MIT Alumnus Seeks Financial Empowerment for All

In February 2014, President Barack Obama named José Cisneros ’78 to the new President’s Advisory Council on Financial Capability for Young Americans. In large part, this was an acknowledgement of Cisneros’s work to help lower-income residents in San Francisco enter the financial mainstream. Appointed city treasurer in 2004 and elected to three terms since, Cisneros has spearheaded innovative financial programs for adults as well as kids.

Cisneros launched his Office of Financial Empowerment because he believes that all San Franciscans are responsible for safeguarding the city’s money. “When people use fewer resources, maintain current resources, and contribute new resources through taxes, San Francisco stays strong,” he says.

Perhaps his most well-known program is Kindergarten to College, credited with helping thousands of children from low-income families start saving and planning for higher education.

The program works this way: each fall, as some 4,500 new kindergartners begin public school in the city, they receive an initial deposit of $50 in a savings account. In the years between kindergarten and college, a student’s family can add to the account and receive bonuses and matching funds in the process. Families can withdraw from the account only to pay for tuition and other expenses for the child’s postsecondary education.

“We all know $50 is not going to pay for college,” Cisneros told one interviewer. “[But] just the existence of the account builds aspiration in the child’s mind.” And this assertion is backed up by research: a 2010 Washington University study reported that children with savings accounts are up to seven times more likely to attend college than those without an account.

After earning a bachelor’s degree in management at MIT, Cisneros worked in both finance and management at Bank of Boston, Lotus Development, and IBM. That, followed by two years at the San Francisco Municipal Transportation Authority, gave him the skills he’s used to tackle such ambitious projects.

Cisneros’s dream of financially empowering low-income families now extends beyond San Francisco. More than 100 cities and communities have replicated his office’s Bank On program, which helps families find and enroll in fee-free checking accounts. In 2008, in partnership with New York City, Cisneros founded the Cities for Financial Empowerment Coalition. The coalition now works to advance financial empowerment opportunities in 14 major cities across the United States. More than 21 million American households have access to its programs.

Last year was an exciting one for Cisneros personally as well. A longtime advocate of rights for same-sex couples in California, he married his partner of 24 years in August.

This article originally appeared in the March/April 2015 edition of MIT Technology Review magazine.