Advancing Hope, One Loan at a Time
nonprofit a ‘life vest’ for those whose only options are high-interest loans
Published in Volume One, July 13, 2016 | Original Article
Amanda was at a low point in her life. The recently divorced mother of five was told that the home she was renting would no longer be a rental. Although a business owner before moving to Eau Claire, the needs of her children, especially one child with special needs, made it difficult to work full-time. Needing to find a new home but without the financial resources to pay for a damage deposit and first month’s rent, Amanda was not sure where to turn. Amanda’s situation looked brighter after her minister referred her to Advancing Hope Fund, which gave Amanda a no-interest loan to cover those expenses.
“Advancing Hope Fund was a life vest that kept me afloat,” said Amanda (whose last name is withheld to protect her privacy). The loan allowed Amanda to find a safe place for her family to live. Amanda credits the loan with giving her the breathing room to plan a future for herself and her kids that involved going back to school. She recently completed a degree at UW-Eau Claire and is confident she will soon find a full-time job.
According to its mission statement, Advancing Hope Fund is a “small lending community paying forward hope and financial help.”
The fund was started in 2012 as a direct response to the failed attempts to regulate the payday loan industry in Wisconsin. Payday loan companies offer small, short-term loans due within a month or on a borrower’s next payday. Lenders can charge interest rates ranging from 20 percent to in excess of 300 percent for a loan using a borrower’s car title as collateral.
Borrowers of these types of loans can quickly enter a cycle where they are unable to make payments and are saddled with debt that becomes almost impossible to pay back. Members of the economic justice task force of JONAH (Joining our Neighbors Advancing Hope), an Eau Claire-based advocacy group, saw the injustice of such lending practices and created Advancing Hope Fund to make loans to those with financial needs without charging interest. “We felt we needed to provide immediate care for people in need,” said Ken Ripp, one of the group’s founders and current board treasurer.
Advancing Hope Fund receives the funds it lends through donations from individuals, congregations, financial institutions, and loan recipients’ payments. The fund is governed by a six- to eight-member board of directors. Potential loan recipients must live in Eau Claire and are referred by community members such as pastors, social workers, educators, or board members. Once a referral has been accepted by a board member, the next step in the process is to meet with Adrian Klenz, a professional financial counselor and owner of Klenz Financial Services. Klenz looks at the financial history of the candidate, assesses the candidate’s ability to successfully repay a loan, and offers general financial education such as budgeting. He then provides a summary of his findings to the Advancing Hope Fund board. Board members review the summary, meet with the recipient, formally approve the loan, and craft a mutually agreeable repayment plan.
The recipient agrees to meet regularly with a “walking partner,” which is a unique aspect of the Advancing Hope Fund loan process. A walking partner is a financial mentor who meets regularly with the loan recipient. The regular meetings are designed to help ensure repayment of the loan, to create a working budget, to track repayments, to communicate any changes that might affect the repayment plan, and to encourage the recipient to set goals. Amanda describes the walking partner as a “supportive, understanding advocate.” During the repayment process, a walking partner may also suggest revisiting the financial counselor when needed for more education/advice about how to handle finance or changes in income.
Advancing Hope Fund also has an expectation of loan recipients “paying it forward” by being positive forces in the community when they can. For Amanda, that has translated into becoming a board membersfor Advancing Hope Fund and speaking to organizations about the loan program. “AHF values my skills and does not view my financial crisis as an indication of negative personal character,” she said.
For more information about Advancing Hope Fund Inc., contact Ken Ripp at firstname.lastname@example.org or (715) 456-5703.
Seems to Me: Financial education critical
Published in Leader Telegram, April 10, 2016 | Original Article
Financial education is a passion for me. It comes from personal experience. From the age of 18 until my late 20s, I dug myself quite a financial hole. It took over six years to climb out of that mess.
Looking back, my school didn’t talk about personal finance. My parents didn’t talk about personal finance. I had to navigate the tricky and sometimes predatory world without knowledge. The results weren’t pretty.
Many people face this same fate. The March 27 Voice of the People entitled “financial education key” by William McCullough lamented how our area offers little financial education for our young people.
