Survey after survey shows Americans have a weak grasp of basic financial knowledge, and that women, people of color, and people without college degrees are likely to be less financially literate than their peers.
Giovanni Monterroso is working to both raise the bar and level the playing field.
Monterroso is a financial educator at $3.7 billion asset Tinker Federal Credit Union in Oklahoma. He teaches workshops on how to improve financial literacy, including Spanish-language programs he designed for Hispanic audiences and sessions for teenage mothers finishing high school.
As the credit union’s only Spanish-speaking educator, Monterroso is in high demand. In 2016, he conducted 300 workshops for 5,562 attendees. For these audiences, his workshops tend to focus on credit and car buying.
“Many in the Hispanic population are first-generation immigrants who have little knowledge of the credit system in the United States,” he says.
Too often, unscrupulous lenders take advantage of this lack of knowledge. “Explaining the credit system and how it works helps these individuals make better decisions, but most of all, it helps them save a lot of money,” he says.
At Emerson Little Wonders, a child-care service in Oklahoma City that serves single mothers attending Emerson High School, Monterroso’s workshops emphasize money management, goal setting, and positive financial futures.
“These students come from low-income families where finances are a constant struggle,” Monterroso explains. “The goal of the workshops is to provide them with a format to structure their dreams and desires, prioritizing mom’s and baby’s needs before their wants.”
When it comes to general financial education, one of Monterroso’s favorite tips is to imagine personal finances as faucets. Just as a leaky faucet wastes water, leaky finances waste money.
To stop the leaks, he recommends cutting down on impulse buys and avoiding late bill payments and high interest rates.
For example, Monterroso prefers gas stations with a pay-at-the-pump option to avoid the temptation of grabbing a muffin and coffee inside. Those purchases seem small but become big leaks over years of repetition.
Monterroso also emphasizes paying off debt as quickly as possible to reduce the total amount paid over time. “For me, a minimum payment is the legal way for a financial institution to get as much money as it can from me,” he says.