by Christian Lopez, Program Associate 

I am the first person in my family to graduate from high school. My mom supported and encouraged me to pursue college but lacked the knowledge and resources to guide me. It was thanks to the help of Cabrillo College staff and faculty I was able to enroll, receive partial assistance to pay for my tuition, and eventually help guide and support me. Today, I’m getting ready to graduate from Cabrillo and transfer to CSUMB to complete my bachelor’s degree in Business Administration.

​Why Business Administration? Coming from a single parent household, I know the financial difficulties that can impact a family. I spent my teenage summers working in agriculture. The people I worked with came from similar backgrounds, struggles, and culture as me. Many people lack financial education, and this contributes to a family’s financial instability. My goal is to coach families in how to budget, use credit wisely and save for the future.

I first learned of SCCV as a participant of CreditBound, a program focused on building credit and building financial knowledge for young adults. Being part of Community Ventures as a Program Associate gives me the access to reach out to the community and make a potential change in their day to day life. I am excited for the journey ahead and look forward to growing as a person and learning more. 

​ABOUT Christian: Christian will be attending CSU Monterey Bay in Fall of 2019 to obtain his bachelor’s degree in Business Administration.

By Brando Sencion, Program Coordinator
 
April is Financial Capability Month and it is a time to encourage families to improve their financial futures. Financial capability is the knowledge, skills, and access to manage financial resources effectively.
 
Achieving financial well-being is a journey and it takes time, practice, and patience. The best way to begin that journey is by making minor changes to our financial habits. To determine those behavioral changes, we must examine our personal financial behaviors and habits. For example, we can start by making saving a priority, paying bills on time to avoid late fees, create financial goals, pay down debt, and build an emergency fund. These small steps can make a big difference in a person’s financial well-being and give them the confidence and motivation to continue down the right path.
 
Key steps to improve our financial futures, examine your:

• Existing financial habits
• Relationship with money
• Current financial situation
• Financial goals

 
However, taking these steps can be incredibly hard for many families. According to a survey by CareerBuilder, 78% of U.S. workers are living paycheck to paycheck. These financial difficulties make it harder for money to be set aside for savings, paying down debts, or making bill payments.
 
Families living paycheck to paycheck is the result of many external economic factors that affect our everyday lives. But creating a strategy to improve our financial situations is crucial to improve our finances. Remember financial capability is about improving your knowledge, skills, and resources to mange your financial resources effectively. Those financial resources vary from family to family, but we must use or financial capability to improve to the best of our abilities.
 
Building families’ financial capability is about giving them confidence of knowing where to look, what to look for, what is required to prevent economic vulnerability, and where to go for answers to questions. Below find resources to help you increase your financial capability. 
 
Resources

• Family Financial Plan: https://www.sccvonline.org/family-plan-workplan.html
• Plan for Life Events: https://www.mymoney.gov/lifeevents/Pages/lifeevents.aspx
• Spending, Saving and Investing: https://www.usa.gov/spend-save-invest
• Make a Budget: https://www.consumer.ftc.gov/articles/pdf-1020-make-budget-worksheet.pdf
• Managing Your Money: https://www.consumer.gov/section/managing-your-money
• Credit Report Example: https://www.experian.com/credit_report_basics/pdf/samplecreditreport.pdf

By Brando Sencion 
 
​The Consumer Financial Protection Bureau (CFPB) recently decided to remove rules that protected vulnerable borrows from accruing ballooning debt that can be created by payday loans. The last set rules released in 2017 aimed to protect consumers from unfair lending practices of the payday lending industry. The original rule required that lenders determine whether a borrower could actually afford to pay back a loan before offering them one. The news rules aim to remove these protections and allow payday lenders to operate freely. 

Payday lenders typically offer small loans to borrowers who promise to pay the loan back by their next paycheck. However, interest on one of these loans can have an annual percentage rate of up to 390 percent or more. In California, the maximum fee a payday lender can charge is 15 percent of the face amount of the check. But that 15 percent fee is equivalent to an annual percentage rate of 460 percent! 

The other issue with payday loans is that they are structured to force people to take out additional loans when they cannot pay their previous loan. Research by CFPB estimates that 80 percent of loans are rolled over, and half of borrowers end up taking out ten or more loans in a year. Consumers fall into a cycle of debt that is difficult to escape because of the payday lending structure.  

However, some states are fighting back payday loan businesses and protecting their consumers. Voters in Colorado last November approved Proposition 111, Limits on Payday Loan Charges Initiative. The proposition reduces the annual interest rate on a payday loan to yearly rate of 36 percent and eliminates all other finance charges and fees associated with payday lending. 77 percent of voters supported the initiative, to end an average APR of 129 percent on payday loans in Colorado.  

As rules and policies for the payday lending industry change, it is important to educate ourselves as consumers. But as community leaders it is important to inform our communities of these changes to prevent families from falling into a cycle of debt. Mamás con Más a project with the UC Santa Cruz Blum Center and SCCV examined mothers’ experiences with financial providers, and mapped the location of alternative and traditional financial services, showing the disproportionate concentration of alternative financial services such as payday loans, check cashing, money transfer services and more, in Watsonville, CA compared to Santa Cruz, CA. ​ 

Building from Mamás con Más, the project recommended to limit alternative lenders such as payday loans in Watsonville and Santa Cruz County, due to high interest rates and fees, which push families deeper into debt. And develop policies that ban or restrict the number of alternative financial services and limit the allowable interest charged. Restricting the number of predatory lending businesses in the City of Watsonville would benefit the community. And not allowing new payday lending businesses to open until a current business closes would be beneficial.   

Congratulations to Brando Sencion, SCCV’s Program Coordinator, for his appointment to the Parks and Recreation Commission in Watsonville!