There are two issues. First is a lack of funding. The second issue is a cultural fear of talking about money. Like religion, sex and politics, we are taught to never discuss money. If you have a problem, hide it.
I found myself doing this. I hid maxed-out credit cards and poor financial choices from my family and in some regards myself. It finally caught up with me. As a nation it caught up with us in 2008 when we were hit by the Great Recession. Did we learn from it? In many cases it doesn’t seem like it. With the looming student loan crisis many American’s face, that may be the next bubble to burst. I fear it will make the housing crisis look like child’s play.
It stands to reason that if we collectively refuse to discuss money, then the leaders who (in theory) come from the general population will also refuse to discuss it and thereby neglect to provide the attention and funding needed to provide financial education.
In 2009 I was hired by Western Dairyland to create a financial literacy program. I soon realized there wasn’t much offered here in the Chippewa Valley, so I built a program from the ground up. This led to UW-Eau Claire hiring me part time in 2011 to help them create a financial literacy program called FLIP (Financial Literacy Improvement Program). The goal was to ultimately make the position full time.
I trained students from the accounting and finance program to be financial mentors. Then I paired them with community members in need of financial mentoring. I worked part time at UW-EC developing this program and part time at Western Dairyland offering individual financial counseling to 100 people a year. I offered 30 to 40 workshops a year reaching hundreds of community members. All of this was free.
Budget cuts to the UW System eliminated my $20,000 a year position at UW-Eau Claire.
Back at Western Dairyland full time, we wrote countless grants seeking funding. In five years we had provided free financial education to 50 local organizations and businesses. We pulled them all together asking for help finding funding to keep this program afloat. We needed about $50,000 a year. We got two donations from local banks for $2,000. Sadly, the program could not continue.
I reached out to the school district at least four times offering my services for free. I wrote political leaders at the local, state and federal levels telling them the importance of this issue. Most of the time I got a form email or form letter signed by an aide telling me how important the issue was but that was about it.
We have already seen what a lack of financial education can cause. I encourage everyone to reach out to our educational leaders and political leaders and ask them to place importance on financial education. There is little cost to these programs and the return on investment is significant.
The consequences of a lack of action isn’tsome hypothetical thing. It is lives limited by financial hardship. The ramifications on all areas of our society are enormous.
Like it or not, money does make the world go round. Financial education is the map to navigate the journey. Let’s help people stop getting lost.
Excerpt from Volume One Magazine: Full Article
Adrian Klenz of Klenz Financial Counseling in Eau Claire carried a different set of letters after his name: AFC, or Accredited Financial Counselor. While “financial counseling” and “financial planning” may seem like synonyms, they’re quite different. While a financial planner typically helps clients with investments, retirement planning, and estate matters, a financial counselor tends to work with people facing financial crisis – for example, those who are dealing with debt collectors and may be pondering bankruptcy. While these are often people on the lower end of the economic ladder, that’s not exclusively the case: Klenz said he’s worked with millionaires who are in over their heads.
In many ways, Klenz’s role is an educational one. “Somewhere in the neighborhood of two-thirds of Americans don’t budget,” while about one-third of Americans have debts in collections, he said. Likewise, many people aren’t knowledgeable about how credit works, such as the fact that most negative pieces of information only stay on your credit report for seven years.
Klenz’s counseling focuses on clients’ financial behaviors, and he offers budget counseling, credit counseling, and debt negotiation. “I try to get them to a point where they’re able to start investing or to start planning for retirement,” he said of clients. Once they reach this point, he said, they’re often ready to take the next step and seek advice from another kind of financial professional.
ACCREDITED FINANCIAL COUNSELOR
PAST FINANCIAL WOES AID MAN IN
HELPING OTHERS BY SHARING STORY
From Leader Telegram: FULL ARTICLE
Adrian Klenz remembers getting phone calls from creditors. He remembers making poor financial decisions. He remembers being broke.
"In my 20s I maxed out my credit cards. I destroyed my credit rating," he said.
These days, those financial difficulties work in Klenz’s favor. He works as a financial literacy specialist with Western Dairyland Community Action Agency, helping people try to avoid making the same mistakes he did.
While much of our society readily discusses physical health, financial health often is on the back burner, Klenz said.
