According to the Detroit Free Press, Americans have doubled their debt over the past decade to an astounding $2.5 trillion. While this excludes mortgage-related debt, news reports also continue to paint a bleak picture of Michigan’s rising number of home foreclosures.

Many of the current money issues adults in southeast Michigan face stem from lack of financial education as youths. As part of our Agenda for Change work, the United Way’s public policy team has been advocating for a financial literacy component to be included in school curriculums across the state so that more youth learn early on how to save money, avoid debt and build assets.

The effort is already reaping results.

In October, United Way for Southeastern Michigan Public Policy Vice President Jacqueline Jones testified before the State Board of Education about the need for financial literacy classes to be added to the curriculum for middle and high school students. United Way, in partnership with Michigan Jump$tart Coalition, also rallied key political figures and institutions of higher education as well as banks and other financial institutions to advocate the importance of financial literacy to the board.

“Through our community assessment, United Way learned a great deal about the needs this region faces,” Jones says, referring to United Way's massive outreach effort that led to the development of the Agenda for Change. “Personal finance and money management skills are key contributors to an individual’s ability to avoid debt and build assets. These skills have to be taught from a young age in order for them to truly take hold.”

In response to the advocacy efforts of United Way and Michigan Jump$tart Coalition, the Board of Education recently adopted the following new language -- “Personal finance expectations should be included in high school economics and other elementary and middle school courses.” In coming months, board officials will work on honing a strategy around the curriculum changes, as well as to determine program expectations and to develop an implementation plan.

In addition to this financial literacy work, the United Way's public policy team is working with the Michigan Jump$tart Coalition and state Sen. Michael Switalski (D-Roseville) on details regarding a bill he introduced that would require a personal finance course in high school. Senate Bill 834 calls for students who successfully complete the proposed financial literacy coursework to receive math credits.

You can help in this effort by advocating for SB 834. Please contact your state representatives and urge them to support Switalski as this bill goes through the legislative process. If you are unsure of who your state legislators are, United Way offers a convenient guide online - simply click here.

United Way for Southeastern Michigan’s Leadership Next initiative is providing laptop computers to children across the region and around the world as part of an ambitious plan to make access to learning opportunities universal.

The One Laptop Per Child project was originally intended to provide a low-cost computer for poor children in developing countries. The effort led to the creation of the XO computer, dubbed the “$100 laptop.” OLPC proved to be such a good idea that it has attracted worldwide support, and interest from groups like Leadership Next and others seeking to help young people in their respective communities. The United Way leadership group is made up of young professionals who share an interest in improving conditions across the region.

"Leadership Next believes in the power of technology," says Julie Updyke, UWSEM Major Gifts Associate and Leadership Next coordinator. "We want to begin bridging the educational divides that we see in our region - and think that everyone in our community must have access to technology for this to be possible."

In November, OLPC announced a two-month “Give One, Get One” campaign. For $400, consumers in the United States could buy an XO laptop and a second XO laptop would be donated to a child in a developing country.

Leadership Next jumped into the effort, raising $4,000 in about 60 days to buy 20 laptops. Ten of the computers will be used provide local children access to early education programming, while the remaining 10 are to be donated to children somewhere in either Afghanistan, Cambodia, Haiti, Mongolia or Rwanda.

The laptop concept is the brainchild of MIT Professor Nicholas Negroponte. The idea came to him during a mission to build a school in the remote Cambodian village of Reaksmy - a four-hour drive on a dirt road from the nearest town. How could children living in relative isolation access the same learning opportunities as children in the developed world? Give each child a laptop. So, he did.

Instantly school became a lot more popular in the village. Children who had never seen a computer before suddenly were crossing the digital divide. Negroponte was knocked out.

"The first English word of every child in that village was 'Google'," Negroponte has been quoted as saying. "The village has no electricity, no telephone, no television. And the children take laptops home that are connected broadband to the Internet."

When they took the laptops home, most of the children taught the whole family how to use it. Negroponte says the families loved the information the computers allow them to tap into, and because the village had no electricity, it was the brightest light source in the house, which made them even more attractive.

Negroponte’s experience in Reaksmy planted a seed. If every child in the world had access to a computer, what potential could be unlocked? What problems could be solved? These questions led to the formation of the nonprofit One Laptop Per Child organization, and eventually the technology that produced XO laptop.

Not a laptop project, but an education project

OLPC is on a mission to revolutionize the way in which children around the world are educated. While children are by nature eager for knowledge, many countries have insufficient resources to devote to education—sometimes less than $20 per year, per child (compared to an average of $7,500 in the United States). By giving children their very own XO laptop with Internet access, OLPC is providing them a window to the outside world, access to vast amounts of information, a way to connect with each other and a springboard to a brighter future. The program is also helping these countries develop an essential resource—educated, empowered children.

