Advice from Successful Savers
Maria recommends paying yourself first and making savings deposits quickly. “I knew it was money I wouldn’t touch. It can be tempting once you get it, but I made sure I went to deposit it right away.”
If there’s one thing you should know about Maria Barerra, it is that she is a focused woman who gets what she wants. “I didn’t find saving hard,” she said. “I had my mind set and that was it.”
In 2007, Maria had to move out of her affordable housing unit in the District due to building remodeling. Uncertain of what her living situation would be after the remodeling ended, she began thinking about buying her own home, a permanent place where she could control how long she wanted to stay. “I’ve always wanted a home that was mine,” Maria said. “And [I knew] if it was possible, God would make it happen.”
Buying her home was not an easy feat, however, and Maria needed additional financial assistance. Seeking help, Maria went to the Latino Economic Development Corporation (LEDC), a CAAB partner. At LEDC, Maria learned about the Home Purchase Assistance Program (HPAP) and was excited to participate. However, after further investigation, she found out that she would not be able to afford a home, even with the assistance from HPAP and became quite distraught. “I told LEDC I would have to give up the dream,” she said. “But then they told me about the lottery system.”
A lottery promoted by LEDC and sponsored by Manna (another CAAB partner and a nonprofit housing developer) gave entry participants the chance to win newly developed properties in the Chinatown area. These units were set aside by for-profit developers especially for sale at below-market rates. Maria entered the lottery and one week later, on her birthday, received the call that she had won! “I thought, ‘I have nothing to lose, and lot to gain if I win’. It was the best birthday present ever,” she said.
Now that Maria had won the chance to buy an affordable new home, she needed to save for the down payment and additional costs, and this is where CAAB came in. Maria signed up for CAAB’s Individual Development Account (IDA) program and began saving as much as she could. In addition to working as a chaplain, she began babysitting, walking dogs, cooking for others, and any other tasks she had time for to make extra money. All of the extra money she made was deposited into her IDA and $1,000 was matched at a rate of 3:1. “I knew it was money I wouldn’t touch. It can be tempting once you get it, but I made sure I went to deposit it right away,” she said. After making regular deposits into her IDA and being in the program for about seven months, Maria had enough money to close on her home.
One of the best things about the IDA program, according to Maria, is the financial education provided through the Money Management 101 (MM101) course. “People have the opportunity to learn many things, not just about home buying, but about credit, managing money… [And] starting a business and going to school,” she said. In MM101 Maria learned the importance of having an emergency fund for ‘rainy day’ occurrences, and began to put money aside each month. Now, after recently being laid off from her job, she is thankful for the funds available in her emergency account. “I planned my emergency fund, not knowing my position would be terminated,” she said. “And now I won’t lose my home.”
Maria hopes others will follow in her footsteps. “There are a lot of social programs in the District that can help low-income people to develop skills, and you should take advantage of them,” Maria says. And she advises everyone to put aside some money via regular savings to build a safety net in case of emergencies. “Once you start doing it regularly, you get into a mode of saving—that makes it easier to save,” she said.
Maria is grateful for her home and though she has lived in it just since February 2008, she has already saved enough money to remove the carpet and replace it with hardwood floors which make it easier for her to clean, and also move around in her wheelchair. In addition to this being Maria’s first home, it is also her first place of residence that was made wheelchair accessible. “It just makes it so much nicer and better on my body,” she said. Next on her list of things to do is paint her home and slowly start to acquire additional furniture. “Every morning when I wake up…I look at my place and I know how much I’ve been blessed.”