WASHINGTON - The Consumer Federation of America on Tuesday said it is teaming up with banks and credit unions this spring to offer low-cost savings accounts and teach consumers how to build retirement nest eggs.
In the America Saves program, people will not have to pay monthly fees but will be offered counseling on how to set financial goals and plans. The program is slated to begin in Cleveland next month and Kansas City in April, then expand to other cities.
So far, the federation has lined up partners only in Cleveland. National City Corp. and KeyCorp of Cleveland and Huntington Bancshares of Columbus, Ohio, are among the 10 banking companies and credit unions participating there.
On Tuesday, the Bank of America Foundation pledged $300,000 to fund the program's launching. A previous grant of $100,000 from the foundation had funded planning and research.
"Americans want to save and believe they can, if someone will just give them some ideas how," Lynn Drury, the foundation's president, said at a press conference. "Our grant will help CFA to organize and support local and national savings campaigns vital to consumers across the nation."
The federation released a survey showing that the typical family has net financial assets of less than $10,000 and has recently lost wealth because of rising consumer and home equity debt. The study by Princeton Survey Research Associates found that 53% "live from paycheck to paycheck" at least occasionally. This rises to 64% in the $20,000-to-$50,000 income bracket and to 79% for those earning less than $20,000 per year.