FOR RELEASE: Sept. 24, 1998
Contact: Susan S. Lang Office: (607) 255-3613 E-Mail: [email protected] Compuserve: Bill Steele, 72650,565 http://www.news.cornell.edu
ITHACA, N.Y. -- A mere $10 investment to enroll in a Cornell Cooperative Extension financial education program reaped an average $5,000 gain in net worth for participants one year later, according to a Cornell University survey.
After just six months in the program, called MONEY 2000, more than half the participants were paying bills on time, reducing their credit use, saving money, using a budget and trimming their debts.
"Our survey of 175 participants gives us enormous confidence that MONEY 2000 is a unique, positive education program that empowers people to reach their financial goals," says Barbara J. Bristow, program director and an extension associate in the department of policy analysis and management in the College of Human Ecology at Cornell. "Participants are learning to save for the future painlessly but effectively."
MONEY 2000 is a three-year-old statewide initiative through Cornell Cooperative Extension county offices that provides financial education, money management skills and financial counseling. To date more than 1,000 New Yorkers have participated in the program.
For a $10 fee, participants receive record-keeping materials, a yearly financial calendar and a subscription to the quarterly newsletter, MONEY 2000 News. They attend money-management workshops and information sessions, set financial goals with the help of extension educators, and learn ways to pay off consumer debt and freeing up money for savings.
"Consumers also learn budget planning and balancing, common credit pitfalls and how to correct them, where to find $10 a week to put aside and how to invest it, how to shave 10 percent off household expenses without sacrificing quality of life and how to buy a desired product without having to use costly credit services that can more than double the product's cost," Bristow explains. Participants also learn the value of paying off or reducing consumer debt to safe levels, the importance of establishing an emergency fund and steps to making and living with a spending plan.
"Considering that some 70 percent of Americans live paycheck-to-paycheck and that consumer borrowing has jumped 52 percent while savings have shrunk by 23 percent in the past 25 years, many American consumers are in financial disarray," says Bristow, adding that both high- and low-income consumers are overspending, undersaving and overextending. For example:
-- One in seven American workers doesn't save for retirement.
-- In 1996, Americans saved less than 4 percent of their disposable income. That's less than half what consumers saved in Britain, Germany, Belgium, France and Japan.
-- The average baby boomer spends half of his/her salary paying off debt.
-- Individual savings rates fell 23 percent between 1970 and 1994.
-- Nearly 8 percent of all credit card debt -- almost $30 billion -- does not get paid off; that's the highest "charge off" rate ever in this country.
Cornell Cooperative Extension also offers supplemental educational programs, such as classes, seminars, work-site education programs, family budget counseling, debt analysis, a home study course and fact sheets, all designed to help consumers make wise financial decisions.
Enrollment in MONEY 2000, which is supported in part with funding from Salomon Smith Barney, a member of the Traveler's Group, is through any participating Cornell Cooperative Extension office, online or by mail. In counties without an active MONEY 2000 program, consumers can enroll by sending a letter of request with the $10 enrollment fee to MONEY 2000, 133 MVR Hall, Cornell University, Ithaca, NY 14853.
A MONEY 2000 web site with more than 200 pages of information about increasing savings, cutting household expenses, reducing consumer debt and investing wisely, is available at http://www.money2000.org.
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