"When it comes to sitting down to talk about money, we don’t do that," he said.
Convincing people with limited financial means to discuss their spending habits can prove difficult, Klenz said. So when he meets with people, he instead focuses on helping them understand why they made the spending choices they do. Oftentimes, people’s estimates of their spending and reality are far apart, he said. Klenz was no different, he said.
"The first time I did it, I was $500 a month off. I had $500 per month where I had no idea where the money was going," he said.
These days Klenz said he compulsively tracks his spending, even for minor purchases. Tracking expenditures helps prioritize them, he said.
Klenz started at Western Dairyland as an AmeriCorps volunteer in 2009, when times were particularly tough because of the recession. If there was a silver lining associated with the recession, it was that it prompted people to try to save more money, he said.
However, credit card debt remains a real problem, Klenz said, noting that figure averages about $15,000 for the average U.S. family.
Nationally credit card debt is $850 billion, but that has now been surpassed by student loan debt, which is about $1 trillion, he said. While he can often negotiate debt reduction for his clients, student loan debt can’t be reduced.
Marcia Schiszik, coordinator of the Eau Claire County AIM court, a treatment court for single mothers, said Klenz put on a workshop for treatment court case coordinators in which he offered helpful ideas for making it easier to talk with clients.
"He did training for all the treatment court case managers where we learned not to be judgemental about it," she said.
LEARNING ABOUT YOUR MONEY
Interview Volume One Magazine: FULL ARTICLE
Adrian Klenz wants change. As a financial literacy specialist at Western Dairyland Community Action Agency, his vision is a world where everyone is financially literate, they’re taught the basics of personal finance alongside math, literature, science, and other essentials. We sat down with him to talk education, the local economy, and what changes need to made now.
What exactly do you do? It’s not exactly debt consolidation — that’s a different thing — but more restructuring and negotiating?
I do financial counseling. A big part of what I do is budgeting and helping people get access to their credit reports and understand them. Once people are in a position to do so, I do debt negotiation. So that’s where I work with the client – either with them or on their behalf – and contact folks that are coming after them for money and basically help them navigate that process, and negotiate a settlement for less than what they owe.
Last time we talked we talked about how Eau Claire has a lot of young college-aged people and – especially through the University – you had mentioned there’s no hard-and-fast resource for young people to learn the basics, you know, creating a budget, living within their means, being responsible with credit, stuff like that. Is that specific to the University?
I taught at the university for about 18 months. And I was in the College of Business. I specifically was working within the accounting and finance department. And there was my position and the goal was “Alright, we’re gonna create a class where ultimately all accounting and finance students will go through this and they will get a semester of experience where they’re working with community members, helping with personal finances and by doing that, they’ll also learn about their own personal finance.” I went around to these different programs and I was talking to them like “Hey we have this great program here and it’d be great if we could work together.” What I saw was all of these programs were competing for dollars. And they wanted to have their own program, instead of having this overall unified vision of “You know what’s best for our students? Let’s create a centralized office of financial literacy – or whatever you want to call it – and we’ll work with different programs, all the students and try to teach about this important topic.” And everyone was very competitive and worried about their own program. I’m not on campus anymore, so maybe that’s changed. Maybe they’re working towards that. I even went to the dean of students, I talked to anyone that would listen and said “We need some kind of centralized office” – I met with counseling services and they said like 75% of their students when they’d do their intake surveys listed finances as a major worry in their lives. I don’t care if it comes out of counseling services. I don’t care if it comes out of the dean of students. I don’t care who does it, but there should be one office and their job should be to teach about financial literacy. So one of the things that I’ve done while I was on campus and now since I’ve left, professors have asked me to come speak to their class about budgeting, about credit. Usually two or three times a semester I get phone calls or emails saying “Can you some speak to our group?” And that’s a start, but really it should be across the board. I think it should be every year because as you get older, you have different needs. It’s something I’m passionate about. I really think that it’s politics; it’s everyone jockeying for their own dollars. It’s very territorial. And I think that while I was there, that’s what I saw.
It’s not something that anyone disagrees would be a good thing for the university to have. It’s just there’s a lot of red tape involved in getting something going.
