financial product.
- Technology, including one easy-to-use, multilingual app that provides real-time feedback, financial tools and incentives to increase savings
- Financial incentives, including compounding interest savings accounts that pay out twice a year and low-cost microloans for emergencies
- Community, including culturally responsive Community Ambassadors to ensure the new savings habits stick
- Education, including professional financial coaches who provide in-depth, personalized guidance to help Savers reduce debt, improve credit and access equitable banking products
Next, a promise: You’re not going to get rich quick.
As it turns out, that’s exactly the point. Little by little — or poco a poco — via community, education and technology, we can build savings. That’s the Savings Collaborative motto.
And little by little, it turns out, this movement they’ve built is changing systems and changing behaviors — and changing lives in the process.
Alma Guzman, Savings Collaborative client and Cultural Ambassador
Photography & Design: Michelle Takara Fairbairn, Venue: The Home of Alma Guzman
Alma Guzman had $6,000 in a box underneath her bed. She worked hard to save it, but she didn’t really know what to do with it.
Two things she did know?
One, she didn’t want to put it in a bank, because she had already been told she didn’t qualify for an account that would earn interest. Two, she knew she didn’t want to keep it under her bed, because every time she needed a little extra cash, it was too easy to take from the box.
Shortly after she met Barbara Freeman in 2019, Alma’s plan for that money became clear. It’s not hard to understand why, especially given Barbara’s background in financial advising.
Dr. Barbara, as it turns out, is a long-term consultant to the World Bank and the NGO World Vision. She started her career on Wall Street as a currency options dealer for UBS and was part of a team that founded the first global derivatives portfolio for Midland Bank Plc, which is now part of HSBC.
Barbara has lived and worked on five continents and created multiple educational and socioeconomic interventions for communities across lines of difference. She’s a National Association of Certified Credit Counselors (NACCC) Certified Financial Counselor. She co-founded KPMG Consulting’s Risk Management practice in Asia, which grew into a 400-person practice. She’s been a visiting scholar at U.C. Berkeley and a visiting professor at the University of Sao Paulo.
That’s not how Barbara introduces herself, though.
In fact, Barbara and Alma met like so many of us do — through a mutual friend. And their relationship began with an offer from Alma to teach Barbara how to speak Spanish. As Barbara was writing Alma her first check for those services, she explained the Savings Collaborative concept she had just launched.
Alma didn’t hesitate.
“Can I deposit my money with you?” Alma remembers asking. The rest is history.
“I started bringing my money directly to Barbara,” Alma said. “And once I put it in the Savings Collaborative, I never take it out — unless I have a goal.”
Shortly after she began saving, the goals began coming into focus. Alma had lived in Colorado’s picturesque Roaring Fork Valley for 24 years since moving with her uncle from Mexico. And she had long wanted to buy a piece of it for herself — a home that her family could call their own.
Two years after she made that initial $6,000 deposit with the Savings Collaborative, Alma did just that. Thanks to her savings and compounding interest, she pulled $25,000 out of her account to use as a down payment, and she purchased a home on two acres of land in New Castle.
A few weeks later, Alma’s 9-year-old daughter Amy pulled an ornately decorated box out from underneath her new bed. It was full to the brim with $17 dollars in change.
“She said, ‘Mama, I want to save too.’” Alma said.
Two years and $30 a month later, Amy is now proud to report she has more than $2,000 worth of savings. All along the way, Alma’s cousins, extended family and friends built up over more than two decades in the Valley have come to know and trust the Savings Collaborative, as well.
Alma has since become one of the program’s Community Ambassadors, and her impact, at least in the eyes of the program’s founder, has been as seminal as anyone’s as this startup has taken root.
“It’s just been so beautiful to watch,” Barbara said. “Not only has Alma been able to build this life of freedom and economic choice and opportunity, she has recognized this opportunity for her community to do the same. These are the kinds of partnerships and relationships that make this model work.”
Barbara Freeman, left, Founder and CEO of the Savings Collaborative, speaks with Ingrid Zúniga, right, the organization’s first Cultural Ambassador.
Photography & Design: Michelle Takara Fairbairn, Venue: The Home of Alma Guzman
Organic Growth & Expansion
As touching as Alma’s story is, Ingrid Zúniga says it’s just one of many Savings Collaborative stories that will melt your heart — more than 1,800, to be exact.
Savers have now made 6 home purchases, a commercial business property purchase, and at least 4 land purchases. But it goes much deeper than that for Ingrid.