With the XO laptop, children aren’t just learning about the world around them. They are actively learning about learning. Knowledge becomes a part of the journey instead of being simply the end goal. By discovering how to use their XO laptop in new ways and exploring new ideas, children are constantly engaged in a process of learning by doing. Those further along in their development who assist other children end up learning by teaching.

In all, the "Give One, Get One" promotion generated $35 million and a total of 167,000 XO laptops were sold. To learn more about OLPC, visit www.laptop.org.

Volunteer Spotlight
Fulfilling resolutions easy as A-B-C

It’s the New Year and many of us are making (and some of us are breaking) yearly resolutions. One resolution United Way hopes you keep is your commitment to giving back to the community, and we have a great new opportunity that will allow you to do just that.

Operation ABC is a region-wide collaboration aimed at getting more children to read at grade level by third grade. To do this, United Way is recruiting 1,000 volunteers to serve as reading tutors in first and second grade classrooms across Wayne, Oakland and Macomb counties. These individuals will play a critical role in helping children build their literacy skills through reading and other learning activities that augment current curriculums.

United Way spearheaded the initiative in response to the alarming number of children in our region who aren’t meeting MEAP standards in reading. In the tri-county area there are nearly 6,700 third graders who fall into this category. Studies have shown that third grade is a critical juncture in a child’s literacy development. Experts say that from kindergarten through third grade students learn how to read, and after that they read to learn. Children who are behind in third grade spend the following years continuing to learn how to read, rather than learning new material along with their classmates, and they are unlikely to catch up later in school. As a result, poor early literacy training often leads to problems later in life such as unemployment, poverty and criminal activity.

Keep your resolution to give back by becoming an Operation ABC tutor with United Way. As a volunteer tutor, you will participate in two training sessions and commit to serving one to five hours per week during the academic year at a school near your home or office. All volunteers must take a TB test, submit to background checks and receive an FBI clearance.

As an Operation ABC volunteer, you have an opportunity to make a life-long impact on the children you meet, which should make adding a few hours a week to a busy schedule seem well worth it. Sign up today, and help United Way give children in your community the educational tools needed to succeed.

Upcoming Events
Make it a King's Day on, not off

Martin Luther King Jr. sought to forge the common ground on which people from all walks of life could join together to address important human rights issues. On Jan. 21, millions of Americans will honor his legacy by taking part in the Martin Luther King Jr. Day of Service - a wide range of community service projects including food drives, beautification projects, youth mentoring, and delivering meals to homebound neighbors.

You can help honor King’s memory by participating in one of these organized service projects in your area or volunteering at other service agencies throughout metro Detroit.

Volunteer one day or throughout year

If you're looking for opportunities to serve on the Martin Luther King Jr. Day of Service, click here, and browse a list of projects that have been registered with United Way for Southeastern Michigan. Or, click here to browse a list of service projects for the holiday that have registered with the Corporation for National and Community Service.

You don't have to wait for the Martin Luther King Jr. Day of Service to volunteer. Visit www.uwsem.org/volunteer year-round to find local and individual group volunteer opportunities available.

The late Coretta Scott King embraced the Martin Luther King Jr. Day of Service as a meaningful way to celebrate and honor her husband's legacy.

"The greatest birthday gift my husband could receive is if people of all racial and ethnic backgrounds celebrated the holiday by performing individual acts of kindness through service to others," King said.

The Martin Luther King Jr. holiday was first celebrated in 1986. In the years since then the day of service was born and has gradually grown from a collection of small projects in various cities to a nationwide movement, all celebrating the life and teachings of one of America's great heroes. You can learn more about the national movement at www.mlkday.gov.

Get your organization involved

There are many opportunities for groups or organizations to make a difference during the Martin Luther King Jr. Day of Service. For example, your organization can:

• Sponsor and organize a single service project
• Sponsor and organize a variety of service projects
• Form teams to volunteer
• Encourage friends, colleagues and families to seek out service projects in their hometowns

By involving your organization in this "day on," you will help improve local communities, bridge social and cultural gaps, and honor King's memory. To learn more about how your organization can get involved, please call United Way for Southeastern Michigan's George W. Romney Volunteer Center at 313-226-9450.

Kurt's Corner
Getting 'banked' key to realizing stability

One of the major components of United Way for Southeastern Michigan’s Agenda for Change centers on providing the tools and resources area residents need to achieve financial stability. While the projects and programs that we support and develop in this area will cover a wide range of issues and populations, our primary targets will be low- to moderate-income residents.

