Building financial sense is aim of program

Building financial sense is aim of program

December 28, 2003
Tennessean
By RANDY McCLAIN

A new program dubbed ''Tennessee Saves'' kicks off today with a goal of encouraging Tennesseans of modest means to put more money aside to reduce a flood of personal bankruptcies plaguing the state.

The University of Tennessee Agriculture Extension Service, consumer advocates, a handful of banks and other businesses are pitching the slogan ''Earn it, keep it, save it'' as a common-sense formula that might encourage low- to moderate-income consumers to save more money and create family emergency funds.

The program is more than lip service and a catchy slogan.

''We're planning savers' clubs and workshops at area businesses to teach people the basics of saving and good financial planning,'' said Jane Gault, an education extension agent who works in Nashville for the University of Tennessee. She is helping coordinate the program here.

The university's research and extension arm has partnered with several nonprofits, six area banks and others to push ''Tennessee Saves.''

A kickoff breakfast will be held today at 8:30 a.m. at the Woodbine Family Resource Center, 222 Oriel St.

''The basic message is to encourage people to build wealth through financial education, with an emphasis on teaching them how to save and pay down debt,'' Gault said.

''Tennessee Saves'' volunteers will hold workshops for any area business that wants to offer smart money lessons to groups of employees. School programs also are planned.

The push comes as the state continues to grapple with a historically high rate of per capita bankruptcy filings.

Last year, 16,527 bankruptcy cases were filed in the Midstate, 6.8% more than a year earlier. The vast majority of those cases were personal bankruptcies.

A 2002 study by the Economic Development Council, a national group, also found that 41% of Tennesseans don't have a savings account.

Gault said ''Tennessee Saves'' has gotten cooperation from SunTrust, Citizens Bank, Pinnacle Financial Partners, US Bank, The Bank of Nashville and Prime Trust banks. Several of the institutions plan to offer savings accounts with as little as $25 to get started, she said.

Another goal is to provide money management tips to area businesses' human resources departments so they can set up educational workshops for employees on their own with ''Tennessee Saves'' printed material, Gault said.

Gault said the timing of the program couldn't be better, in part because of the publicity given to the state's new lottery, which started scratch-off sales this week. Buying lottery tickets and hoping to win big money is not smart financial planning, Gault said.

''Unfortunately, the past five years Tennessee has either been No. 1 or No. 2 in personal bankruptcies filed nationally, and I am afraid that with the lottery we may see more people trying to solve their financial problems the wrong way.''

''Tennessee Saves'' suggests a better way to save money, including these basic steps: Don't spend more than you make on a monthly basis; set up a family budget and stick to it; pay down credit card debt; pay yourself first by setting aside a set amount of cash every month until you build up a three- to six-month emergency fund.

Also, if your employer offers a 401(k) savings plan and provides a company match, take advantage of that. ''It's free money,'' Gault said.