Saving for College? This Org May Match Your College Fund

HESTER: This episode is part of an EdTech Times series called challenges and solutions for student financial aid and debt.

HESTER: This is Hester Tinti-Kane with EdTech Times. And today we’re speaking with Bob Hildreth, the founder of Inversant, about student financial aid and debt. Bob, could you start by introducing yourself and your organization?

BOB: Sure. I’m Bob Hildreth, as you said. I founded Inversant, first called Fuel Education, seven years ago, and it has a sister organization, called La Vida. In terms of my personal history–I for most of my adult life, have been a business man specifically in finance in Latin America in an emerging market debt. And as I said about seven years ago, when I reached 60, I moved over to the foundation space to what has always been my first interest, which is education.

HESTER: Wonderful. So can you describe the population that your organization serves?

BOB: Yes. It’s a low income population. And we assure that by going into low-income towns. We are not after income data from our families, but we know that if you live in Chelsea, Revere, Salem, Lynn, Boston–in the areas that we go into, you’re going to be low income.

HESTER: So how many cities total are you in?

BOB: Six going to 10.

HESTER: Great. And all in the state of Massachusetts?

BOB: Correct.

HESTER: Great. So tell me a little bit more about your organization and the research that you do. I know you do a lot of research. And what does that research tell you about those largest barriers to entry for the prospective college students in this low-income population?

BOB: We started from the assumption, and it was an assumption—we didn’t have the data on it, that the American school system, and educational system, was missing a lot by not putting parents front and center. And we tried to find a way to bring parents into the educational discussion and into education life. So we came up with the idea that if we could match what people save for college, we could get them excited about saving for college. It’s a one-to-one match. It starts with the idea if you save $25 a month and we match you with $25 a month. You can start to build your savings over years. And we have found that 1,300 families have saved a million dollars in our program, and we’ve matched it with a million dollars. So that’s 2 million dollars for college.

BOB: And so, we have then gone and said, “Well, what do we really know about these parents, and about their kids?” So we are always collecting data.

BOB: The statistical data is, how many times do our parents go to our monthly educational classes? How much do they save a month? How many times do they save a year? Are they able to make the total goal of between $1000, $1500 that would get them up to $3000. What is the connection between their saving and their students interest and ability to go to college?

BOB: So we then go further than that statistical data. And we go on to look at surveys, gather groups together where we ask them questions, and then we publish it. So we uniquely are gaining an idea for the nation about what parents can do.

BOB: Parent engagement can mean a lot of things to different people. There is parent engagement in the civic space. So, get parents to get involved with the pros and cons of charter schools. There is parent engagement that usually is thought of, which is parents with schools. It’s wonderful but it’s not what we are up to.

BOB: So we are the basic parent engagement, the parent engagement with their child. How are they showing their aspirations for their children to go to college? And one of the biggest surprises we had was how ubiquitous those aspirations are among the low income communities.

BOB: The failure to recognize that the low-income families have a tremendous amount of aspirations is costing us a lot of money and is causing us to fail to take advantage of a tremendous resource. What they don’t have is information, and that’s what we try to provide.

HESTER: So tell me a little bit about SOAR MA. So how is this program different than other programs that are out there?

BOB: SOAR MA was the result of a five-year effort where I went every budgetary season up to Beacon Hill to try to get the Massachusetts taxpayers to defray some of the cost of these saving matches. They can get quite expensive. As I said, a million dollars means we have to give a million dollars. So, what happened, was that finally I got the bill through. And it was set up to establish these kind of little Inversants in five different cities that are gateway or low-income around Massachusetts.

BOB: One of the big differences that I love is we’re not alone. We went into those initial cities by ourselves. We were responsible for everything from soup to nuts. Now the Treasurer is with us all the way. She came up with the name SOAR MA. The Treasurer, when she ran for office, Treasurer Goldberg, as one of her main planks was to spread that savings for college across the entire Commonwealth. And she really latched onto this bill when it came through Beacon Hill.

BOB: And so we have all the pieces in place, we’re moving across all five cities now. And I’m very excited to see it open up next September.

BOB: You might think that if you shouted across the street hey I will double your money up to a thousand bucks you could get a lot of people to cross the street. Well, once they got across the street you would have to say well it’s only for college, it’s for your kids, and it’s going to be given to you the day your child graduates from high school.

BOB: That’s not the same deal as Powerball. Having said that, I can tell you that, survey after survey that we’ve done, asking them how important is that doubling of your money. And they all say that it is important.

