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Lessons from the Field: CA$H Maine Finds Ways to Increase Financial Capability of Taxpayers at Tax Time

By Craig Sandler on 03/28/2017 @ 12:00 PM

Tags: Financial Capability

Each year, many VITA and community-based organizations help taxpayers file their returns and leverage this moment to focus on ways to enhance their financial well-being. One of those organizations is CA$H Maine, which is a statewide collaboration of ten coalitions, comprised of 50 non- and for-profit partners, working together to help empower Maine individuals and families to achieve long-term financial stability. They have been working with CFED through a VITA technical assistance project this tax season and we wanted to share a few lessons and highlights from their work so far this year.

We interviewed CA$H Maine’s Financial Capability Project Coordinator, Janet Smith, about their work this year. Five of CA$H Maine’s coalition partners participated in the technical assistance cohort, each taking on unique goals based on lessons they’ve learned working with taxpayers on financial capability:

  • One coalition wanted to increase the number of tax filers who took advantage of savings programs, so they had their filers label mason jars with their savings goals, such as “I am saving for…” as a visual aid that encouraged the use of those programs.
  • A second coalition that works with Native American populations in the state used a financial check-up program with their tax clients, and used the info that they gathered to provide a more full picture and determine other programs clients would be eligible for, such as HUD counseling programs like credit checks.
  • Another coalition, in order to increase the number of tax filers participating in financial capability services, created private spaces where tax clients could feel comfortable speaking with staff and volunteers about financial capability in a more private setting.
  • A fourth coalition, the biggest tax site in the state, worked to make sure volunteers were educated around financial capability services and the advantages those services provide for tax customers. They also trained some of their VITA greeters to talk about financial capability with filers.
  • Finally, the fifth coalition in the cohort used a financial coaching program from Points of Light’s Financial Opportunity Corps, signing up tax customers to participate in the coaching program as well as IDA services.

CA$H Maine worked to coordinate the work of the five coalitions within the cohort by using a consistent intake form across all sites so as to comprehensively track asset building and financial capability work. The intake form also helps staff and volunteers guide tax customers toward the best resources for their needs: for instance, the form asks tax customers, if they receive a refund, what do they plan to do with it? If they check off that they plan to save their refund, then staff can help connect them to IDA programs and other programs that help with savings.

As another example, the intake form asks clients to rank their top three financial goals, such as saving for a home, saving for retirement or paying down debt, which can in turn lead to other conversations and services. Clients are also asked about their financial challenges which, again, can help start conversations with staff based on the challenges they identify.

CA$H Maine’s work is one example of how organizations are advancing programs and service to better meet taxpayer needs and increase financial security and well-being. If you’d like to learn more about lessons learned and resources on building financial capability at tax time, check out CFED’s webinars on Leveraging the Tax Moment to Build Financial Capability, Financial Capability at the Tax Moment and Tax Time Savings.

How Financial Capability and Education Can Help Underserved Communities with Kate Mielitz

By Ariel Sankar-Bergmann on 03/10/2017 @ 10:00 AM

Tags: Financial Capability

Kate Mielitz is a Ph.D. Candidate in the Personal Financial Planning Program at Kansas State University and an Accredited Financial Counselor (AFC®). Her research focuses on the financial education and capability of underserved populations, specifically individuals transitioning out of the criminal justice system. To better understand the banking and financial experiences of individuals in reentry, we interviewed Ms. Mielitz about a recent research project.

Tell us about your research design?

Sure. Let me give you a little background on how I began working on this issue. Previously, I worked as a financial educator in Georgia’s Transitional Center system. During this time, I spent a lot of time wondering “was I teaching the right thing?” and more importantly, “was I setting up participants so that they could be financially successful upon their return?” To try and help answer this question, I developed a curriculum and decided to evaluate the effectiveness of that curriculum with the participants in my classes. This process led me to want to do more research on the financial needs of inmates and individuals in reentry.

I approached this project in two distinct phases. During the first phase of the project, I wanted to understand if my curriculum was working for my students. The results from that phase of the project were encouraging because inmates who participated in my classes increased their financial knowledge and that increase was statistically significant. I knew though that we needed to get a better understanding of inmates’ general financial knowledge. This led to the second phase of my project where we developed a survey instrument based on the Jump$tart financial literacy survey and began to collect data from inmates who were 90 days from their parole or release date. In addition, we also conducted in-depth interviews with 40 former offenders so that we could really gain a complete picture of how former offenders understand their financial lives. I felt that using this mixed methods approach was important because it allowed us to capture the lived experiences of former offenders along with survey data that measured their understanding of specific financial topics.

What finding were the most surprising to you?

We surveyed 300 inmates who were still incarcerated and less than 60% of respondents were able to answer basic budgeting questions. Less than 50% of respondents were able to answer questions about secured and unsecured borrowing and less than 20% could tell which of the savings account options would be best for long-term savings. Surprisingly, we found that individuals who had more than one incarceration actually had higher financial knowledge but we are not sure what that is attributable to.

During the interviews, the theme of barriers emerged. I defined barrier as being something that inhibited action or change. One of the common barriers I saw was that participants were unable to open a bank account after they were released because the only form of identification they had was a corrections ID. This is a state ID so it’s unclear to me why banks won’t accept it but this creates a real problem for former offenders.

Respondents also lacked an understanding of credit and interest rates. For example, when I asked one respondent why he chose the bank that he chose, he mentioned that the bank was conveniently located and that it had low interest rates. When I probed further, it turned out the low interest rates were on the savings accounts that the bank offered.

Finally, the ways that banks communicate with former offenders can often be a challenge in and of itself. Respondents weren’t always clear about the policies of the bank and were uncomfortable with the ways that bank representatives communicated with them. Compounding this problem is the fact that many former offenders may have been incarcerated for years and during that time our banking system has changed drastically.

What are some of the implications of these findings for programs and policy makers?

From the perspective of the bank, I think they need to be paying more attention to the needs of former offenders. Most banks have a Community Reinvestment Action (CRA) service test and to pass this test they need to be prepared to meet the needs of the communities within their footprint, and that includes the needs of former offenders. Banks should consider offering some sort of non-sales based financial education curriculum, which could benefit the banks and former offenders and would be good for overall reentry policy.

In a broader sense, transitioning out of the criminal justice system and back into the financial world is a key component of helping former offenders have a successful reentry process. We know there is a link between financial knowledge and financial decision making. In order to help former offenders be successful with their own finances it’s critical to start thinking about how we can integrate successful financial education into reentry programs.

What are questions that you feel still need to be answered?

There are three questions that I’m interested in trying to better understand:

  1. We need to identify curriculums and test them in different geographic locations. We tested the curriculum that I created in a large southern state but it’s possible that curriculums will need to be changed and adapted depending on the population.
  2. We need more research to understand how money and financial behaviors are associated with recidivism. In particular, we need to understand the connection between financial strain, knowledge and recidivism.
  3. Finally, we just need better data on the general knowledge and needs of inmates and about how those needs vary at different periods of time in a person’s life.

