Visionary Wants Financial Security For All

By Andrew S. Ross
San Francisco Chronicle.

If Carrie Schwab-Pomerantz had her way, there would be a U.S. Department of Financial Security. Headed by a Cabinet-level appointee, the job would help Americans take better care of themselves in matters involving money. In making the appointment, she would want the president to say “financial literacy is a national cause.”

It is a cause Schwab-Pomerantz has single-mindedly pursued for 30 years. Her passion has been to show how “financial education can change lives” and help address the needs of the tens of millions of Americans with no back account, credit or savings, the millions more scraping by paycheck to paycheck, seniors lacking a nest egg to see them through their golden years. “Parents, unbanked, kids, the working poor, the 50-plus, from rich to poor — it cuts across all lines,” she said.

And it’s a monumental undertaking. According to a 2011 FDIC study, close to 70 million Americans are regarded as financially underserved.

Last year, they generated more than $100 billion in fee and interest revenue, according to a Center for Financial Services Innovation analysis of various alternatives, like payday loans, auto subprime loans and very short-term credit.

Especially troubling, as the U.S. population ages, is how little Americans are saving for retirement. According to a Wells Fargo study last year, 41 percent of middle-class Americans in their 50s “are not currently saving for retirement.” Close to half say “they will not have enough money to ‘survive’ in retirement.”

“What will that mean for our country?” Schwab-Pomerantz wonders. “No one’s talking about it.”

Schwab-Pomerantz, 54, is president of Charles Schwab Foundation, a nonprofit organization that develops and funds programs for the financially underserved, and supports employee philanthropy and volunteerism at the investment company founded by her father, Charles Schwab. “She is devoted to making investing more accessible to the American public, encouraging men and women from all walks of life to take charge of their financial lives,” said Zhan Li, dean of St. Mary’s College’s School of Economics and Business Administration, who nominated her for the first Chronicle and St. Mary’s Visionary of the Year award.

That includes looking at those who would otherwise be approaching what could be not-so-golden years. A UC Berkeley graduate with an MBA from George Washington University, Schwab-Pomerantz, in partnership with the AARP Foundation — a philanthropic affiliate of AARP — created a Finances 50+ program, a financial how-to for low-income workers and job seekers age 50 and older — “the unsexy group,” in her words.

It’s working. An evaluation of the program last year “showed positive and statistically significant changes in financial behavior and attitudes,” said AARP CEO JoAnn Jenkins. Schwab-Pomerantz’s commitment to the program “is a shining example of how she’s focused on improving the financial well-being of older adults who may not otherwise have an opportunity to receive this type of information and guidance,” said Jenkins.

Program for women
Starting out as a self-described “secretary’s secretary” when she was just 16 at Schwab’s San Francisco headquarters, Schwab-Pomerantz later became a financial consultant at one of the firm’s Atlanta branches in the mid-1980s. Invited to a dinner with executives from the Atlanta Women’s Foundation, which invests in programs for women and girls, she was asked if she would join and help raise money. “I hadn’t been that philanthropic, and asking for money really scared me,” she recalls.

But she turned out to be a deft hand at fundraising, and found her calling. “Because I cared so much about the topic, I found it much easier to ask.” She organized a Schwab-sponsored financial education program designed for women, and took charge of the entire Charles Schwab Foundation in 2002. “It was an evolution for me,” she said. “What opened my eyes was that changes could be made. It taught me how you could combine business needs with social needs and have a real impact on both.”

Money Matters, Make It Count, a financial literacy program she developed for Boys & Girls Clubs of America, is an example. Over the past 10 years, more than 500,000 teens have learned how to manage a checking account, create a budget, save and invest, start small businesses and pay for college.

“We’ve seen the program work,” said Jim Clark, CEO of the national organization that provides after-school programs in all 50 states, Puerto Rico, the Virgin Islands and U.S. military bases. “Many of our club youth have gone on to careers in the financial industry, others on to college — once the program showed them the many different options presented through financial aid and scholarships — and some kids even make budgets to help their families stay on track.”

“Carrie is an amazing partner. She cares deeply about the future of America’s kids,” Clark said.

Push for federal programs
The mother of three and married to journalist-author Gary Pomerantz, the Marin County resident’s energy seems boundless. On numerous nonprofit boards, including Boys & Girls Clubs of America and the International Women’s Forum, she also taps out a weekly Ask Carrie financial advice column, which appears on the Huffington Post, and in newspapers nationwide. Her book,”The Charles Schwab Guide to Finances After Fifty,” came out last year.

She’s also served on two blue-ribbon commissions on financial literacy, under Presidents George W. Bush and Obama, the latter formed in 2010 in the wake of the Great Recession. The financial crash was “a missed opportunity to rally (Americans) around the need to own their own financial future,” she said. “That was a disappointment to me.”

One of her recommendations contained in the Obama commission’s report is to get local and federal governments, public-private partnerships and private employers more involved in financial literacy programs. Thanks to some gentle nudging by Schwab-Pomerantz, the federal government’s Office of Personnel Management has launched a “retirement financial literacy and education” program for government employees.

“I want the government to use its bully pulpit to raise the issue and set guidelines,” she said.

As to who might head the Department of Financial Security, should it ever come to pass. … well, moving from the Bay Area to Washington, D.C., would be a tough sell, she admits. But spearheading a national campaign to make it happen — that she could envision.

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