She’s heard stories from Savers who can now afford expensive medication for their aging parents. Stories from Savers who can now afford unexpected payments when the family’s only car breaks down. Stories from Savers who were able to take their first-ever family vacation.
As the Senior Ambassador, Ingrid has helped the Savings Collaborative team grow its base in the Roaring Fork Valley. Within three years, the nonprofit already has 1,800 Savers on savings plans in the area. With the Hispanic and Latino population at about 6,000 in the area, the Savings Collaborative very quickly captured an impressive number of new Savers in their initial geography.
If you begin to examine the people leading the Community Ambassador program, it’s not hard to understand part of the reason for this organic growth. Much like Alma, Ingrid’s roots on the Western Slope of Colorado run deep, and so she said her efforts to build trust in the Savings Collaborative’s services have grown naturally out of her existing relationships.
“As Ambassadors, we have this unique opportunity to make this Savings Collaborative movement about something greater than just getting Savers access to banking services,” Ingrid said. “We get to be part of people’s lives. It’s not just about how much money they have in the bank, because we’re different from a bank. We are able to build safe, trusting relationships, where Savers can talk about their struggles and work to change behaviors in ways that allow them to fulfill goals and chase dreams.”
Whether she’s speaking to someone she’s known in the Roaring Fork Valley for years or a new client on the Front Range who she might be meeting for the first time, Ingrid says she approaches the relationship-building process with Savers the same way — by staying consistent and leading with lived experience.
“My biggest goal is to keep the conversation going,” Ingrid said. “So often, we hear, ‘I can’t save that kind of money right now,’ and the response is always. ‘That’s OK. We’ll be back in touch soon.’ We never judge people for where they’re at in life, because so many of us as Ambassadors have been there too.”
For Ingrid, she was there not long ago.
Ingrid moved to Colorado from El Salvador when she was 18 years old. She soon realized that she would need to learn English and get more education to set herself up on a pathway to a choice-filled life in the U.S. Through the Savings Collaborative, she discovered the mechanism she needed to build savings to pursue these dreams.
Like those she would come to help, Ingrid found the Savings Collaborative app easy to use and appreciated the just-in-time support, especially at the start of her wealth-building journey when she most needed the guidance – and a little nudge in the right direction.
In the app, Savers are able to set financial goals, establish recurring deposits, create children’s accounts, and receive positive feedback on their progress in real-time. The Savings Collaborative then offers personalized professional financial coaching and in-person access to practical financial workshops on reducing debt, building savings, buying a home, improving credit scores, and building a thriving wage to help the automated lessons stick.
The track record of success within the Hispanic and Latino communities has been inspiring, Tony said. The prospect of introducing it to new and different communities and larger populations really motivates him, especially given his purview as the co-chair of the Immigrant and Refugee Commission for the City and County of Denver
“We have a high percentage of people in the Latino community who are gaining greater control of their finances and their futures,” Tony said. “As we expand in the Denver Metro area, where the Ethiopian and Vietnamese communities are very strong, for example, can benefit just as much, even if they aren’t as visible.”
Left: Alma and her daughter Amy | Right: Alma speaks with Ingrid using the Savings Collaborative app
Photography & Design: Michelle Takara Fairbairn, Venue: The Home of Alma Guzman
A Game-Changing Product & Integration
Mariette Candelon is a member of Denver’s Vietnamese community, and in her role as an accredited financial counselor, she has come to understand that for many of her clients, distrust in banking systems runs deep.
“There are so many people — more than you might realize — who don’t trust banks,” Candelon said. “Some have lost trust on account of the country they came from; they’ve lost money when they put it in a bank. Some have firsthand experience with banks and financial institutions that didn’t offer safe or affordable products and services. And some just have never gotten the sort of financial education they need to feel comfortable in this realm.”
Mariette currently serves as a financial coach with the Denver Office of Financial Empowerment & Protection (OFEP). The Denver OFEP got its start in 2013 in the aftermath of the last recession. According to a study by CoPIRG, during another period of financial turmoil in 2020, Denver OFEP clients showed notable resilience. In the midst of the pandemic that year, CoPIRG reported, Denver OFEP helped city residents reduce $1.4 million in debt, boost savings by $227,000, avoid $826,000 in tax preparation fees and improve their credit scores by an average of 43 points.
The office achieves these aims, Mariette said, by combining financial coaching, consumer financial protection, and assistance navigating government and nonprofit resources, along with other services.