New Brief Highlights Opportunities for Expanding or Aligning Financial Capability Efforts

By Megan Bolado and Dominique Derbigny on 03/09/2017 @ 09:00 AM

Tags: Financial Capability, News

Click to read "Paving the Way"

At CFED, we spend a lot of time on the road delivering technical assistance and bringing organizations together to help them maximize their impact in their communities. As part of our commitment to sharing knowledge and best practices, it is our pleasure to document the lessons we learn from our deep engagements with the many partners who make the work of boosting financial capability possible. A prime example is the Community Financial Empowerment Learning Partnership, an 18-month project that JPMorgan Chase & Co. generously supported. Today, we’re excited to share “Paving the Way: A Roadmap for Organizations Partnering to Deliver Financial Capability Services,” a brief which documents the phases of the financial capability integration lifecycle—discover, design, implement and converge—as experienced by the members of the Learning Partnership. These lessons provide powerful insights for organizations eager to integrate financial capability services into their existing work or to partner across their communities to help boost clients’ financial well-being.

The Community Financial Empowerment Learning Partnership concluded in September 2016. The Learning Partnership consisted of seven groups of community-based organizations seeking to improve their clients’ financial lives by expanding and aligning financial capability service delivery to more holistically support their communities. Participants in the Learning Partnership included:

  • Catholic Charities of the Diocese of Santa Rosa (Sonoma County, CA)
  • Clarifi, with partners City of Philadelphia and Energy Coordinating Agency
  • Financial Guidance Center (Las Vegas, NV)
  • Massachusetts Community Action Partnership
  • United Way of Miami-Dade, with partners Catalyst Miami, Branches and the City of Miami
  • Wayne Metropolitan Community Action Agency (Detroit, MI)
  • WiNGS, with partners New Friends, New Life and Metrocrest Services (Dallas, TX)

Over the course of the project, important learnings emerged about the process of planning for and delivering financial capability services in partnership with others and “Paving the Way” shares these lessons with the field. These lessons reaffirm for us that integrating services can be an iterative and resource-intensive process for organizations, especially when partnering across organizations and communities. However, applying the lessons and experiences of the organizations in the Learning Partnership may simplify the process and ultimately lead to improved impact on the financial capability of low- and moderate- individuals and families.

Download “Paving the Way” today and browse a range of other financial capability integration resources at

Is Weight Watchers the Answer to Financial Health?

By Steve Wanta, Guest Contributor on 02/16/2017 @ 10:00 AM

Tags: Financial Capability

Change is hard. Whether trying to lose a few pounds or overcoming an addiction, people have been seeking solutions that can make change easier. The struggle to tackle physical and emotional obstacles is part of the human condition. How can these lessons from the world of self-help apply to our financial health?

When starting JUST, we asked ourselves if we could reimagine an organization that was truly based on a community of peers supporting one another to achieve financial freedom. The question led us to explore other, non-financial organizations like Weight Watchers, AA, CrossFit and Entrepreneurs Organization.

From the former CEO of Weight Watchers, David Kirchhoff, “The good thing about peer support is that it works. The bad thing is that no one wants to do it.”

At the beginning of 2016, I joined Weight Watchers to see how this long-standing organization used peer support to help people change and create new habits to reach their weight loss goals. For a month, I would attend weekly meetings, weigh-in and observe how people supported one another in their commitment to change. It was beautiful. It was very different from the thousands of microfinance group meetings around the world I had attended during the course of my career with Whole Planet Foundation.

The top five lessons I took away from my experience with Weight Watchers were:

  1. Start with a new vision of yourself: As Carol Dweck’s research on mindsets has shown, believing you are capable of change is an important first step.
  2. Goals are critical: The framework of goal setting helps create focus and a road map for the hard work of changing habits.
  3. Celebrate the little wins: The journey can be long and hard. Along the way, we need to pause, reflect and acknowledge the progress we have made.
  4. Develop role models: To know someone that has “been there before” is a reassuring example that it is possible. Weight Watchers’ operations depends on these role models.
  5. Everyone is not the same: Some people hate setting goals. Some people care less about the outcome and more about the support. Some are completely uninterested in the meetings and peer support.

JUST has tested many of these lessons around building better money management habits and business critical skills. Most recently, we tapped into the power of peer support for our first savings challenge. Small groups of our clients competed to see who could save the most in one month. The winners saved an average of $268 per person in November.

Ida Rademacher, the Executive Director of the Financial Security Program at the Aspen Institute has framed the idea simply as the ‘couch to 5k’ approach. When we are woefully out of shape, starting is the hardest part. At those moments, an encouraging word or a simple plan can make a big difference. JUST believes a nudge from a person is a powerful tool for changing behaviors.

Although our early results have been positive, we know that we need to design a solution that can have a profound impact at the individual level while serving as many people as possible. The financial health epidemic facing our country is too important to create something that only serves a few. We believe 21st century solutions attempting to reach the hardest to serve must take a human-centered approach that is enabled by technology.

And the answer is yes. I lost five pounds in my month at Weight Watchers. The accountability and sense of togetherness created by the group experience were important elements in sticking with the program. Yet, meetings alone were not enough. The Weight Watchers app gave me the information to make better food decisions. Today there are plenty of apps to help us with our financial lives. Can we build a financial weigh-in, too?

About JUST

JUST is a social enterprise that unites entrepreneurs to create a financial revolution from the inside out. We invest in hard-working, low-income entrepreneurs to realize a more resilient America. We provide capital and coaching through a community of supportive peers. JUST believes lasting solutions to poverty must address both sides of the economic equation, income and savings. To learn more about our work, visit or follow us on Twitter @NewAndJUST.

Symptoms vs. Causes: Individual-Level Interventions Are Not Enough

By Dominique Derbigny on 02/01/2017 @ 09:00 AM

Tags: Financial Capability

I practice social work. Many believe that the social work field is entirely devoted to child welfare, but actually the discipline is deeply rooted in systems change. As social workers, we commit to social justice, equality and alleviation of the oppressed.[1] One of the core tenets of social work is the person-in-the-environment framework, which posits that we cannot understand individual behavior without considering the environmental contexts with which a person interacts. This framework suggests that exploring the larger communities, institutions and systems surrounding clients is critical to developing appropriate interventions at multiple levels.

As part of the Community Financial Empowerment Learning Partnership in 2015 and 2016, I worked with Catholic Charities of the Diocese of Santa Rosa (CCSR) to explore their clients’ financial needs and determine new service delivery offerings that could help improve their financial lives. CCSR decided to offer financial education, financial coaching, incentivized savings programs and free tax preparation for clients in their housing/shelter, immigration and aging programs. Through the implementation process, CCSR realized that while the addition of new financial capability services was helpful, larger structural issues were impacting economic opportunities for their clients (e.g. immigration policies, asset limits on public benefits, lack of affordable housing). Inspired by the 2015 Assets & Opportunity Network Leadership Convening that included a focus on closing the racial wealth gap, CCSR decided to expand their efforts. In August 2016 they hosted a regional convening of 30 asset building leaders to explore Bay Area economic issues at a systems-level and to brainstorm opportunities for change and impact. The result was the formation of the Bay Area Asset Network (BAAN), whose vision is “to generate an inclusive and equitable economy for all individuals and families in the bay area.”

CCSR recognized the shortcomings of focusing explicitly on individual-level interventions, and decided to bridge service delivery with systems and policy change. In the field, we have seen that organizations focused on changing individual behavior may unintentionally blame or shame individuals for their situations. It is true that we all make choices and that choices have consequences, but what if your only choices are between unfortunate circumstances? If you have to choose between grocery shopping or keeping the lights on, taking on additional debt or not fixing your car, living in an affordable neighborhood with failing schools or living in an expensive neighborhood with high performing schools – these choices make it difficult to get ahead. If you are constantly fighting just to make ends meet or stay above water, how do you advance economically? Individual-level interventions may assuage clients’ needs temporarily, but if you only treat the symptom instead of the cause the issue won’t resolve entirely.

