Adultery, Amnesia and ... 401(k)s? Latino Soaps Offer Financial Advice

By Eric Hinton

e-mail article |

print | post comments | NEWS LETTER

October 25, 2007

Picture this scenario: On your afternoon soap opera, two young Latino lovers are in a tight embrace with dramatic music rising to a crescendo in the background. But just before things reach a heated climax, one reaches for a stock portfolio and starts talking about how well his 401(k) has performed for the month.

Unlikely? Perhaps. But while soap operas and stock tips might not seem like the most natural pairing, U.S. Treasurer Anna Escobedo Cabral thinks it may be a key to increasing financial literacy in the Latino community.

Speaking at a conference sponsored by Ariel Mutual Funds and the Charles Schwab Corp. last week, Cabral said she is talking with producers of English- and Spanish-language soap operas about intertwining issues on financial education between the sex, adultery and amnesia storylines commonplace on most afternoon soaps.

"We need to do a good job of reaching people, but in very creative ways," Cabral said in a story reported in The New York Times.

According to the report, Spanish-language television network Telemundo, which is owned by NBC Universal, has expressed interest in Cabral's suggestion. Cabral has also suggested the financial-literacy efforts could be developed into various formats, including iTunes.

Regardless of what format the advice comes in or what device is used as the messenger, the financial advice couldn't be timelier or directed at a more needful audience. As the subprime-mortgage crisis escalates, analysts expect black and Latino homeowners will be disproportionately impacted, as they are more prone to be the recipients of subprime loans.

Just yesterday, Rep. Barney Frank, D-Mass., was in Congress debating legislation he proposed that would establish federal supervision of mortgage brokers. His proposal would restrict prepayment penalties and ban lenders from paying rewards to brokers for persuading borrowers to accept higher interest rates than the rate at which they qualified.

Television may be just the way to go to reach this rapidly growing audience, particularly U.S.-born Latinos, who by 2020 are expected to represent more than 75 percent of U.S. Latinos, according to census data. Twenty percent of U.S.-born Latinos watch Spanish-language television channels, such as Telemundo, according to Nielsen Media Research. (See also: How to Reach U.S. Born-Latinos Through TV)

Although the vehicle of soap operas may be new, attempts at increasing financial-literacy efforts directed at the Latino community isn't a new concept. The National Council of La Raza released a study in 2005 noting that Latinos were not benefiting from policy efforts to improve wealth-building skills.

"Because Latinos tend both to be asset-poor and to have lower comparative incomes, many are barred from accessing the best financial advice that the market can provide," said Beatriz Ibarra, an NCLR assets policy analyst who authored a 2005 report on Latino financial literacy. "There is no indication [Latinos] are changing their behavior or [information] is reaching the people intended to reach." (See also: Latinos Need Counseling, Incentives to Improve Financial Health)

More Career Advice >> More Diversity Management >>