CreditRich co-founders detail the value of credit and having a ‘wealth management system’
CreditRich Co-Founders Angel Rich and Courtney Keen join Yahoo Finance Live to discuss their partnership with Visa to promote financial literacy and help communities build up their credit scores, in addition to how their app will aid in managing debt.
SEANA SMITH: Well, fintech company CreditRich is making it easier for people who want to improve their financial status and also build credit. The company recently partnering with Visa to create debit and credit cards for millennials, Gen Z, the Black community, and the underbanked. And joining us now are CreditRich co-founders, Angel Rich and Courtney Keen. Angel and Courtney, it's great to have you both. Thanks so much for joining us.
ANGEL RICH: Thank you so much for having us. We're extremely excited to be here with you today.
SEANA SMITH: It's such an important topic. And Angel, let me start with you because data-- the most recent data that I saw from the Consumer Financial Protection Bureau shows that about 45 million adults are considered credit invisible, meaning that they have either no credit score or very, very thin credit files. How does your partnership with Visa and some of your past partnerships help address this massive issue?
ANGEL RICH: Yes, we are thrilled that Visa takes the underserved community very seriously to the point that they have put their money and their heart where their desires are and partnering with us. They have not shied away at all for wanting to work with this community. And we know that our product is going to bring heightened rewards, as well as credit expansion, that helps them to have overall financial prosperity and ultimately be able to get better credit options.
SEANA SMITH: And Courtney, I was looking at a few more statistics. The US is the largest world economy. We all know that. Yet, the Standard and Poor's Global Financial Literacy Survey ranks our country at number 14 while measuring the amount, the portion of adults who are financially literate. Being financially literate is such a key piece in all of this. Talk to us just about the importance of this and what you guys are doing to educate those who may not be familiar with this right now.
COURTNEY KEEN: Yes, it's very important, especially when you're going out, building your life after college. You buy a house, getting a car, getting loans to start businesses and such. And it's a shame that a lot of people don't understand how credit plays into that and just building up your life and following your dreams. So we're here to teach people about financial literacy, understanding your credit, how to budget properly, just to help you live a better life and go after your dreams.
SEANA SMITH: And Angel, the roles that employers play in all this, because we know employers like to prioritize health, they like to prioritize other benefits. They don't necessarily take financial literacy into consideration. What's the role that they should be playing and could be playing in this?
ANGEL RICH: You are pulling all my heartstrings. At my former corporate position, I helped them build the wealth management system there. And I felt as though it was critical to have this across the organization for employees. And that was 10 years ago. I am shocked that in today's climate, that every organization does not have a wealth management system akin to a health management system. One of the greatest stressors in life is your finances, and it's directly connected.
So if you can help people alleviate the pain of that little three-digit number that sometimes can make or break their life that can make the difference between them being in an apartment or in a home or their child going off to a college of their choosing, it is essential that these employers offer programs like CreditRich. And we hope that we can become a great measurement tool with these companies.
SEANA SMITH: And Courtney, what about the mistrust a lot of times in some of these underserved communities, when it comes to the larger financial institutions? I guess, to what extent is that contributing to the racial wealth gap that we have in this country? And what can those larger institutions do to rebuild that trust?
COURTNEY KEEN: Yeah, a lot of that has to do with just the lack of education. And a lot of times, minorities look at those with wealth that do not look like them. So as long as we provide them with the knowledge that they need to succeed and get there in life, especially those that they look up to and people that they see in media, this really helps to close that racial wealth gap.
SEANA SMITH: And Angel, I know you graduated college with over $100,000 in debt, so you have your own experience with debt. For people out there who are listening right now, who want to get a better handle on the debt that they have and improve their credit, what's one or two steps that they can do immediately?
ANGEL RICH: Yes, so, well, that's actually kind of the premise behind our app. Our app allows them to be able to round up their spare change to pay their bills intelligently in the most optimal manner. And we're excited to be in partnership with Visa, as well as Experian. So for the first time ever, we have streamlined mobile banking, credit reporting, and online payments in one system.
So if you have $180,000 worth of debt, and you only have maybe $500 in disposable income, you want to make sure that you are putting those payments towards the debt that is going to have the greatest impact to raising your credit score. So you want to be looking at things like how long the debt has been on your credit, what the length of time is, if it is greater than $10,000, if it is a student loan, if it is a revolving credit item. All of these different things have multiple different impacts.
And another thing that our app helps you do that I'll give a tip on is setting a budget for your spending towards the debt that you want to pay off. You should be taking a good 20% of your disposable income and putting that towards paying off your debt and building your credit. And ultimately, even if you have a great credit score, don't just sit on that 750 or that 850. We want to help you become credit rich, because you might only have a capacity of $50,000. We want to get you to maybe a million dollars of credit capacity.
SEANA SMITH: I think everyone loves the sound of that. Angel Rich and Courtney Keen, thanks so much for joining us, co-founders of CreditRich.