We need to step back from focusing on personal situations and identify the larger, interconnected elements of the external environment. This involves digging deeper to understand the root causes of issues. For example, formerly incarcerated individuals face several barriers when re-entering the community – finding employment, housing and social supports to name a few. While it may be important to provide job training and money management tools, such as credit building opportunities, to help facilitate re-entry, it is also necessary to explore the drivers of mass incarceration, employment/hiring practices and housing discrimination. Failing to explore the deeper issues means that individuals will continue to cycle through the criminal justice system, experience discriminatory practices and remain disconnected from opportunities for advancement. While focusing on changes in individual knowledge and behavior can be helpful, multi-level interventions are needed to address underlying conditions and spur long-term change. I invite you to share your approaches to improving systems to advance economic opportunity for people in your communities.

1. Hepworth, D. et al. Direct Social Work Practice: Theory and Skills, Seventh Edition. 2006, Thompson Brooks/Cole.

Now Available: New Resources for Integrating Financial Capability

By Jennifer Medina on 01/11/2017 @ 09:00 AM

Tags: News, Financial Capability

Building the financial capability of low- and moderate-income families is a priority for CFED and our many partners in the field. As part of our commitment to this priority, CFED has provided technical assistance to community-based organizations interested in integrating financial capability services into their existing programs as part of the Family Financial Empowerment Initiative, a two-year project supporting financial capability integration in the northwest. As part of this work, we had the opportunity to produce several resources to support the growing slate of organizations seeing financial capability as critical to improving outcomes. Now, we’re excited to kick off 2017 by sharing these resources—including two videos and six tips sheets—with the field. We encourage you to take a few minutes to explore these new resources and share them with your partners!

Financial Capability Integration in Practice. In this eight-minute video, service providers and nonprofit leaders share their stories about the promise of integrating financial capability into the services they offer, while clients speak to the ways in which financial capability has made a positive difference in their financial lives.

Household Financial Security Framework. CFED recently revamped its Household Financial Security Framework, which we launched last month with a new animated video. The Framework helps illustrate how people must be able to navigate financial systems, learn key skills, earn money, save their earnings, own assets and protect those assets in order to achieve financial security.

Tip Sheets for Practitioners. CFED developed six tip sheets to help practitioners integrate financial capability services into their existing programs. Ranging from tips on how to select a target program for integration to strategies for serving specific populations to ideas for supporting clients from financial instability to stability, these easy-to-use tip sheets are filled with helpful advice from experts in the field.

To browse these and other resources, visit our online hub for Financial Capability Integration at

The Power of Visual Frameworks in Communicating on Financial Capability

By Craig Sandler on 12/09/2016 @ 10:00 AM

Tags: Economic Inclusion, Financial Capability

"How do you talk about financial security in a simple, easily digestible way?" is a question we get asked frequently at CFED. Finding accessible words to explain the complicated relationship money has to our lives can be challenging. Terms like “asset building” and “financial capability” can seem opaque to those outside of the field, and even to some within. Attempts to explain these concepts can too often descend into confusing jargon or overcomplicated explanations of the role of money and our knowledge/ability to handle it.

Many of CFED’s partners and networks, however, have found that using infographics to distill these core concepts into easily-understood visual formats is an effective way to talk about some complicated issues. View the slideshow below in full screen to see several examples of frameworks and explanations of their value. (Note: In order to click on the hyperlinks embedded in the slideshow, you can download the slideshow as a PDF here).

Every community is different and has unique financial capability needs, and different frameworks are more appropriate for some communities than others. What is important is finding a way to communicate the nuances of asset building and financial capability in a way that resonates with your audience. We hope that these examples help to inform your own thinking or inspire you to create a framework that will be most helpful to your partners and the communities you serve.

If you have a financial capability framework that you think would be valuable to your peers, please share it with us at

Explaining the Financial Security Framework with Leigh Tivol

By Ariel Sankar-Bergmann on 12/08/2016 @ 10:00 AM

Tags: Economic Inclusion, Financial Capability

Decades of research—plus our own gut instincts—tell us that boosting financial security is complex. We know that achieving lasting financial well-being is not simply a matter of earning enough, but rather requires a range of factors to come together in a person’s financial life. To help explain these components and how they come together, CFED recently revamped its Household Financial Security Framework, which we launched last month with a new white board animation. The Framework helps illustrate how people must be able to navigate financial systems, learn key skills, earn money, save their earnings, own assets and protect those assets in order to achieve financial security.

To better understand the Framework and how each of its component parts coalesce in people’s financial lives, I sat down with Leigh Tivol, CFED’s Vice President for Strategy & Engagement, to learn more about the development and evolution of the framework.

Ariel Sankar-Bergmann: Tell me a little about why CFED developed the household financial security framework in the first place.

Leigh Tivol: CFED is trying to solve a really complex problem: we are trying to find ways to help people have better financial lives. We know that there are so many different components that make up the daily life of a consumer, and we recognized that the solutions to these problems are equally complex.

The original Household Financial Security Framework helped us to make sense of CFED’s work. As our work evolves, so has the Framework, and it continually helps us make sure that we consider and impact all components of a household’s financial life.

CFED also works with increasingly diverse players. It’s important to have a way for external stakeholders to see their goals, work and interests reflected in the work that CFED does. For example, if I’m a housing provider or a financial coach, I can look at the Framework and see how my work is so critical to people’s financial lives. The Framework helps CFED make the case to partners and potential partners and shows them that we have a clear set of interests in common.

ASB: How has the Framework evolved over the years?

LT: Originally, we conceived of “learn” as a mash-up of financial education, K-12 and higher education. As we moved towards a better understanding of financial capability, it became clear that we needed to separate out the part that is about consumers having the skills, access and safe products to make good financial choices, which now falls under navigate, from educational attainment. Having a high-school diploma and postsecondary education can have a significant impact on financial well-being, and it no longer felt like it was appropriate to combine the two. After all, financial capability requires life-long learning, not just the focus of a two- or four-year degree. We also changed “invest” to “own” because we realized that “invest” was confusing to us and to the organizations in our field. On the flip side, “own” was much more straightforward. So, the Framework is an example of how we as a field can apply what we are learning to create new tools.

ASB: How do you think the Framework can help organizations work better?

LT: I think the Framework can help organizations in three ways. The first is that it helps organizations see where their mission and work can fit into a larger picture of household financial well-being.

The second way is that it can help guide organizations as they think about their own internal gaps and identify opportunities for partnership. For example, if your organization is providing workforce development and helping clients get banked—but it hasn’t addressed the “navigate” component of the Framework—it’s possible that your clients won’t be successful in managing their bank accounts and they may end up back in the check-cashing store down the street. In this scenario, there is an opportunity for the workforce development organization to either partner with an organization that specializes in helping clients navigate financial situations, they could refer clients to that type of organization or they could build the capacity of their own staff so that they can help clients navigate financial systems.

Finally, the Framework is a great tool for conveying the complexity of financial security strategies to policymakers, funders and partners. Going back to the example of workforce development, if I am working with a financial coaching program that is not helping clients access bank accounts, having this Framework makes it easier to bring partners to the table to address this gap in services because they can see the importance of helping households navigate the system.

