Financial books for tenants

[Jason Miller]

An idea Ive been toying with for a while is giving financial books to my tenants.  Specifically the Richest Man in Babylon and The Total Money Makeover.  I realize you can lead a horse to water, but my theory is that if If just 1 in 100 tenants listen or read these books and help their financial situation, it may reduce my turnovers and cost of turnovers.

I'm curious as to if anyone has tried this or something similar in their welcome package.

[James Furlo]

This is an excellent idea and something my wife and I do, plus a little more.

When we screen someone, we get their credit report. We use that as an opportunity to talk about their finances. We'll literally sit down with them while signing the lease documents and talk about their specific financial situation. I also mention this during the pre-screen phone call. One of the things I like to talk about is saving for emergencies, "That way when you have an emergency, it doesn't suddenly become two. One of which is not being able to pay your rent on time." Everyone we talk to really appreciates it and takes our advice to heart. I had one former tenant call me one day all excited because he recently applied for credit and found out his score was a lot higher because he had been paying off his debt like we recommended. That's a huge win and I couldn't be happier for him. We helped another avoid bankruptcy. Another we advised against a costly purchase by pointing out the monthly recurring costs and the stress that would put on his budget. That lead him, with our encouragement, to get a better job so he could afford the "fun things in life". I even spent 45 minutes one day doing a mock interview to help him prepare.

We then stepped it up a notch and started giving new residences The Total Money Maker as well. Since we know their situation, I'll recommend specific sections for them to read. Then during our 90 day "Water and Fire Alarm check-up" I'll also ask about their finances. Do they have an emergency fund? Are they tracking their spending? Are they spending less than they earn? What did they think of a section of the book? I try to as casual as possible so they don't feel bad if they're not on track.

I've thought about tying a financial incentive to creating an emergency fund. Like require last month's rent (or extra deposit) that I'll return once they show me their account with at least $1,000 of an emergency fund. I haven't done that yet, but it's an idea that's interesting to me.

Finally, every month I write a newsletter for each resident. In the newsletter I include one financial article, one recipe, a decorating tip, and other interesting articles (often some house hack from lifehacker.com). It's another way to provide education and let them know we care about them as individuals.

All of this does take time, but it's something I feel is critically important to people's development. So yes. I think it's a fantastic idea. It's good for business, it's good for society, and it's good for them.