Thanks to a recent partnership with the Savings Collaborative, Mariette is now offering it as a banking tool to her clients, and it’s among the most powerful, in her estimation.
Case in point? Mariette recently began working with a young woman in her mid-20s who had taken out a payday loan in the midst of the pandemic when she needed to take time off work to care for her mother, who had fallen ill.
The loan was for $685. The interest rate was 665%.
Working in tandem with the Savings Collaborative, Mariette was able to help her client renegotiate and restructure the terms of the loan. Ultimately, the Savings Collaborative assumed control of the loan, and lowered the interest rate to 6%.
“It was life-changing for my client,” Mariette said. “And for me as a coach, the experience was life-changing too, because normally payday loans are not the type of debts where you can enroll in a debt management program. So outside of the loan and terms we were able to get through the Savings Collaborative, I’m not sure my client would’ve had any other options.”
Once she started exploring the Savings Collaborative app, Mariette was even more impressed with its habit-building savings tools. Things like built-in nudges and rewards for increasing monthly savings, motivational and personalized messages to guide specific financial actions, and perhaps most of all — the entire app is multilingual.
“For so many people, finance is a foreign language,” Mariette said. “So imagine if I was trying to present this foreign language to you — in a foreign language. That’s what our current system is doing. In an effortless way through their app, the Savings Collaborative lifts those barriers.”
A Clear Pathway to Scale & Impact
Kat Traylor is the Savings Collaborative’s new Director of Education & Outreach She comes into this work with deep reservoirs of knowledge — some she’s more proud of than others.
She’s not shy about admitting that she began her career underwriting subprime loans in the automotive industry, which she says gave her a deep knowledge of the very products the Savings Collaborative is now working to circumvent.
After rising through the ranks in the automotive industry, Kat was able to launch her own political strategy firm, Kat Strategies. She then went on to serve as Director of Constituent Services for U.S. Congressman Jason Crow in Aurora, where she has become a fierce advocate for the reform of our financial systems.
“One of the largest challenges facing our Black and brown communities in Aurora and Denver is the ability to gain access to vital information while creating safe and affordable banking products,” Kat said. “During our outreach work in recent years, we’ve discovered many people are aware of predatory products. But without healthy alternatives, many are still forced to use those products.”
Savings Collaborative with its easy savings mechanism and learning-by-doing approach – which bridges the gap between intention (wanting to improve the financial situation) and taking action to make it happen – provides this healthy option. With a proven product and expanding customer base in tow, Kat sees the Savings Collaborative on a clear path to changing the status quo.
So do many others. As of Oct. 2023, the organization had secured two years of launch funding for its expansion into Metro Denver through a growing network of co-funding and implementation partners. That network includes our team at Gary Community Ventures alongside Alpine Bank, Colorado Health Foundation, the Colorado Trust, Delta Dental Foundation, the Denver Foundation, Kenneth King Foundation, the NextFifty Initiative and First Bank.
The Savings Collaborative team has learned that the best way to build trust is through relationships and partnerships. On the Front Range, this means working hand-in-hand with those organizations that already have the trust of the community. As of Oct. 2023, Savings Collaborative has opened discussions and started working with a variety of statewide service providers, including a major energy company, a major medical center, several housing developers, government human services departments, and other nonprofits interested in helping their customers avoid payment defaults and achieve financial resilience and economic security.
Learning-by-doing is the key to behavioral change at an individual level. To make long-term sustainable differences in the lives of its customers at a systemic level, Savings Collaborative believes it is vital to integrate its savings and coaching mechanism directly into complementary business services, government programs, and legislation. Thereby embedding the benefits as part of the service and amplifying the outcomes of both programs to create enduring impact.
There’s plenty of more work to do. But the potential for impact that the Savings Collaborative can have becomes clearer to Kat by the day.
“It’s great that we’re helping folks gain access to better, more trusted financial tools and resources — and that we’re able to show the kind of resiliency this can build in communities,” Kat said. “The next step is getting our institutions to start codifying these practices. We need these tools and resources embedded in our government programs, being championed by trusted businesses. That’s how we truly start forming habits that stick.”
The Cultural Ambassadors
Meet the team that’s building a community around savings, changing habits, changing systems and changing lives in the process.
Savings Collaborative is partnering with organizations seeking better outcomes for those left outside mainstream banking systems
Contact the Savings Collaborative
Want to learn more about the Savings Collaborative’s revolutionary model or get in touch with their team? You can do so here.
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