ASB: Given all that the Framework can do to help organizations see their work, tell me a little about how the Framework informs CFED’s work?

LT: At the highest level, it informs the framing of our strategy. Improving household financial security is a complex problem and we see opportunities all over the place to do great work. But if that work doesn’t fit into the Framework, it’s probably something that another organization is already doing. At a micro-level, it is much more intuitive. The Framework informs how we think about the delivery of information, of products and of services that allow people to get on firmer financial ground.

ASB: Who do you wish would read or use the framework in program development, policy creation or advocacy?

LT: It sure would be nice if every state and federal legislator saw the Framework! On the policy side, there sometimes is a tendency for policymakers to think, “Oh, we passed that one bill, so we’re done.” If a policymaker, legislative body or agency really wants to see low- and moderate-income people get ahead, we need policies that support all aspects of the Framework and that don’t disincentivize behaviors that we hope consumers will engage in.

It would also be great for funders to look at the Framework. Some funders already understand the Framework really well, but I think for others, it would be eye-opening. We cannot achieve a particular financial security outcome unless we address its underlying elements, and we need to think about how we can get resources to organizations so that they can do this.

ASB: Is there an example of how a group or a person might use the Framework?

LT: Actually, I can give an example of a group that currently does use the Framework, and with some success. The Financial Empowerment Network, a Washington State-based organization whose mission is to advance financial empowerment through partnerships which support access to financial coaching, products and resources, used the Framework as the basis for a workshop they developed in 2011. The purpose of the workshop was to help case managers and supervisors learn about resources to help clients improve their financial situation.

The Framework is also part of a resource guide that is designed to help frontline staff understand basic financial empowerment issues and make credible referrals. These are just two of many examples of how other organizations are taking an idea that we started with and really running with it—adapting it to meet their own needs and those of their clients.

To learn more about CFED’s Household Financial Security Framework, watch our new white board animation or download the Framework at our Knowledge Center.

Crossing the Great Divide: Building Assets and Wealth for All

By Andrea Levere on 11/10/2016 @ 09:00 AM

Tags: Racial Wealth Divide, Financial Capability, Economic Inclusion

Editor's Note: This article originally appeared on the Living Cities blog.

“But it’s all right, ‘cause it’s all white…I ain’t talking about rich, I’m talking about wealth.” - Chris Rock, 2004

Sometimes the most vivid truths are spoken by the most unlikely suspects. Since its founding 36 years ago, CFED has pursued a mission to reduce wealth inequality, although we didn’t know it was called that until 25 years ago (what timing!) when Michael Sherraden introduced asset building as the next approach to poverty alleviation in his book, Assets and the Poor. A New American Welfare Policy. While the creation of the social safety net was one of the crowning achievements of the 20th century, the economic changes of our time demand more if we expect to help families stabilize their financial lives and escape the cycle of poverty.

The asset-building approach was grounded in the belief that a household needs knowledge of and access to affordable financial products and services to build the savings and economic cushion that enable upward mobility. Policies that protect consumers in the financial marketplace and encourage savings and investment among low-income households can work in conjunction with traditional antipoverty programs to help families get ahead. The core insight that “it’s not just what you earn, but also what you own” led to our view that the task ahead was to “turn the safety net into a ladder” by building a field of practitioners, crafting policies, engaging private markets, and collecting the data that diagnosed the challenges and delivered evidence of what worked.

CFED’s partnership with Living Cities led to a pivotal report in 2011 titled Building Economic Security in America’s Cities: New Municipal Strategies for Asset Building and Financial Empowerment. This report chronicled the innovative approaches of a growing number of cities in advancing economic security and opportunity through offices of financial empowerment, innovations ranging from access to banking to credit building, and the use of municipal regulation to restrict predatory financial practices. The enduring gift of this report was the design of the Household Financial Security Framework, which illustrated how personal behavior and aspirations, financial structures and systems, public policy and economic trends all interact to create the complex financial lives that we all live and how cities can align services and partners to build financial security in a comprehensive way. Five years later, this framework still guides the work of cities, states and nonprofit organizations.

Another leap came with the creation of the Liquid Asset Poverty metric, which measures the ability of a household to exist at the poverty level for three months if its main source of income is disrupted. Today, 44% or almost half of US households live in liquid asset poverty, with rates much higher in many of our major cities. This number has changed the political conversation; rather than focusing on “those poor people” as a problem, we now understand that more than half of the population faces some level of financial insecurity every day and is part of a broader community seeking solutions.

Yet despite the success of many of our asset-building programs and policies, the current level of income and wealth inequality has increased to levels not seen since the Depression. While Americans of all backgrounds have experienced significant losses of wealth since the recent recession, Americans of color have suffered the most. They are 2.1 times more likely than white households to live below the federal poverty line and 1.7 times more likely than whites to lack the savings needed to weather an unexpected financial crisis. Today, the gap between the average wealth of white households and Black and Latino households exceeds $500,000. A report issued by CFED and the Institute for Policy Studies last month revealed the stunning news that if the average Black and Latino family’s wealth increased at the same rate it has over the past 30 years, it would take Blacks 228 years and Latinos 84 years to generate the same amount of wealth white families have today.

And this sobering reality brings us back to the prophetic words of our favorite comic-turned-economist, Chris Rock. The challenge ahead is to proactively address the racial wealth divide through community-based and policy solutions that reduce this inequality at the national, state and local levels. While much of this inequality is the result of centuries of racist policies, our current tax code expands economic inequality every day through subsidies for homeownership, savings and investments, retirement and higher education that return almost $147,000 annually to the top 0.1% while the average benefit for those making less than $50,000 was barely $150. We need to flip the tax code while we place racial equity at the center of our strategy to revitalize cities and build financial well-being for their residents. I can imagine no organization better prepared to rise to this challenge than Living Cities as it celebrates its 25th anniversary.

Bank of America Fellowship: Measuring Changes in Client Financial Capability and Well-Being

By Hiba Haroon on 11/08/2016 @ 10:00 AM

Tags: Financial Capability, Economic Inclusion

The expansive benefits of financial coaching range from changes in savings and credit to employment retention and greater health. In addition to changes in financial behavior, access to financial coaching has been related to improving individuals’ personal perceptions of their financial situations. More and more, organizations now offer financial coaching to gain a deeper understanding of clients’ financial needs and goals and to provide the necessary tools and resources to increase clients’ financial capability.

As the coaching field grows, so does the need to measure client outcomes and attitude changes to assess its effectiveness.

To help address this need, CFED just launched its 4th Bank of America Fellowship to explore how impact measurement and evaluation systems can be integrated into existing financial coaching programs. The fellowship aims to build the capacity of senior leaders at five organizations, all of which currently provide financial coaching services, to develop monitoring and tracking systems using the CFPB’s Financial Well-Being Scale and Financial Capability Scale to better understand how client outcomes are changing over time.

CFED will provide the five fellows intensive technical assistance on program design and implementation, partnership opportunities and outcomes evaluation through site visits and bi-monthly meetings. CFED will organize and facilitate three virtual convenings and two in-person convenings to provide the fellows opportunities to share lessons and promising practices.

Finally, CFED will work with fellows to integrate Better Money Habits into their coaching services. Better Money Habits is an online financial education curriculum powered by the Bank of America Charitable Foundation. It provides objective and user friendly financial education to empower consumers to be informed and prepared to make financial choices.

