Kiley and his wife TyLisha Summers experienced first-hand how challenging the road to financial freedom can be. After they graduated from college, they walked away with more than $100,000 in consumer debt.
Instead of focusing on the negatives that comes with being millennials saddled with debt, they chose to find a solution. After dedicating years to paying off their debt, they founded SpenDebt, a fintech startup that enables users to pay off debt through micropayments from every day purchases.
Several challenges impact Black families who look to secure wealth and build financial wellness. The systemic inequalities and racial gaps in finances, high default rates on student debt, and employment discrimination are just some factors that have kept Black people from realizing true financial freedom and generational wealth.
Kiley Summers spoke with the Defender about the SpenDebt app and the solutions it will provide for your finances.
Defender: Where did your journey to financial freedom begin?
Summers: My financial freedom journey adolescent. I watched my single mother raise three boys and she rob Peter to pay Paul to make ends meet. But her bouts with money was my first observance of how to manage a household. Fast forward, I became a first-generation college graduate. At the beginning of my career, between my wife and I, we had over $140,000 in consumer debt. At that moment, we thought back to our humble beginnings. We knew we had to do something different in order to break those generational curses. We began to work on it and make it a priority in our household and after some time we became debt free.
Defender: $100,000 is very steep. How long did it take you to get out of debt and what was your strategy?
Summers: It took us seven and a half years. We weren’t perfect in our planning process. This was before some of the great financial education programs and technology tools came to be. So, we were manually at the end of the month taking all the extra [money] we had and applied it to the debt. We used what we called the ‘debt snowball’. It was a process that works. We wanted to find a way to stay focused. That’s how we got out of debt.
Defender: That inspired you both to launch SpenDebt. What is it and how does it work?
Summers: SpenDebt was inspired by our debt journey. God planted this idea into my head to help people spend money and pay off debt at the same time. When you think about how it works, let’s first understand some of the products in the marketplace prior to SpenDebt launching. You have Bank of America Keep the Change Program, which is a spend and save program. You have Acorns, which is a spend and invest platform, so there was no category to allow people to spend and payoff debt. How SpenDebt works is the user comes to our platform, whether they find us in the App store, Google and Apple, or on our website SpenDebt.com, create a profile, link the bank account you want to pay from, tell us the debt account you want to pay into [Student loans, mortgage, car note], and the last step is you defining the micro payment and it could be anything greater than 50 cents. We don’t use roundups. That’s out differentiator. For example, Sally goes to Starbucks faithfully every. She buys a $5 latte. Automatically $1.00 is added to that transaction. $5.00 will go to Starbucks and $1.00 would go towards Sally’s Navient student loan over the course of the month. We aggregate all those transactions and send a one-time payment on behalf of Sally to Navient to help her do one of three things, help her commit to paying the student loan because she hadn’t done it, or because she is falling behind, or to help her accelerate paying it off.
Summers: What the average debt that someone can pay off with the SpenDebt app?
Summers: It could be any debt. We have people with small debt like $300 on a credit card, and her have people paying off their mortgages. Whatever the appetite is for the customer, they can pay off anything they want.
Defender: What sets it apart from other financial apps?
Summers: We don’t use roundups. Roundups may work for some, but we believe that it doesn’t give you that nest egg. We give the control to the consumer and let them define what the micro payment is. It’s a way for us to intrinsically help develop financial education incorporated with the activity of our product. The other is that we can pay any consumer debt. We pride ourselves in that because we want to be able to walk alongside our customers to be what they need us to be to help them get financially healthy. The platform allows you to budget, meaning you can set up a cap amount. If you don’t want to spend no more than a hundred dollars using SpenDebt, the app automatically stops deducting those micro payments and restarts it the beginning of the following month.
Defender: What was the process to get this idea off the ground?
Summers: We didn’t know how to build a financial technology company. I’m an engineer by degree, so that helps in having experience as an operation professional. It was really just talking about what we wanted to do get people to help and support you. Getting the support of people who can help build or develop the app. The hardest part was to find qualified people with that type of domain expertise. Then we were thinking about how it was going to work. My co-founder is my wife, Tylisha. I remember putting the concept into Excel to show how spending money can help pay off debt. The we built a business model and tested a few ideas. The same model we started with is not what we have today.
Defender: How is the business going so far?
Summers: We started this journey in launching our product in 2018 and now in 2020, we’ve expanded our market strategy. Any consumer anywhere in the country can download the app. We are expanding the model for small business companies up to enterprise level companies.
Where can people find the app?
Summers: You can go to Apple, iOS app store, Google Play store, or go to SpenDebt.com. We would love for you all to sign up and be a user. The first month is on us. It’s a 30-day trial. If you don’t like it that’s okay, and if you do give us a review. At the end of the day, we want to partner with the people.
Laura Onyeneho covers the city’s education system as it relates to Black children for the Defender Network as a Report For America Corps member. Email her at laura@defendernetwork.com
