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MagnifyMoney Returns to Chattanooga to Host Financial Empowerment Sessions

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

MagnifyMoney Returns to Chattanooga to Host Financial Empowerment Sessions

This week, the MagnifyMoney team returned to Chattanooga, Tennessee. Our original visit in June was inspired by the documentary Paycheck-to-Paycheck, which featured the Chambliss Center for Children. During the documentary, we saw a desperate need for financial education, so we packed up our bags and headed to the Chambliss Center to host financial seminars and one-on-one meetings.

The staff and parents of children at the Chambliss Center were warm, welcoming and shared unbelievable stories with us. So many men and women felt broken by the complex banking system and many had turned to predatory lenders in their hours of need.

During our one-on-one meetings, we provided specific guidance to help people feel empowered and save their money by finding the best financial products for their lives.

We were able to help one woman, we’ll call her Anna, cut her credit card debt by thousands of dollars after we walked her through the process of setting up balance transfers.

Upon our return to the Chambliss Center, we were able to check in on some familiar faces and make some new friends. We were particularly excited to catch up with Anna and see how the balance transfers worked out. Anna walked into the room with a confidence we didn’t see during our last visit. She smiled, joked and shared her enthusiasm that her debt, which just months ago had tipped over $12,000 was now down under $6,000. By utilizing balance transfers, Anna could put all of her monthly payment towards chipping away at the principal instead of just throwing money at interest charged by the bank.

In addition to our time at the Chambliss Center, we were also given the opportunity to provide one-on-one meetings at First Things First, a non-profit dedicated to strengthening families in Hamilton County, Tennessee

First Things First provides a variety of resources for families, but some are focused specifically on fathers who may no longer be with the mother of their children. The organization helps these men learn how to be present in their child’s life, handle child support, find employment and learn the life skills necessary to be a good parent.

We were able to sit down with some of the men and listen to their financial struggles.

Questions ranged from where to bank without being charged fees to how to get a loan from someone other than a payday lender to how do you save money?

We were impressed with so many of the resourceful ways these men, and the women we met, found ways to save money and create strategies for themselves as the underserved and unbanked.

Over the next couple of weeks, we’ll be sharing stories and lessons we learned from our time down in Chattanooga.

We want to thank the staff of the Chambliss Center and First Things First for welcoming us into their communities and a heartfelt appreciation for all the men and women who took time out of their days to come speak with us.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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Modest Needs: Legitimate Help for Those in Need

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Legitimate Help for Those in Need

Getting a grant to help pay your bills from perfect strangers sounds too good to be true. Could having someone else handle your unexpected medical bill or car repair costs really be as easy as submitting an application that explains why, even though you’re employed and making money, you don’t have the cash to pay for your bill yourself? Could a charitable donation made online to a stranger really be put to its intended use and skimmed off the top by a bloated company?

With Modest Needs, it seems receiving help or donating to those in need is just that simple. The organization makes grants to people who genuinely need a helping hand during hard financial times. It ensures money from donors goes toward empowering those in need.

What Is Modest Needs?

Modest Needs, also known as modestneeds.org, is a nonprofit organization founded in 2002. The charity aims to provide financial assistance to low-income individuals and families, with the goal of preventing these people from slipping into poverty.

Everything began as the personal project of Nashville, Tennessee resident Keith Taylor. Taylor made his charitable work very personal; he saved part of his own salary each month to give away to those in need. After launching the site to connect with people who needed help – and people who wanted to financially contribute to others – the project snowballed.

Today, Modest Needs assists “low-income workers who are struggling to shoulder the burden of a short-term emergency expense.” The main type of assistance they provide is called a Self-Sufficiency Grant. These funds are given as grants, not loans, meaning the money does not need to be repaid by recipients.

Self-Sufficiency Grants are intended to help people who work and earn an income, but live just above the poverty level and are therefore unable to take advantage of any social assistance programs. These people may be just one paycheck away from financial disaster, and that’s where a grant can help.

Grants are generally made to people who are facing a financial emergency that they cannot afford, or who cannot afford to pay a monthly bill because of a legitimate extenuating circumstance.

How Grants Are Made

Modest Needs requires an application if you hope to receive one of their grants. Applicants must provide proof of income (to ensure they actually need financial assistance) and need to explain the crisis they’re facing that prompted them to ask for help. The organization advises setting aside a half hour to 45 minutes to complete the full application.

Some of the group’s other requirements include having at least one employed adult in the household. In addition, the main source of income for household must come from earnings via employment, child support payments, Veteran’s Benefits, or retirement income. The size of the grant depends on the applicant’s income.

Finally, applications that receive funding are required to write a thank you note to Modest Needs. Donors may opt in to receiving a copy of that note from applicants, as well.

By law, Modest Needs cannot grant funds for expenses including taxes, past-due child support, or fines and fees associated with civil or criminal offenses. As a matter of policy, the group will not provide grants for things like credit card debt or “luxury” goods or services.

If you’re interested in applying for a grant with Modest Needs, then you can find out more information here.

One Catch

Once an application goes live on the site, donors are then given the ability to vote on which grants should be funded. Donors get a vote by making a contribution to Modest Needs. A donor gets a vote (referred to as a point) for each dollar contributed. If you decided to donate $50, then you could put all 50 points towards one cause or spread them around. The points are reflected with a progress bar the following statement: “$ [total voted] has already been given to Modest Needs by donors who’ve recommended this application for funding.” 