We are excited to introduce the fellows selected to engage in this project:

Hopeworks: Dan Rhoton, Executive Director (Camden, NJ)

Hopeworks uses innovative program model teaching homeless and vulnerable youth how to code and build websites while offering individual psychological and emotional support. Hopeworks is training staff how to be financial coaches so that they can offer support to youth during individual counseling sessions.

YWCA Seattle: Matt King, Director of Employment and Regional Services (Seattle, WA)

Born from a commitment to empower women and advance social justice, the YWCA has a rich history and wide array of workforce development programs. YWCA already provides financial education within their job training program and will use that platform to provide financial coaching.

Goodwill Sacramento: Robynne Rose-Haymer, Workforce Development Director (Sacramento, CA)

Goodwill Sacramento was established in 1933. Offering services to thousands of people across are large geographic area, the organization is an important presence in the greater Sacramento community. Goodwill Sacramento has four trained coaches on staff who will continue to find ways to provide coaching services within their workforce related activities.

In addition to these three organizations, two Financial Opportunity Corps sites will participate in the Fellowship:

Baltimore CASH Campaign: Courtney Bettle and Sara Johnson, Program Manager and Director of Financial Security respectively (Baltimore, MD)

The Baltimore CASH Campaign was formed in 2001 to employ strategies to help working families in Baltimore maximize their financial opportunities and resources. Baltimore CASH has a well-developed financial coaching model and is now entering their fourth year as a Points of Light network member.

Accounting Aid Society: Lindsey Vaclav, Manager of Financial Potential Programs (Detroit, MI)

Accounting Aid Society was established in 1972 by accountants who wanted to give back to the community. Accounting Aid Society offers a wide array of services to over 26,000 people in the greater Detroit area. Their services include VITA tax prep, small business financial services, financial education and financial coaching.

Over the next 10 months, we will share updates on members and their progress.

CFED is grateful for Bank of America and their support throughout the fellowship, and we look forward to the progress we will make together!

ALC Provides Launchpad for Latest CSA Findings and Developments

By Diego Quezada on 10/19/2016 @ 10:00 AM

Tags: ALC 2016, Children's Savings Accounts, Education, Financial Capability

The 2016 Assets Learning Conference provided a multitude of opportunities for CSA leaders to connect, share best practices and generate new ideas for moving the field forward. CFED hosted both a CSA pre-conference September 27, which brought together more than 50 experienced CSA practitioners, advocates, funders and policy champions, along with organizing a set of workshop sessions on CSAs at the conference itself.

Benita Melton from the Charles Stewart Mott Foundation kicked off the pre-conference session by noting the number and diversity of programs represented in the room, reflecting the growth and momentum in the field. At the same time, she pointed out that work remains in developing an account platform to help open accounts, improving parental engagement and improving data tracking data of educational outcomes—all of which were discussed throughout the day.

Following a presentation on interim outcome metrics, Frank DeGiovanni, formerly with the Ford Foundation, and William Elliott, with the Center on Assets, Education, and Inclusion, commented that the field has made the evidence-based case that CSAs work by helping families save, and now programs should focus on improvements and understanding what factors help children do better.

The pre-conference session also featured a Shark Tank-inspired session that included three “pitches” from providers of new technology solutions to make provision of CSAs more accessible and efficient. Megan McTiernan of EARN showcased a new online platform that connects directly to savers' individual bank accounts and rewards them based on their saving activity. As part of the demos, Utah Educational Savings Plan and VistaShare’s Outcome Tracker also presented their products, followed by probing questions from the expert panel and audience.

In addition to the robust discussions during the pre-conference, the Assets Learning Conference highlighted CSAs in a variety of ways. At the opening plenary, CFED’s President Andrea Levere challenged the audience to expand CSAs from 29 states to all 50 states. She also urged attendees to join the Campaign for Every Kid’s Future, which works to connect 1.4 million kids to CSAs by 2020. Finally, four workshop sessions at the 2016 ALC focused specifically on children’s savings, providing attendees with tools to design and launch CSA programs, the latest research on CSAs and strategies for how to pitch their programs to different types of funders and elected officials.

One of the highlights of the conference was a session on CSA research. At the session, Trina Shanks of the University of Michigan's School of Social Work reported on recent findings from a quasi-experimental study of CSAs. The so-called Michigan SEED site, which opened CSAs for kids in Head Start more than a decade ago, was part of the multi-year SEED Initiative. Findings from recent interviews with participants emphasized youth voices about CSAs gathered through qualitative data. This series of interviews revealed that financial barriers remain a challenge in the lives of the CSA savers and that communication between the parents and children about the value of CSAs is critical to increasing college aspirations. In addition, research on Kindergarten to College students, presented by William Elliott, found that more disadvantaged students – students in schools with a high percentage of the population on free or reduced lunch – saved at the highest rates, challenging conventional notions about saving.

Overall, the insights and new findings on CSAs shared at the 2016 Assets Learning Conference and pre-conference highlighted the incredible progress across the country over the past several years to expand CSAs and increase the effectiveness of programs.

If you would like to see speaker presentations and handouts from the CSA workshops and concurrent sessions, visit the Assets Learning Conference website.

Portable Benefits Can Offer Stability for Gig Economy Workers

By Diego Quezada on 10/17/2016 @ 01:00 PM

Tags: Economic Inclusion, Financial Capability

Recently, a federal judge rejected a proposed $100 million settlement between Uber Technologies, Inc. and its drivers. The settlement would have afforded Uber drivers at least minimum-wage salaries and reimbursements for expenses and gasoline. This decision reopens a case the Wall Street Journal calls a "pivotal moment for more companies that depend on a pool of freelance workers to drive taxis, clean houses, run errands or perform other menial tasks."

This case underscores the uncertainties “gig economy” workers face – their incomes are inconsistent, and they may not have paid sick leave or an opportunity to enroll in an employer-sponsored health-insurance plan. While 29% of on-demand workers also have full-time employment, several are still missing out on the benefits of traditional employment. These issues are facing more and more Americans. According to economists Lawrence Katz and Alan Krueger, all net employment growth from 2005 to 2015 occurred in alternative work arrangements. The Government Accountability Office notes that as many as 30% of workers have contingent jobs, and a recent Deloitte survey found that 42% of executives plan to use more contingent workers in the next three to five years.

The financial insecurity many contingent workers face, and the likelihood that the gig economy is here to stay and growing, highlight the need for these workers to attain benefits and stability. For gig economy workers who are not able to supplement their incomes from on-demand platforms with full-time jobs, these benefits are even more vital to their financial security.

The idea of portable benefits – workers’ compensation and sick leave that workers can carry from job to job – reflects the need for benefits to keep up with the wide-scale changes in economic activity. Without extending benefits to “gig economy” workers, we would stay on a trajectory of shutting out a growing segment of the working population from the stability benefits provide for millions of Americans.

Many companies already support portable benefits. The U.S. Department of Labor recently announced $100,000 to fund portable benefits research. Additionally, portable benefits has bipartisan support – former John McCain economic adviser Douglas Holtz-Eakin and former Hillary Clinton adviser Anne-Marie Slaughter signed a letter to lawmakers supporting the policy.

