Shekels and sense

Helping someone get on his or her economic feet is the sincerest form of charity, to paraphrase Maimonides. That includes giving “guidance regarding budgeting, financial planning, consolidation of loans, and so forth,” at least according to the book “The Challenge of Wealth: A Jewish Perspective on Earning and Spending Money” by Dr. Meir Tamari.

Which means that Paamonim, an Israeli nonprofit organization that helps people get their finances in order, would make Maimonides happy.

The organization was founded 1997.

Now, Susan Alpert of Teaneck wants to bring word of Paamonim to New Jersey — and maybe some of Paamonim’s projects as well.

Ms. Alpert heard about Paamonim from Chaim Leichman, who is a volunteer for the organization. Mr. Leichman lives in the town of Adam, a couple of miles outside Jerusalem. (He is the son of Abigail Klein Leichman, who writes for the Jewish Standard. His sister is married to Ms. Alpert’s son, which makes them all somehow part of the Jewish Standard family.)

By day, Chaim Leichman is a software developer. But at night, as a Paamonim volunteer, he is a financial consultant. “It’s a real calling, to help people get on their feet financially,” he said.

Paamonim assigns Mr. Leichman a family to work with. They meet every four or so weeks over the course of several months. “We go through a structured process together,” he said. “It’s a process of coaching, of really empowering them to take control of their own finances.”

The process has three steps.

“First we do a very thorough analysis of everything involving money,” Mr. Leichman said. “All their income, all their expenses, all their debt. Typically families come to Paamonim with debt, whether it’s a bank overdraft or something more serious. We put everything on the table to make sure we know what’s going on.”

The second step is to help the family work out a balanced budget.

“It typically means they’ll have to take action in at least one of three different ways,” Mr. Leichman said. “It could be cutting expenses. That’s very common. It could be increasing income. You can have families that are living very modestly but are just not making enough. The third part of the triangle is making sure they are getting everything they are entitled to, whether it’s subsidies from the government or whatever. We make sure all their entitlements are being used.”

Once the family has a balanced budget in place, “we deal with the debt,” he said.

That could mean refinancing and consolidating debt. “If we see they have a killer loan with nine or 10 percent interest, we’ll try to get them a better deal, with four percent interest, for example,” he said. Or it could mean bargaining with the creditors. “If the family has a big debt to the electric company, well get the electric company to let them pay it off over the course of a year or two.

“Our approach is that debt has to be paid, no matter what, but if you have a few different creditors and a few are really on your back and some are not, it’s okay to prioritize. Okay to say, ‘I’ll deal with that debt later.’”

Working with families on their intimate financial lives is a tricky business. Volunteers aren’t assigned families they know — although Mr. Leichman did become friends with a family he worked with. There is the training that Paamonim provides the volunteers, the detailed plans, the apps to help automate budgeting.

But sometimes that’s not enough.

“You have families that never even get started,” he said. “Either they don’t manage to find the time, or they’re not ready emotionally.

“You have cases where in the middle of the process dramatic changes happen in their lives and everything you’ve done is worth nothing.”

There are plenty of families, however, where it all works. “They really want to make a change, they have a positive attitude. There are families that will decide right away they don’t need more. I had a family about a year ago where working on the debts was all they needed. We identified the problem very quickly. They knew what they needed to do. We literally met twice.”

So what’s the secret to making a family budget?

“There’s no magic,” Mr. Leichman said. “That’s part of what I like about Paamonim’s approach. It involves commitment. It involves work.

“If we see a family bringing in 18,000 shekels a month” — about $4,750 a month — “we say, let’s make a budget with that. Almost inevitably they will come to the conclusion they have to cut something. Or more than just one thing.

“We don’t make decisions for the family. To take an extreme example: You can have a family that spends an extraordinary amount of money on cigarettes each month. It’s up to the family to decide whether they want to keep that and cut something else, or whether they want to cut that. It’s not our place to make decisions for them.

“A couple I worked with were both chain smokers. They were spending 2,000 shekels a month on cigarettes — more than $500. They realized that was ridiculous, but I couldn’t say that. They were the ones who had to say that.”

What to cut if you’re not smoking cigarettes?

“Food is a very big expense. A lot of families will live more frugally with their food budget. Electricity can be very high. There can be a conscious decision about using less. Another thing could be going to restaurants or going to movies.

“Even though the rent or mortgage is a very big line item, most families are not willing to make any drastic changes with that.

“One other big-ticket item is cars. I had this family that was living very frugally aside from the fact that they had two cars. As expensive as it is to maintain a car in the States, it’s more expensive here. It was very difficult for them, but they parted with one of their cars. It was a huge savings.”

“The most frustrating cases are families that are already trying to live frugally, just trying to make ends meet. These are the most frustrating cases. There’s no magic solution. It either means some dramatic change in income — which is much easier said than done — or some dramatic steps in cutting costs, that are very difficult.”

Mr. Leichman is one of 3,000 volunteer counselors who deal with 20,000 Israeli families each year, Ms. Alpert said. They work in 800 locations, from Eilat to Kiryat Shmonah.

“Their success rate is a surprising 75 percent,” Ms. Alpert said. “Each family will save about $10,000 just in the first year. The savings grow.”

Paamonim partners with the government to provide financial education for Israelis of all ages, from school through retirement.

Ms. Alpert finds Paamonim an Israeli counterpart to Bergen County’s Project Ezrah, the Teaneck-based organization that helps people find jobs. Ms. Alpert worked for Project Ezrah as a fundraiser for 16 years.

“I like the idea that people are taught to be responsible on their own,” she said. “Paamonim is asking for money not to support people, but to make more programs that will help them. It’s like the flu shot. It’s preventing disasters from happening. I love that people work within their own resources to be successful. The self-esteem it brings is unbelievable.”

Ms. Alpert is starting the American Friends of Paamonim. But she doesn’t want the relationship between American Jews and Paamonim to be one-way. She has ideas for ways to bring Paamonim over here.

One possibility is to have Paamonim counselors work with people who want to make aliyah so they can have a realistic idea of what they would face financially. The families would consult with counselors “either through Facetime or email or a combination and work out a pro-forma budget with them so they know what their life in Israel will cost.”

She’s also considering importing some of Paamonim’s physical products.

“They have a wonderful tzedakah box for children that teaches financial literacy. I’d like to bring that here. They also have some wonderful games like financial chutes and ladders in Hebrew that would teach children financial literacy and also help them with their Hebrew. It would benefit Paamonim when it sells and benefit our community with financial and Hebrew education,” she said.

One thing she won’t do, however, is launch American Friends of Paamonim with a huge fund-raising dinner.

“That wouldn’t be financially responsible,” Ms. Alpert said.