It Pays to Listen to Your Wife
When Jose Edward Peña's wife told him how he could double his savings with something called an IDA. He didn't believe her. She had the same doubts the first time she heard this promise, years ago, when she was a Section 8 tenant with the Des Moines , Iowa , housing authority. Later, when she was considering a return to school, Maria came across an IDA flyer. Though still skeptical, she contacted Iowans Save!, the local IDA program operated by the Institute for Social and Economic Development (ISED).
Their training, and the IDA, was a better fit for Maria than going back to school. "They put me into classes. The first class was money management. Homeownership training came later," she says. And she could take her children with her: "They sat with me, and we studied together."
This is when Jose Edward re-entered the scene. After three-plus years in prison and drug rehabilitation, he had an eye toward re-establishing his family's economic base. He got a job working at a car dealership but wasn't making enough to realize his dreams for Maria; Abigail Joyce; Jose, Jr.; and Kendra Jeannette. "You come to a point in your life when you have to do something not only for yourself but for your family and kids. I wanted to leave something for them," Jose says.
Jose worried about how Maria was investing her money. While in jail, he had learned about lots of scams. Nevertheless, he got interested in IDAs at a free EITC tax preparation site he and Maria used. There, an Iowans Save! staff person explained the program. The credibility of their partner organizations helped him decide to participate.
Maybe the IDA was the piece they needed.
"Looking back," Jose says, "everything fell into place, but at first I was not sure how to use my savings." He did know he wanted to earn more and have more independence and so took out a loan for a three-month course in driving big rigs. School was five hours a night while working full-time. Jose says, "I needed something now, not in two to four years"
Obtaining his commercial license did allow Jose Edward to more than double his earnings—but not right away. He was offered the best-paying jobs in trucking, the long haul, cross-country trips, but those weren't good for being around much as a father for the children, then ages 15, 9, and 6. So Jose Edward kept searching for a local position, kept saving in his IDA, and finally landed a full-time job driving a cement mixer for Mannattes, a local highway construction firm. His earnings jumped to about $900 a week. "I had made my first goal, which was to make at least $100 a day," he says, room enough for some saving and paying regularly on his school loan, which also helped boost his credit rating.
But Jose Edward thought the work might drop off during the winter, so he told his Iowans Save! counselor he wanted to use his IDA savings to start a small business. Years before, he had managed convenience stores. From Iowans Save! he had learned how to do taxes, track costs and income, and do a business plan. With that, and six months of IDA saving, he made a down payment on a small truck to do snow removal. As luck would have it, his temporary employer already had contracts and asked him to be a substitute, giving him a foundation of steady work.
Meanwhile, Maria Peña was steadily saving in her own IDA. She had a better job as well and, between them, the Peñas had two savings accounts and steady income. Says Jose Edward, "Bankers were glad to talk to me about the truck loan and then later a home mortgage."
A home was their next goal. Maria was saving about $250 a month by not buying clothes and staying home. She says, "I told the kids we didn't have any money." Neither Maria nor Jose Edward had serious credit problems, though they did have some very old debts to settle. Part of their tax refunds went to debt and part for their savings. In October 2004, the Peñas moved into an older home on a large lot. "The kids and I love to garden, but we didn't have enough sun or space before," Maria says. "It already has a garden with tomatoes and apple trees." There are even climbing roses. "When I started the money management class, we wrote down what we wanted to accomplish," said Maria. "It actually did work out."