The benefits infrastructure forged decades ago does not accommodate the realities workers face in the twenty-first century. Intuit found that the typical income stream of a gig economy worker includes a mixture of on-demand work, a traditional full- or part-time job, consulting and owning a business. Economists have found that paid leave raises the probability that mothers return to employment later and then work more hours and earn higher wages. Benefits are good for business and good for workers. Let’s ensure that all gig economy workers – especially those with low or moderate incomes – have access to the benefits everyone deserves.

Nearly $250,000 Raised in September to Help Low-Income Children Save for College

By Diego Quezada and Monica Copeland on 10/06/2016 @ 09:00 AM

Tags: Children's Savings Accounts, Financial Capability

On September 17 at Rose Bowl Stadium in Pasadena, California, CFED’s Children’s Savings team joined CFED Board member Jamie Kalamarides at Prudential’s second annual 4.01k Race for Retirement. The Race for Retirement is a large public relations campaign designed to raise awareness about the importance of saving for retirement. CFED’s 1:1 Fund was selected to be the cause marketing partner for the race again in 2016, and Prudential donated $200,000 as a result of the race—$15 on behalf of every runner who registered. Since 2015, Prudential has provided $600,000 to support Children’s Savings Account (CSA) programs through the 1:1 Fund, making a meaningful difference in the ability of low-income children across the country to save for college.

Runners head toward the main stage at Prudential’s Race for Retirement in Pasadena, CA

The 1:1 Fund and Prudential understand the impact of regular savings, which lead to big dreams in the long-run for families. As a result of this partnership, Prudential made a $200,000 donation to the 1:1 Fund, which was presented to CFED’s Carl Rist on the main stage at the race.

CFED board member, Jamie Kalamarides, and Carl Rist, Senior Director of Children’s Savings at CFED, accept a check for $200,000 from Prudential Foundation’s Kimberly Ostrowski. Photo credit: Prudential

At the 2016 Race for Retirement, CFED also released a brand new video that outlines the role of the 1:1 Fund in supporting children’s savings programs and features two powerful CSA programs—Boston-based Inversant and San Francisco’s Kindergarten to College.

Children’s Savings team program associate, Diego Quezada, speaks to Race for Retirement participants about the 1:1 Fund.

To cap off a great month of raising incentive funds to for child savers, four CSA programs also participated in the 1:1 Fund’s Back to School campaign, which took place September 12 – 16. Together, these programs raised an additional $40,000 from individual donors across the country, which will be matched by the 1:1 Fund to deepen the impact of these programs. Additionally, two of the four programs—Barry Community Foundation’s Kickstart to Career program and San Francisco’s Kindergarten to College—created short videos to help publicize their Back to School campaigns, which resulted in over 1,000 views on YouTube.

Thanks to the generosity of Prudential and the individual donors who made the Back to School campaign a success, we will help make the college dreams of thousands of low-income children a reality. For more information about the 1:1 Fund and ways to support matched savings for future generations, visit

Official Statement on the Consumer Financial Protection Bureau’s Youth Financial Capability Report

By Kasey Wiedrich on 09/16/2016 @ 03:00 PM

Tags: Data and Research, Education, News, Financial Capability

The Corporation for Enterprise Development (CFED) has been working with the Consumer Financial Protection Bureau (CFPB) and other partners on defining financial well-being and ways to measure it over the past several years. A big question that emerged from that work on financial well-being and its drivers was how do children develop the skills and characteristics that support financial well-being and how can we help children and youth build those attributes? CFED, with the University of Wisconsin-Madison, the University of Maryland, Baltimore County, and ICF International researched these questions through an extensive literature review, a scan of youth financial capability programs, and interviews and discussions with expert academics and practitioners.

Last week, the CFPB released a report on the result of this research, which describes the building blocks of financial capability and the ages at which they begin to emerge.

The building blocks are:

  • Executive function – a set of cognitive processes used to plan, focus attention, remember information, and juggle multiple tasks successfully that begins to develop in early childhood (ages 3-5).
  • Financial habits and norms – the values, standards, routine practices, and rules of thumb used to routinely navigate day-to-day financial life that children begin to acquire during middle childhood (ages 6-12).
  • Financial knowledge and decision-making skills – familiarity with financial facts and concepts, and the ability to do financial research and make conscious and intentional financial choices that come into focus during adolescence and young adulthood (13-21).

These building blocks develop over the course of childhood and they build upon and reinforce each other over time. With these developmental windows of opportunity in mind, the report also lays out a set of strategies to help youth develop financial capability:

  1. For young children, focus on developing executive function skills.
  2. Help parents and caregivers actively shape their child’s financial socialization.
  3. Provide children and youth with opportunities to learn from experience.
  4. Teach youth financial research skills.

These recommended strategies reflect the fact that children and youth don’t learn skills or knowledge in one way or in one setting. Schools and educators play a critical role, but parents and home environments are often the most influential agents of financial socialization as CFED documented in our research earlier this year. And as they age and grow more independent, children and youth are influenced by their peers and their own experiences in their communities. To support these different players in building youth financial capability, the CFPB has produced a number of different resources:

Working with the CFPB on this research has been a valuable experience for CFED, and we are excited about its potential for organizing all of those who care about building youth financial capability around a common set of strategies. If you want to learn more, join us at the ALC in the session, “Setting Children Up for a Lifetime of Financial Well-Being,” where Sunaena Lehil of the CFPB will talk about the report and the CFPB’s work on youth financial capability.

Three Things to do About Integrating Financial Capability

By Joanna Ain, Melissa Grober-Morrow, Kori Hattemer and David Newville on 09/14/2016 @ 12:00 PM

Tags: Financial Capability

Last month, we shared the lessons learned from our three and a half years supporting the Asset Initiative Partnership (AIP), a collaborative effort led by the Office of Community Services (OCS) at the Department of Health and Human Services (HHS). In this role, we worked alongside government agencies and nonprofits across the country as they integrated financial capability services into community health centers, Head Starts, programs that serve Temporary Assistance for Needy Families (TANF) recipients and services for youth transitioning out of foster care.

Financial capability services have helped thousands of clients of social service programs to access the financial products and knowledge necessary to develop the skills to get ahead and improve their financial well-being. The best part is that when this is done right, financial capability services can both support the outcomes of these federal programs and help clients achieve lasting financial stability. For example, research from New York City demonstrated that higher average incomes and more job placements for clients resulted when financial counseling was integrated into workforce development programs. It’s a win-win for everyone.

So how can government agencies make it easier for programs to implement these proven and effective strategies? Based on our work over the past several years, below are recommendations on key steps government agencies can take today:

  • Issue guidance encouraging organizations to use existing funding to deliver financial capability services and provide additional funding to support these efforts. More local programs need to be aware of the availability and impact of these programs, and they need clarity that this is allowable under agency rules. Funding to support both the implementation and planning of these efforts is crucial as well. For instance, with the Workforce Innovation and Opportunity Act (WIOA) signed by President Obama on July 22, 2014, guidance will be provided to include financial capability services in our public workforce development programs for youth.
  • In this guidance, encourage organizations to be innovative in what financial capability services they deliver and how they deliver them. One size does not fit all when it comes to the need and delivery of financial capability services with different programs, localities, and clients. These services need to be selected, tailored, and delivered based on different clients’ financial lives. To do this, federal guidance and support for financial capability integration should not be restrictive. Funding and program rules should encourage organizations to think beyond basic financial education and literacy to broader and more holistic services that help people build financial capability and assets and allow for innovation and flexibility. For example, the Office of Head Start (OHS) included financial security in its Head Start Parent, Family, and Community Engagement Framework, an implementation guide for Head Starts. By making financial security a part of the first “Head Start Parent and Family Engagement Outcome,” the Office is highlighting the value of integrating financial capability services into its intergenerational work alongside showing how to put these services into action.
  • Encourage the use of federal funds to support partnerships with financial capability service providers. Experienced financial capability service providers are key partners in helping social service programs improve the financial capability of their clients. They allow programs to integrate financial capability services into their model without needing to invest heavily in new staff of their own that specialize in these services. Federal agencies can also work together to organize trainings or provide funding to build the capacity of these external partners to provide services to federally-funded programs.