BOB: So you get—this almost goes back to the demographics, and in it is a very interesting thing. Who are we really getting? We are getting a lot of immigrants. The program is 54 percent Latino. Some of it has to do with the fact that we go into towns like Chelsea that they’re 90 percent Latino.

BOB: We also have going into places where there’s a lot of African-Americans. It’s not uncommon to find our incomes around the 20,000 a year mark.

BOB: It’s not uncommon for our kids to get the full Pell of six thousand five hundred a year for four years because they are at the lowest extremity of the Pell grid to get money.

HESTER: So I think we’re starting to cross over into the other work that your organization does—financial literacy. Can you tell us a little bit more about the financial literacy program that you provide?

BOB: Yes. I already have given you the first nugget that we learned that aspirations are so widespread.

BOB: The other one is that whether you’re middle class, even upper class, or lower class, college has gotten out of financial reach. And it is having a tremendously negative impact on our parents—and that’s why we got into it—and on the nation as a whole.

BOB: So what we are most tuned into, and we’re working hard, to try to get colleges to stop raising their tuitions. It’s not uncommon for the top 100 colleges in the United States to have all raised the tuition over the past 10 years by about three and a half to 3.8 percent. And you might say, “Eh, it sounds reasonable.”

BOB: Well 3.8 percent times ten years—And remember every kid is experiencing at least four of those 10 years—It’s almost 40 percent a year. What other businesses raise their prices 40 percent. There’s only two ways to stop it. Either the government can, or this tremendous increase in nonpayment will. But I’m not sure when or how that will happen.

BOB: I just know that also as we speak especially one loan—the parent PLUS loan—just to give the facts a little bit on that. You have no credit requirement. They don’t check your credit standing. So, it’s an easy loan to get. But it’s a loan which often carries eight to 11 percent interest rates. And so now, one quarter of Parent PLUS loans are in default, and a much larger percentage are over one year in non-payment.

HESTER: So circling back around the financial literacy piece just sharing all of this information about the increase in tuition and the interest rates on these loans, I mean that seems to be valuable information. The interesting thing I think about your financial literacy program is that it is very community based.

BOB: Yes.

HESTER: Right?

BOB: Yes.

HESTER: So tell us a little bit more about that community piece.

BOB: Well it’s an insight that I had standing around a soccer field bored out of my mind, watching my daughter play soccer. All along the field were parents. And what did we talk about? We talked about what we thought of the superintendent. We talked about what tutor the parents were using to get their kids into college. We talked about…We inched around each other on S.A.T. scores. We talked about this teacher who was driving us nuts. In other words, we automatically organically formed a community around sports.

BOB: This is largely lacking in the inner city. It has to be…constructed. The footprint has to be constructed. We construct it at Inversant. When you come into one of our meetings, you’re first given a great meal. You’d probably be coming knowing that you’re going to…get a great meal with the other members of your family. You sit down. You talk for at least a half an hour with the people in your community. You know them. You just don’t get a chance to talk to them, and certainly not about school.

BOB: And that is, for us, community. And we are always urging the school officials like guidance counselors and principals and teachers, to come to our meetings. So they have the best chance they will have all year to talk to their parents.

BOB: You know, even in the best school systems, a principal, a teacher might meet a parent three times a year. So for us…they could meet them 12 times a year. Every month.

HESTER: So when you compare the college persistence and completion rates of those involved in the Inversant program to people in other groups, how do they perform?

BOB: Very well.

BOB: We track that data very closely as well. Which is–which means that we kind of have an alumni association to keep. It’s not easy because they’re all going to different colleges, but we have in the range of 70-73 percent of college persistence in graduation and that’s far above most cities we’re involved with in the national average.

HESTER: That…that is excellent.

HESTER: So one final question for you Bob. How do families learn more about your program, and how do they apply to participate?

BOB: Well it’s a good thing that we’re going to more cities. So, if you’re in any of those cities, I’ll just run down them again. Chelsea, Lynn, Salem, Revere, Boston. Lowell Haverhill. Worcester, Springfield, Pittsfield. There’s a program for you in Inversant. If you live in those cities.

BOB: The second thing is to come to our URL to www.inversant.org. And there you will find a very exciting website filled with blogs over things like college tuition filled with testimonials from our students in their parents filled with examples of our college access curriculum. And pictures of me, which is also very exciting.

HESTER: Well Bob, thank you so much for taking the time on a hot summer day to speak with me.

BOB: It’s been my pleasure and I hope that you have a lot of luck with your program.

HESTER: Thank you so much.