Gadsden Is Following Advice On Savings

Gadsden Is Following Advice On Savings

April 27, 2002
Tallahassee Democrat
by Juana Jordan

More than one-third of U.S. households with incomes under $ 25,000 lost wealth during the 1990s. These are the families that don't own homes or stocks, but continued to increase their debt.

As a result, between 1992 and 1998, these households' median net financial assets dropped to under $ 1,000. In short, they had no savings.

Steve Brobeck, executive director of the Consumer Federation of America, one of the nation's largest consumer advocacy organizations, believes such families can be helped. And on Friday at the Silver Slipper, as part of the Economic Club of Florida's lecture series, he shared his solution.

Communities should develop savings programs, he said.

Brobeck cautioned that such an effort would be successful only if the entire community, including financial institutions, employers, churches and consumer counseling agencies, got on board.

That mobilization is already happening in Gadsden County, one of Florida's poorest counties with at least a quarter of its residents living below the poverty line.

About a year ago, the CFA awarded Gadsden between $ 10,000 and $ 20,000 -- to be used over a two-year period -- to develop such a program. It has since been named "Gadsden Saves" and is modeled after a similar program in Cleveland, in which participants had access to one-on-one coaching, free financial planning workshops and savings clubs.

In 2000, the Ford Foundation and the National Endowment for Financial Education financed the Cleveland campaign, which drew an estimated 500 participants who worked toward savings and thousands of others who participated in numerous workshops.

"These are not the traditional financial workshops," Brobeck said. "These are motivational workshops that are designed to persuade people that they can save and have wealth. If you get people to start savings, you will see a change in the community."

At least 30 Gadsden County residents have signed up to participate in the program, which is scheduled to kickoff this August, said Henry Grant of the Gadsden County Extension Service. Grant is heading up the campaign, which he said is still in need of community partners to lead workshops and serve as coaches.

North Florida Legal Services and Fringe Benefits Management Co., along with the College of Arts and Sciences at Florida A&M University, are already participating.

Said Grant: "We want to help them change to a lifestyle of selective spending and savings, rather than spending at will."