“I lived across the street from Callaghan Park. I didn’t have a back yard or a front yard, but I had a whole park to play in,” said Brando, “I spent most of my time there playing basketball, football, or skateboarding. The park provided me with a safe space to play and enjoy my childhood.”

The commission is set to take on a lot of exciting work this year, such as the master plans for the City Plaza and Ramsay Park. And update the 2009 City of Watsonville Parks and Recreation Facilities Master Plan.  
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SCCV is looking forward to hearing about all the great work Brando will be doing! We are proud to have him as a team member and we know he will make great contributions.

SCCV is proud to donate laptops to support Project Scout's free tax preparation services. The laptops will give volunteers the opportunity to help more community members utilizing their services. 

As we enter the month of February, it is time to gather your tax documents, and all other necessary information to file 2018's taxes. Project SCOUT will be offering free tax returns for families making $54,000 or less. 

If you plan to use VITA this tax season, here are some important documents to bring to the site:

• Proof of identification (photo ID)
• Social Security cards (or ITINs) for you, your spouse and dependents
• Wage and earning statements (Form W-2, W-2G, 1099-R,1099-Misc) from all employers

To find out more on what to bring to your local VITA site, visit the IRS/VITA website. 

By 2027 half of the workforce will not have an employer. You read right, half of the workforce would be part of the "gig" economy.

Imagine what this does to our social fabric and the giant shift this places on our expectation of employers. From health care to retirement funds. Not to mention worker protections. When you add this to the growing wealth gap and increased accumulation of wealth to the top 1%, it does not bode well for our communities and the demand this will place on our safety net programs. 

I heard this statistic at the 2018 Worker Cooperative National Conference in Los Angeles, CA. And yet, just as daunting as that was it was followed up with a conversation about the possibility of what this could mean - a radical shift that places democratic business ownership as the force to stabilize work and organize labor. 

The idea is that we can explore and scale different ownership models that share business profits across workers to address accelerating wage gaps and provide a greater distribution of wealth. This more equitable distribution of wealth will then help support stronger communities by such things as expanding the tax base and minimizing the need for safety need programs such as rental and food assistance.

The challenge then is how can this model get to scale? Consider the number of small to medium size businesses and the fact that many are owned by baby boomers. Baby boomers who will be retiring in the next 10 to 15 years. We can capitalize on the exit of single proprietorship and enable those businesses to be sold to their current employees. Thereby keeping local successful businesses and jobs while moving employees to greater wealth by becoming owners. This might not be for everyone, but considering the volume of businesses and jobs that will be at the table, it may just be enough to create a shift needed.

It is the vision of the possible that made many technology platforms a force in creating a gig economy, and it may just take that same energy and imagination to structure new business models that make the future of work one that contributes to our communities well-being instead of creating more problems.

As Community Ventures embarks on a journey to help build a community investment fund, one that supports our locally owned and democratically run businesses, I was inspired by others who share those same goals and offered their help to make this happen in Santa Cruz - a community filled with hope, love, and the daring vision of a much better world. I invite you join me and others who are making a $10, $25, $50, or even $100 monthly donation to support our work in making this vision of our future a reality. 
​
In solidarity, 

Maria T. Cadenas
Executive Director

Happy Mother’s Day from the Community Ventures team! We want to take a moment and recognize the hard-working mothers in the community. You are an inspiration to us all and we admire your strength and devotion.
 
We are inviting you to join Community Ventures and UC Santa Cruz’s Blum Center on Wednesday, May 30th at UCSC! The team will discuss Mamás con Más, local Latina moms’ experiences with financial services, including traditional and alternative lenders.
 
Let May 30th be an additional day of appreciation for mothers and learn how you can support and give back to the women that matter most.
 

Save the date! More information to come.  ​

By Brando Sencion, Program Coordinator of Community Ventures 

​For many entrepreneurs trying to start their own business credit is essential. Lacking credit can be a major setback for entrepreneurs willing to start businesses. The lack of credit means no access to loans, business wholesale accounts, leasing equipment or space, and more. So where should you start? Here are 3 ways to establish and improve credit.
 
OBTAIN CREDIT REPORT
Before you start to build your credit, it is important to obtain a copy of your credit report. Your credit report has information on where you live, how you pay your bills, and more. The report helps creditors, employers, and other businesses evaluate if you are a good candidate. Make sure the information is accurate, complete, and up-to-date. If you find any inaccuracy or incomplete information, be sure to correct it. Corrections of errors can help improve your credit history. 

APPLY FOR A SECURE CREDIT CARD
We all have to start somewhere, and a secured credit card is a great option. A secured card is backed by a cash deposit you make when opening the account. The deposit will determine the credit limit on the card. You’ll use the card as any credit card. There will be interest and payment dates. However, the only difference is you opened it with a deposit to secure the account. After a few months, the financial institution will remove the safety net and offer you a credit card with no deposit required. Now that you have learned to use a credit card and have built history with a financial institution, you can continue to build your credit with other lenders.
 
PAY AT LEAST THE MINIMUM, PAY ON TIME
If you already have credit history, but it is not enough to qualify you for the lines of credit you need. Focus on building your credit with good habits. Building credit is a slow process and can take up to 6 months or a year to get within a desirable credit range. A good habit is to pay at least the minimum due on your bills and paying them on time. Payments make 35% of your credit score and heavily weigh on your credit history. Furthermore, keep credit utilization low, the balance and your credit limit should be at a healthy ratio. If existing debt is a problem, work to pay down the debts of credit accounts with the highest interest or lowest balance. Additionally, always pay more than the minimum amount, this will pay debts down faster and reduce interest build up over longer periods.
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