However, there is actually one catch. A request needs to be fully funded in order for the recipient to get the money. Modest Needs does not provide partial payment on grants.

For example, Sally needs $1,200 to get her roof repaired but donors only received $800 by the due date, she would not receive the $800.

Information for Donors

Modest Needs is a registered 501(c)(3) (tax exempt) organization (Federal ID #47-0863430). Contribution you make, if you’re a U.S. donor, is tax deductible.

Note that when you do make a donation, you’re not directly and immediately funding the application you entered a dollar amount for. Your donation goes to Modest Needs itself, along with a recommendation of which application you want to see funded. The organization has the final say-so in what applicants receive grants.

Modest Needs requires an application be “fully funded” before executing any grants. If the application you recommended for funding does not reach 100%, your donation is returned to your account and you have the option to recommend (vote for) another applicant with the money you contributed.

Find more information out here.

Legitimate Help for Those in Need

Donors should be able to rest assured that they’re giving to legitimate causes when they fund an applicant on the platform, and donations are tax-deductible. There are no minimum contributions.

When it comes to the applicants on the website, Modest Needs screens individuals to make sure requests are real and legitimate. They also have staff that perform the necessary due diligence and research into each application. Grants are never made in cash; instead, payments are remitted directly to a vendor or creditor on behalf of the applicant.

Modest Needs is a registered nonprofit with the IRS and with the state of New York. Watchdog site Charity Navigator gives the organization a 3 out of 4 star rating and garnered high praise in reviews on GuideStar. The nonprofit also meets the standards set by Give.org.

You can view financial reports from 2005 to 2012, and you can request hardcopies of this information through the website as well. Finding information from frequently asked questions to mailing and email addresses is easy, and it seems the group strives for transparency.

Giving More than a Handout

With the proliferation of personal pleas for assistance on crowdfunding sites like GoFundMe, Modest Needs stands out as a refreshing alternative. Anyone can go on crowdfunding platforms and ask for handouts, with the onus of responsible giving placed on the general public. People asking for funding are under no obligation to use the cash in a particular way; there are no requirements for funded projects after they’ve received money.

Modest Needs, on the other hand, was started and designed as a charity and giving responsibly is ingrained in its stated missions. The organization specifically focuses on helping those who are working and just above poverty level – meaning they’re often making enough to disqualify them from government assistance programs, but making too little to handle a financial emergency.

Some current applications for grants include a Wisconsin woman who lives independently and maintains a job as a housekeeping and laundry attendant, and needs to repair her car* so she can continue commuting to work. Another is from an elderly vet who needs new tires on his car to drive safely through the Colorado winter, while a teacher in Texas needs help to pay an unexpected medical bill.

The requests range in size from large to small – one woman works two jobs to pay all her expenses, but cannot afford to repair her broken washing machine – but all are similar in the fact that they come from working individuals who can cover their regular monthly expenses, but live paycheck to paycheck and struggle to come up with funds for unexpected or emergency costs. You can browse other requests here.

Modest Needs uses donations to fund these types of grants so lower-income, employed individuals can continue on with their lives and avoid having one random, unexpected expense push them into a cycle of poverty that they cannot break.

*Kali Hawlk decided to personally donate to this cause after writing this review.

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4 Financial Pain Points for College Students

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Financial Pain Points for College Students

This week, I had the opportunity to visit New York Institute of Technology’s Long Island campus to do a presentation about personal finance basics and student loans. After talking with some students both before and during the session, I figured out that their pain points boiled down to four main categories.

1. Building and Protecting a Credit Score

Credit scores are frequently a section of our presentations that we have to stop and field a lot of questions. There are so many myths out there that cause a lot of confusion, plus a general fear about how to properly use credit cards. I emphasized the fact you don’t need to take out a loan to build your credit score and diligent using a credit card is a free way to get a 700+. Just remember: pay on time and in full!

[6 simple steps for building your credit]

2. Digging Out of Consumer Debt Already Incurred

It’s not uncommon for college students to fall victim to the credit card debt trap. Some students had already started to utilize balance transfers to move debt over to 0% APR. This is a great strategy – but only if you can properly use the balance transfers. I overviewed some of the traps banks are hoping to lure you into with a balance transfer.

[Learn more about balance transfers]

3. Understanding Income-Driven Repayment Programs

Most of the students had federal student loan debt, but hadn’t heard about income-driven repayment programs. These programs, such as IBR, REPAYE, PAYE and ICR can help make payments affordable – especially in the early years after graduation when salaries are likely to be low. The income-driven repayment programs restrict payments to a percentage of discretionary income and then discharge any remaining debt after 20 to 25 years.

[How to set up income driven repayment plans]

4. How to Refinance Student Loans

Not all students can pay for tuition by just using federal loans, which leaves them turning to the private sector. Not only are private student loans likely to come with higher interest rates, but they definitely come with fewer protections and perks. Federal loans offer grace periods, forgiveness, income-driven repayment plans, forbearance and deferment. Private loans lock you in and aren’t always so lenient. However, refinancing does provide the opportunity to reduce interest rates on private and/or federal loans. Students just need to be wary about giving up the protections of federal loans.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.