There’s a lot of red tape. I mean, you’re right. Everyone agrees on it. Everyone sees it’s an important need. But I think everyone’s worried about their departments and their own dollars. And the same thing can be said for the nonprofit world I think, too. Competing for limited dollars, everyone’s trying to fight for it. And it goes to a higher level of looking at our government.
A big thing is financial literacy, getting people to be financially literate. I’m wondering how you define that.
That’s a good question. I know that there’s different curricula and standards, you know, quizzes and tests that they have to determine whether or not Americans are financially literate and we’re abysmal with it. We’re not good. As far as a blanket definition, I don’t think you can do that. I think it has to be a case-by-case situation. You have to look at each individual and see where they’re at within their own lives. There’s some broad themes: Understanding how to do a budget, understanding how to gain access to your credit reports, how to understand them, those are some very basic things that hopefully everyone can get better at, but everyone’s different.
Is this a problem you think will persist for a bit, or do you see it shifting?
I think it’ll persist for a bit. I don’t see any change on the horizon. I don’t know what it’s going to take to change it. It doesn’t matter what your political label is. Gov. Walker has an office of financial literacy, Gov. Doyle did. President Obama has it, President Bush had it. Both sides talk about it, but it really would come down to there being a commitment from the parties to say, “You know, we need to contribute X number of dollars to financial literacy programs” and it’s just not there. And so I don’t know what it would take. A Bill Gates or somebody, a billionaire… Bloomberg or somebody willing to pump money into that. It’s a shame. Like I look at Western Dairyland – we’ve been doing this for five years – the first year I was funded through Americorps. The four years since, it’s literally been pieced together every year ... the threat of lay-offs at least once a year if not more, and they always find a way to keep me, but we’ve met with community members, we’ve met with banks, credit unions, different partners saying “Please, will you help fund us,” and no one is able to do it, unfortunately, and it’s really been a tough battle.
On that note, what is the financial landscape like locally, in the community in general and how can it improve?
It can improve on all levels. First of all, there needs to be a formal curriculum in our schools. So few require that in order to graduate high school you have to have a personal finance curriculum. We don’t. Eau Claire doesn’t have anything. And it needs to start at a young age, where you start to talk to kids about money. Parents, I know they struggle – I meet with a lot of parents that it’s an internal battle for them. They don’t know like, “How much should I talk to my kids about this?” Sometimes they’re worried about scaring their kids. Sometimes they’re ashamed of their own finances so they’re afraid to share that with their kids. So that’s something that parents need to work on. But like I said, if it started in the schools, that would help. We talked about the college thing already. As you go through life your needs change. And it might be something where the kids are talking to them about allowance. Talking to them about how to save. And once you get to college and you start getting your first credit card, you start getting student loans, making sure you’re understand the commitments there. It’s becoming a huge issue.
I’m talking about a social revolution: not with tanks and overthrowing the government, I’m not saying that, but we need to somehow get people to the point where they’re not so ashamed of talking about money. It’s kind of like religion. It’s kind of like sex. People just don’t want to talk about money. We’re taught at a young age that you don’t talk to people about money. Well, the result is so many people you see at all income levels, all age groups let problems go until it’s too late. We somehow have to get people to the point where they’re able to talk to somebody about money, so that if you come to somebody like me or somebody at Catholic Charities or somebody at Family Means and say, “Look, I need help. I’m falling behind on my credit card bills” or “I’m behind on my mortgage.” Because unfortunately, they wait until it’s too late oftentimes. That’s a conversation that we need to have. It’d be great to start it locally. So people know there are resources out there and that it’s a confidential thing – you’re going to be protected. You can come and talk to someone and they’re not gonna go out on the street and blare to the whole world that so-and-so is late on their credit card bill. In my personal experience, the weight that’s lifted once you face those financial difficulties, you can’t even measure it. It’s night and day.
I remember all too well that feeling of being afraid to answer my phone, or open my mail. Just constantly in the back of mind worrying about it. Until you don’t have to worry about it. It’s just an amazing feeling. So we need to have that conversation about it. As cheesy as that sounds, if we started it in Eau Claire, or the Chippewa Valley, that’s a start. And if every community started doing that, starting at a young age in schools and in colleges, parents start having a conversation about it, I think it would make a significant difference.