Our emphasis will center on those falling below 200 percent of the federal poverty guidelines – about $40,000 annually for a family of four. According to estimates from UWSEM researchers, there were about 1.2 million residents – better than one in four – living below the line in 2006. Many of these individuals fall into the category of “unbanked,” which means they have no relationship with a bank and are often vulnerable to opportunistic check cashing vendors and their inflated fees, along with other costly money traps. United Way is working to help these residents establish bank accounts, and to teach them how to save and manage money wisely. We also recognize the importance of taking action now.

The U. S. General Accounting Office estimates as many as 56 million adults -- one in every five adults nationwide -- are either unbanked or underbanked. Other estimates range anywhere from 20 million to 40 million. But while figures in the various studies may differ, the fact that tens of millions of Americans (and proportional number here in southeast Michigan) are either unbanked or underbanked is clearly undisputed.

The unbanked have no deposit accounts and generally turn to check cashing establishments, retail stores and other alternative financial services to transact business. Underbanked individuals may have a basic checking or savings account but do not take advantage of advanced depository or financial services. Their financial positions are not as established as those who are fully banked, yet they are frequently engaged in making decisions about money that carry long-term consequences.

In its 2005 study, "Insights into the Unbanked and Underbanked," Synergistics Research Corporation says educated immigrants, middle-income individuals with poor credit histories and military personnel or others who lead transitory lifestyles are among the underbanked living in households with less than $40,000 a year in income. The study says the average unbanked person generally earns less than $25,000 annually, and is more likely to be someone new to the country, a young person, a single, a minority or an individual with a low-level education. Hispanics and African-Americans account for a large percentage of the unbanked and overall, the group is slightly more female than male.

According to Scarborough Research, the unbanked also are:

• Far more likely to rent than to own a home
• More likely to use prepaid cellular plans
• More likely to purchase used vehicles, and substantially more likely to choose a used car dealer based on financing options

There are many reasons people are unbanked and underbanked, including the perception that banks are too expensive or being uncomfortable with social aspects of banking. Scarborough Research also says that many consumers in this market are concerned about maintaining minimum balances, account-related fees and the privacy of their financial information. For many recent arrivals to the country, language barriers, immigration issues and an inherent lack of trust in financial institutions stemming from unstable or uninsured banks in their home countries compound the problem. Additionally, a considerable number of these immigrants were raised in cultures where cash-based transactions are preferred, so they have little or no knowledge of how financial institutions work.

However, the main reason people are unbanked, according to the Synergistics study, is that they do not believe they have enough money to need the services of a financial institution or to justify the fees typically charged for savings and checking accounts. This belief is widespread among those with lower incomes.

While most underbanked consumers may have a depository account, they shy away from loans, financial planning and similar services offered by traditional financial institutions. However, they may have loans (originated elsewhere), use credit cards or have life insurance. Unbanked consumers use credit cards as well, and they are high-volume users of check cashing outlets, prepaid value cards, money orders and wire transfers. Wiring money to relatives elsewhere can represent a large portion of the financial activity unbanked immigrants engage in each month.

The underbanked and the unbanked markets represents a sizable population of the country, and the lives of those millions of Americans would benefit greatly from a relationship with a financial institution -- for several reasons.

1) Regular banking would allow these consumers to grow their savings, as the cash-based financial dealings they currently use offer little opportunity to set money aside for a longer term. Allowing low-paid individuals the opportunity to accumulate wealth over the long term benefits the customers, financial institutions and society.

2) Using financial institutions will allow those in this market to reduce the costs of their financial transactions. Check-cashing services, money orders and wire transfers can come with high fees. The unbanked and underbanked have thus far been willing to pay those fees because they perceive them as preferable to managing their finances in a more traditional manner. Banks can provide these services and others at lower cost.

3) The cost of attracting new customers from competing financial institutions makes gaining new customers an expensive proposition. The existence of a large, as-yet-untapped market should be greeted as good news by financial institutions.

4) While this market may not be home to many large depositors, the sheer volume of consumers with a real need makes this segment worth pursuing. In addition to the goodwill that will accrue in favor of financial institutions making their services available to all markets, regardless of wealth, reaching out to the unbanked and underbanked provides an opportunity to change (for the better) the way millions of people manage their finances. Also, pursuing this potential customer base will allow financial institutions to meet requirements of the Community Reinvestment Act.