The evidence on the effectiveness of financial capability is so clear that CFED will soon be releasing a federal policy recommendation at our upcoming Assets Learning Conference mandating the integration of financial capability services in all federal social service programs so that all clients and programs can benefit from their impact. This recommendation will be part of broader series of all our major policy recommendations for the new Congress and Administration in 2017.

Stay tuned for more details later this month at the Assets Learning Conference!

Where We’ve Been & Where We’re Going: Our Financial Security at Work Initiative Road Trip

By Joanna Ain on 08/22/2016 @ 02:00 PM

Tags: Economic Inclusion, Financial Capability, Financial Capability Integration

We’ve traveled all around the country this summer as part of our Financial Security at Work Initiative. Through our posts, you became acquainted with young folks who were facing a variety of hardships. We met Julia who is balancing college classes and working nights as a waitress in Portland, Oregon, spoke to Robert in Houston, Texas who can’t always afford food and utilities with his part-time job in a fast-food restaurant and chatted with Ron, who is trying to complete law school in Chicago, Illinois, despite repeated issues related to his personal finances and health. Ranging from 18- to 29-years-old, the workers we interviewed were all employed by at least one employer and had a total household income below 80% of the area median income.

From these and dozens of other interviews with young workers across the country, we are seeking answers to eight questions:

  1. What financial issues are young workers dealing with?
  2. Where do they currently go for help on financial issues?
  3. How do young workers feel about addressing financial issues at work?
  4. What financial wellness services are currently available to young workers?
  5. What financial wellness services are they currently using?
  6. What available services aren’t young workers using? Why?
  7. Which financial services would young workers like to see offered at work in the future?
  8. Are there differences in perspectives between young workers with different characteristics?

With these travel stories from the summer, we hope that we’ve whet your appetite for more! We’re looking forward to sharing our complete findings in our report, due out in early 2017. The report will delve into the above questions and will share more stories from young workers in Portland, Philadelphia, Houston and Chicago.

In the meantime, join us at CFED’s 2016 Assets Learning Conference for our session, “Working It: Creating Financial Wellness Programs That Work for Employees.” Here you will get a sneak peek of the initial findings from our Young Workers Study, as well as a study from the Center for Social Development at Washington University in St. Louis on Employer-Based Financial Wellness Programs. You will also hear from experts in the field on how we can best move financial wellness programs forward.

Thanks for traveling around the U.S. with our Financial Security at Work Initiative team this summer — we’re looking forward to seeing you this fall at the ALC!

CFED’s Financial Security at Work Initiative, sponsored by the Prudential Foundation, explores the current state of workplace-based financial wellness programs and envision how the workplace can be strengthen as a platform for financial security in the future. At CFED, we envision a world where people like Julia, Robert and Ron have the chance to transform their hard work into a strong financial future. To learn more about the project, check out:

Supporting Workers Beyond Wages

By Joanna Ain and Kate Griffin on 08/03/2016 @ 10:00 AM

Tags: Financial Capability, Integrating Financial Capability

As we’ve explored before, many workers are living on the financial edge. Choosing between paying a mortgage and eating or having anxiety over student loan repayment are examples of the struggles that far too many workers experience every day. And it’s spilling over into how we do our work.

In his opening piece for The Pinkerton Papers, Steven L. Dawson, Visiting Fellow at the Pinkerton Foundation and founder and former head of the Paraprofessional Healthcare Institute, makes the case for employers helping their employees move from instability to stability. Dawson cites a 2015 Pew Research study that found that 92% of Americans would rather have financial stability over income mobility. This is a clear signal that workers would prefer the comfort of knowing they have a steady paycheck and good benefits over the possibility of increased wages. A “better jobs strategy,” Dawson asserts, will improve jobs in ways that increase the stability workers are asking for.

At CFED, we’ve been diving into how to make bad jobs better through our Financial Security at Work Initiative. We know that building workers’ financial capability, so that they can stabilize and manage their finances, is an essential feature of a better jobs strategy. With their impressive reach and numerous resources, employers have the ability to make real change in their workers’ lives through financial wellness programs that support employees and help them become more financially secure.

But you might ask, what’s in it for employers? And why should driving their employees towards financial stability be a top priority? The numbers speak volumes:

  • To start with, 44% of households are “liquid asset poor,” meaning they have less than three months of savings to live at the poverty level if they suffer an income loss.
  • This liquid asset poverty naturally leads to financial stress. A 2016 PWC study states that over half of all employees are stressed about their finances. Financial stress is even more prevalent with young folks — 64% of millennials report that they’re stressed about finances.
  • When taking into account other stressors, 45% of employees say that financial matters create the most stress in their lives. This is almost as many as those workers whose top stress is their job, health or relationships combined!
  • So why should employers care? Low assets and financial stress lead to lost time on the job: 46% of workers spend three hours or more at work thinking about or dealing with issues related to personal finances. That’s 150 hours employers lose in productivity per employee every year.
  • We know that employers have long taken steps to help their workers build retirement security. In a SHRM survey, 81% of organizations reported providing retirement planning and consultation. But only 25% of organizations report offering basic budgeting training to their employees.
  • And that is a clear mismatch with what employees need. Even though retirement is the end goal for most employees, only 37% report that it’s their biggest worry. 55% of workers say that their biggest worry is not having enough emergency savings for unexpected expenses. Financial wellness programs are only just starting to catch up and go beyond the 401(k) in the financial security programs they can offer.

How can we better match up the needs and wants of workers to what their employers are offering them? Employers need to listen to their employees. By offering a variety of financial capability services, not just around retirement, employers can help their employees lower their financial stress, both on and off the job.

Dawson highlights a number of investments that employers can make in their staff, including giving them access to financial education and planning services, funding an emergency loan fund, connecting employees to public benefits and tax credits like EITC and helping workers with tuition benefits. These offerings impact a variety of problems that affect workers and help improve their financial well-being.

With access to a more comprehensive set of services, we hope that these workers will be less stressed about their finances in the workplace, more productive employees, and generally, more financially secure. Helping workers reach the point of financial well-being is a win-win for the employees and their employers.

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What Can Mayors Do To Promote VITA?

By Kamolika Das and Holden Weisman on 07/27/2016 @ 10:00 AM

Tags: EITC, Financial Capability, Local Policy

For many middle- and high-income American families, tax refunds are a welcome infusion of cash that augments their regular paychecks—cash that can be put towards a vacation or shopping spree. But for others, especially those making less than the median household income, tax refunds make up a substantial share of their annual resources. Working families often rely on tax refunds to stay afloat and purchase basic household necessities. Accessing free and trustworthy tax preparation services is key for ensuring that families maximize the refund amounts that they rely on and deserve. The Volunteer Income Tax Assistance (VITA) program fills this gap by offering free income tax return preparation to low-wage earners, persons with disabilities, the elderly and limited-English-speaking taxpayers. Demand for the program has surged since 2003, but despite its popularity, millions of people eligible for VITA services are not benefiting from the program.

