Building Assets: Day Care Centers
Southern New Mexicans Build Assets & Day Care Centers…
Dina Ramirez, owner of Arcoiris Day Care financed her business expansion with $5,000 from her Individual Development Account (IDA), a matched savings opportunity available to lower-income households that don’t have the opportunity to take advantage of tax credits and rebates available to those of higher income.
Ms. Ramirez learned about the IDA initiative from the person who licenses day cares in her County. The IDA initiative in Doňa Ana County, New Mexico provides $4 match for every $1 that is saved, up to a $4,000 match. With this savings incentive, along with financial capability training and business plan support, participants are able to put dreams into action and take significant steps toward economic stability.
When asked how her financial management has been impacted, Dina Ramirez states, “Now I pay the bills and everything else goes in the bank.” Arcoiris Day Care not only is Ms. Ramirez’ livelihood, it is also a family business. As a single parent Dina works with her 13 year old daughter who helps her plan the meals for the children.
Dina is thankful for the support that she receives from the community programs in Las Cruces, as well as help from the Community Action Agency of Southern New Mexico (CAASNM) with her taxes every year. She feels she can always turn to CAASNM for assistance.
Concepcion Marquez was able to establish Connie’s Day Care in 2010 through successful savings in her IDA. In 2012 she re-enrolled in the 11-week financial capability course, and took her husband with her. Although the Day Care Center is stable, her husband had a rough work year which is making savings a challenge. She dreams of expanding her home business and is determined to apply the principals that she has learned from financial education as well her past success in putting savings aside.
IDAs were created to provide an incentive to savings, investment and asset accumulation among moderate income, working families. Assets – such as a business – enable lower-income families to move into the economic mainstream
Prosperity Works partners with community based organizations and tribal entities throughout New Mexico to advocate for policies that support economic prosperity for all New Mexicans. It is through this statewide consortium that Prosperity Works implements and funds New Mexico’s largest community-based asset building initiative; over 1200 Individual Development Accounts have been opened in New Mexico since 2006; nearly 700 families have purchased their asset; over 500 continue to save each month. The state map represents savers throughout the state.
At one community-based partner, 11 IDA savers have invested in Child Care Services.
- All saved over $1,000 in an IDA, and were matched with $4,000 for business expenses
- 9 expanded existing businesses
- 2 started new businesses
- 4 left school following 8th grade in order to work
- 6 currently own their own homes
- All mention the financial education as key to their success
Sometimes it is one simple thing that keeps a family from moving forward economically. Mi Casita Feliz’ owner Yolanda Garcia could not license her Day Care business she did not have a vehicle that could be used for emergencies. All she had was a truck, and that did not allow her to be a licensed center. With much tenacity, Ms. Garcia saved as much as she could spare each month for 9 months in order to purchase a van. During this time she also continued her education and set aside a significant portion of her income tax return. After purchasing the van Yolanda stated, “I had the encouragement to continue my education in early childhood development; I now run a 5 Star Certified Day Care!”
“Even after we learn how to save, it is still a struggle to get out of existing debt,” says Olga Casillas, owner of Prequenuelos Day Care. She found out about IDA’s through the local food program that provided much-needed subsidies to her family. Always teetering on the brink of hunger and juggling bills month-to-month, Olga seized the opportunity to put a small amount of money aside in IDA savings each month. After 12 months of savings $1,000 through income earned from extra employment, Olga was able to use her IDA savings ($5,000) to heighten the fence that surrounds the outside play area of her at home day care. “The kids couldn’t have gotten out before with the shorter fence, but now no one can get in. The number of children I care for is 6, and now they are safe. The higher fence helped me create a safe, secure, nurturing environment. Community Action Agency of Southern New Mexico [the local IDA provider] does a lot for us; they provide all kinds of classes and even help us with taxes. They do what is good for us.”
Irma Fernandez added air conditioning to Irma’s Day Care in Anthony, New Mexico, where summer heat can become a health hazard. Irma says “It is hard to be a business owner. Taxes are very high and now there is a new large day care center in town and they may take work away from me. But this program [The IDA] gave me the self-confidence to realize my goals are not just a dream: they are attainable!”
Martha Mireles previously cared for one child. She used her families ‘hand me down’ toys and equipment to care for the child. She learned of the IDA program while participating in a community wide financial education course offered by CAASNM. “Before that class, I was an impulsive shopper,” says Martha. “The class helped me to think before I buy; the class also helped my husband plan for his retirement.” With the matched savings, she was able to bring her home up to code in order to start a community day care. “We put in a watering system, a cement area, and a sand box. It helped us to provide a safer and more appealing outdoor area for children. We also were able to purchase the proper insurance. I now care for 6 children.” She adds, “Eventually I would like Mireles Day Care to have a space just for kids. That’s my new goal now and we’ll see how it goes… I am 71.”
Prosperity Works partners with Community Action Agency Sothern (CAASNM) to implement IDA’s in Southern New Mexico.
With strong community partners like CAASNM, Prosperity Works fulfills its mission: to see that every New Mexican has the opportunity, knowledge and relationships needed to achieve economic security and prosperity. Prosperity Work’s believes that New Mexico is the best place in the nation to be born, reared, educated, work, live and grow old. For 11 business owners in the southern portion of New Mexico, it is the best place to start, expand and grow their own business.