UWSEM is currently involved in several projects that address these banking issues and will be funding programs and collaboratives that we feel are designed to innovatively increase the financial stability of our residents. I would just like to mention a couple of initiatives (you can find out more by contacting the Community Investment and Partnerships staff) that are underway:

1. Regional Asset Building Coalition and the Earned Income Tax Credit (EITC) Initiative
2. Alliance for Economic Inclusion

We are also in the process of developing a relationship with Michael Barr, from the University of Michigan Law School, whose recent study, “Savings and Financial Services for Low- and Moderate-Income Households” is part of the university's ongoing Detroit Area Study.

Finally, UWSEM’s Research Department conducted a pilot study through United 2-1-1 as a way to begin to understand the extent and characteristics of the unbanked and underbanked. We are in the process of analyzing results so as to design a more comprehensive study in the future. One of the questions we asked was:

How could the financial services system better serve you?

Among the answers we received were:

• Allow payment of bills from savings accounts, rather than just from checking accounts.
• Banks could be more safe. There should be a guard near the ATM machines, especially at night.
• Be a little more lenient on people with bruised credit by looking at the circumstances
• By decreasing their fees.
• Cheaper money orders for low-income customers
• Checking fees and overdraft fees need to be less.
• They should set up some sort of coverage for overdrafting.
• Cut back on the fees for banking..for ATM etc.
• Free checking.
• Lower overdraft fee for low-income/small-account clients.
• Make you aware of retirement or savings fund that you can start for being an elder.
• More customer service
• More education on financial services for low-income clients
• Providing more information about their services.
• Stop charging for using ATM's from other banks.
• Teach about balancing a checkbook and budgeting.
• They could better help low-income individuals establish their credit.
• They should give people with low credit scores a second chance.

We hope that you will be interested in joining us in the important work we have to do. Stay tuned to our website for Agenda updates and feel free to contact me if you desire more information, want to get involved in the work, or have additional research resources and contacts you think we should know about.

Take Action Now
Bring millions of dollars back to our region by volunteering

Effecting positive change in the life of someone around you is easier than you think. In fact, over the next couple of months you can help improve the financial outlook for hundreds of metro Detroiters by donating your time or an older computer to the United Way Earned Income Tax Credit initiative.

By participating in this program, known as the EITC Initiative, you can help low-income individuals claim up to $4,700 in tax rebates and credits. Through the end of January, United Way for Southeastern Michigan is recruiting volunteers to assist metro Detroiters with tax preparation at a number of Volunteer Income Tax Assistance sites throughout the region. Each year, millions of dollars in tax credits go unclaimed in southeast Michigan and across the state. The EITC allows individuals to receive federal tax breaks based on their income and number of dependents

The Internal Revenue Service estimates that 20-25 percent of qualifying taxpayers fail to claim the EITC. According to 2004 figures, an estimated $38 million was lost in unclaimed credits in the city of Detroit alone.

Ola Jones, a Detroit resident (pictured above) claimed the EITC in 2007 and was refunded more than $3,900. She used the money to purchase clothes for her children, replace old furniture, and put money away for the future. Jones is just one of thousands of residents in Wayne, Oakland and Macomb counties helped last year by United Way EITC volunteers and seasonal tax assistants. Together they served 1,127 clients, returning $973,716 in refunds and credits to the community. Additionally, United Way support made it possible to electronically file 5,566 returns -- 67 percent of those prepared at the free VITA sites

As a volunteer you will be certified and trained in tax preparation, providing a marketable skill. Volunteers must be over the age of 18, be familiar with operating a computer, and have a desire to learn and make a difference in the lives of others.

United Way and its partners are planning to operate 30 VITA sites, and volunteers will need computers and printers at each location to process returns. Older equipment is a perfect fit for this exercise, as the minimum software requirements are very low (Pentium III, 128 mb ram, 1GB free hard drive space, Windows 2000, 6xCD ROM, Ethernet card, 56K modem, 800x600 16 bit, Internet Explorer 7). This is an ideal opportunity to find a second life for a computer that you are planning to replace or are no longer using.

At the end of the campaign, the equipment will be returned to you, or you can donate it to our Operation ABC literacy program.

“We have an opportunity to help thousands of people gain greater financial independence,” says Michael J. Brennan, president and CEO, United Way for Southeastern Michigan. “EITC lifts more families out of poverty than any other federal aid program, providing families with increased savings, reduced debt and the ability to enroll in financial training and education programs.


United Way’s EITC initiative is a great way for individuals looking to help their neighbors, and for corporations and other groups interested in a group volunteer project or donation opportunity. Please consider becoming a volunteer or supporter today. To register as a volunteer, click here.

To loan or donate computer equipment, and for more information, contact United Way's Jerry Marentette.