In Financial Diaries, Rachel Schneider digs under the surface and really gets into the nitty-gritty of American's financial lives including their hopes, dreams and struggles. Her poignant stories, including one about a family whose Sunday night meetings help them figure out what bills they can pay that week, will give you a deeper appreciation of what financial insecurity feels like. Financial Diaries laid bare the fact that a high percentage of Americans have challenges predicting their monthly income given the wide variances they experience month to month. This has real implications for how we teach budgeting to our students. Now at the Aspen Institute of Financial Security, Rachel continues to make a difference by developing ideas for financial products to serve vulnerable populations. Enjoy!

Details:

• 0:00–1:10 Introduction
• 1:11–2:23 Rachel Schneider, author and entrepreneur-in-residence at Aspen Institute 
• 2:24–4:41 The inspiration behind Financial Diaries
• 4:42–14:08 A look behind the numbers & understanding the American experience
• 14:09–20:19 “It’s all about Sunday night…”
• 20:20–25:46 Do financial products actually work for everyone?
• 25:47–29:56 Cliff Notes version of the Financial Diaries
• 29:57–30:29 A word from NGPF
• 30:30–32:28 Comparing their findings against national surveys
• 32:29–40:11 How teachers can implement Financial Diaries in their class
• 40:12–50:01 The gaps in financial education
• 50:02–55:19 An inkling of what she’s working on now
• 55:20–56:27 Conclusion

Book:

• Financial Diaries: How American Families Cope in a World of Uncertainty

Current roles

• Omidyar Network Entrepreneur-in-Residence at the Aspen Institute of Financial Security
• She previously worked at The Center for Financial Services Innovation [CFSI]
  • Marla Blow, a previous NGPF podcast guest, developed the idea for her company at CFSI

Other resources mentioned

• Limited mental bandwidth and how it can explain the psychology behind poverty [Article)
• The Federal Reserve: Survey on Household Economics and Decision-making
• J.P. Morgan Chase Institute
• The Urban Institute: Social and Economic Policy Research
• NGPF Interactive Spent: Living Paycheck to Paycheck
• Carl Richard’s napkin drawings

Easy rules of thumb

• “Don’t swipe the small stuff.”
• “You should never spend more than ⅓ of your money on rent.”

Book Recommendation:

• The Index Card: Why Personal Finance Doesn’t Have to Be Complicated
  • Author Helaine Olen on NGPF Podcast

QUOTES:

• “This woman explained how she and her husband both worked hourly jobs and every Sunday they would get their schedules for the upcoming week… they would sit down with a calculator... [and] figured out how much they were going to earn and figured out which of their bills they could pay.”
• “If you’re budgeting down to the minute, checking accounts aren’t really designed for that… It really is the case that financial products don’t quite help people to do what they need them to do, which is often save in short bursts, know exactly how much money they have on hand today, taking into account the biggest bills they have upcoming in the next few weeks… What people really need is help forecasting.”
• “People are constantly every day making decisions about their financial life, and I think a lot of our financial education should try and narrow in on those choices so people can see how those choices connect to the longer term trajectory.”
• “A theme that we picked up on in Finacial Diaries is that… Americans tend to feel responsible for their own futures—and that’s a wonderful thing… But the flip side of that is when people think their financial lives are a mess they think it’s their fault, and it’s not.”

About the Authors

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.

Danielle Bautista

Danielle is a native of Southern California and a recent graduate from the University of Maine, where she braved the frigid winters—a feat in and of itself—and earned her Bachelor's degree in International Affairs. She has a passion for working with non-profit organizations and serving populations in underprivileged communities. When Danielle isn't writing NGPF blog posts, spearheading various outreach projects, or managing contests and flash surveys, you can find her doing some sort of outdoor activity, learning a new hobby, or cracking what she thinks are witty puns!