Mayoral Role in Promoting VITA

Fortunately, mayors and local civic leaders have the ability to help expand VITA services and ensure the program’s success in building financial security for residents. To begin with, mayors and local leaders need to recognize the fact that tax preparation support is necessary throughout the year, not just during tax season. Organizations that provide year-round services are better able to integrate other strategies into their work that contribute to financial capability, such as financial coaching and retirement planning. To enhance tax assistance services for low-income residents, advocates should urge their mayors and civic leaders to take realistic, effective actions throughout the year. Our VITA one-pager highlights some potential actions, such as greater VITA and EITC outreach and developing direct ties with local VITA sites.

Model Cities: Louisville & San Antonio

These recommended actions are both practical and achievable. San Antonio successfully established VITA sites as a hub for financial capability services that often have in-house counselors. The 21 sites are located throughout the city at college campuses, delegate agency sites and libraries. At the 16 library sites, San Antonio’s Department of Human Services worked with library leadership to establish LEARN, an adult education center that provides job search assistance, financial empowerment education and one-on-one counseling. Not only does the City of San Antonio contribute to the sites financially, but the City Council also promotes the programs through public events such as the annual EITC Awareness Day and by sponsoring one of two VITA mobile teams with the local United Way.

Louisville has also been a top-performing city in terms of VITA outreach and the availability of VITA sites. Mayor Greg Fischer has championed the program since taking office, has prioritized VITA funding for those sites that can demonstrate that VITA is integrated into a suite of additional financial capability services. The mayor also hosts local VITA and EITC awareness events during tax season. Former Louisville Mayor Jerry Abramson and a team of community leaders initially established the Louisville Asset Building Coalition (LABC), a collaborative of over sixty organizations, to administer the VITA program and connect clients to other financial resources. The program has grown enormously in the last fifteen years—from filing 635 returns in its first year to 10,000 returns in the 2015 tax season.

Outcomes & Recommendations

These cities’ efforts have been worthwhile. In the 2014 tax season, Louisville’s 27 VITA sites returned $82 million to the community. San Antonio has also made strides in the past year, filing approximately 36,500 tax returns in the last tax season—about 3,000 more than the year prior. San Antonio also established 1,290 mobile teams (an increase of 84 teams from last year), and attracted 6,990 first-time users.

Both cities attribute a large part of their success to the collaborative efforts and partnerships they have established throughout their respective communities. In San Antonio, the Department of Human Services has collaborated closely with IRS, United Way, financial partners in the coalition and volunteers. Partners at LABC relayed that mayors can play a critical role in helping organizations access federal dollars for continued support of VITA and EITC outreach.

VITA has been critical for improving the uptake of EITC and other tax credits. The program has helped low-income taxpayers maximize their tax refunds, avoid unnecessary fees, increase financial stability and improve the accuracy rate of their tax filings. As former Louisville Mayor Jerry Abramson reminded the public, “This is not charity. This is your money. It belongs to you.” It is our hope that more mayors and local leaders throughout the nation will follow San Antonio and Louisville’s lead and do their part to support low-income workers and their communities, and we look forward to supporting cities in these efforts.

What Do Young, Lower-Income Workers Think about Financial Security at Work?

By Pamela Chan and Samuel Weinstock on 06/21/2016 @ 06:00 PM

Tags: Data and Research, Financial Capability, Integrating Financial Capability

It’s been almost a year since we last blogged about our Financial Security at Work Initiative, but we’ve been busy behind the scenes working on the next phase of the project. In our last update, we identified key questions that should shape future conversations about building financial security at work. Following this initial exploration, we’re continuing the conversation with an advisory group of financial wellness providers and also fielding new research that hones in on two of the questions identified: (1) How do financial needs change across the lifecycle, and (2) do workers want financial wellness services to be provided by their employers? Since these are hefty questions that deserve lots of deep exploration, we’re narrowing into a key demographic of particular interest — young, low- and moderate-income workers.

We are interested in learning from this key demographic for a few reasons. First, we know that young adulthood is a formative period in one’s financial life. At this age, people are often entering the workforce and becoming financially independent for the first time. Young adulthood is also a time when financial capability is not well-developed and financial well-being is tenuous. Compared to their older counterparts, young workers have a harder time making ends meet, do not plan ahead as much, are less likely to use formal financial products and are less financially literate. Today’s young workers especially are in need of help, as income and wealth accumulation levels of young people are lagging behind those of previous generations at the same age. Despite these challenges, there is great opportunity in that young adulthood is an excellent time to learn various financial lessons that can help people improve their financial capability and well-being for life.

In particular, we think that opportunities for building financial capability might lie in the workplace. Health and wellness at work is not a new idea — shouldn’t that include financial well-being? Most employees do not currently have access to financial wellness services at their workplace or do not know about them, but it is possible that young workers will appreciate having an avenue for improving financial well-being that is not a financial institution, given the high levels of mistrust among today’s young workers of those companies. Some financial wellness service providers report that their benefits are attractive to young workers and report higher usage of their services compared to older workers. But how would young workers feel about addressing their financial issues at work? What are those financial issues? What help, if any, are they getting now? Would they trust their employer to support their financial capability and wellness? If so, what kind of help do they want?

To answer these questions, we’re going on the road, sitting down with around 50 young, low-income workers to hear about their financial needs and what getting help with those needs in the workplace would mean to them. These interviews will take place in four cities — Houston, TX; Chicago, IL; Portland, OR; and Philadelphia, PA — and include workers with an employer between the ages of 18 and 29. We look forward to sharing what we find at the 2016 Assets Learning Conference (as well as in the full project report that’s coming afterwards). Over the next few months, we’ll periodically share how we’re connecting with these young workers and some of their individual stories on this blog.

So, stay tuned…We’ll see you on the road!

CFED’s Financial Security at Work Initiative, sponsored by the Prudential Foundation, explores the current state of workplace-based financial wellness programs and envision how the workplace can be strengthen as a platform for financial security in the future. To learn more about the project, check out:

It’s Time to Freshen Up the National Financial Literacy Strategy

By Joanna Ain on 05/31/2016 @ 04:00 PM

Tags: Financial Capability, Children’s Savings Accounts, Federal Policy

No matter who you are, you need to freshen up your individual financial plan on a regular basis to check in on your goals, reevaluate your financial needs and consider new financial products and services. It’s just as important to freshen up our national strategy around financial capability regularly with new ideas and relevant trends in the field.

That’s exactly what the Financial Literacy and Education Commission (FLEC) is working to do now. Made up of 22 federal entities and led by the Secretary of the Treasury, FLEC works to strengthen financial capability and lead a national conversation on financial education, capability and well-being through their financial education website,, as well as regular open meetings in Washington DC. The Commission released its national financial literacy strategy in 2011, and now, five years later, it’s time to update this strategy to help better guide work in this field.

CFED took this opportunity to share our comments to help inform the update with our knowledge of this dynamic, fast growing sector. With FLEC’s focus on “Starting Early for Financial Success,” we discussed several exciting advances in the past five years on work directed towards youth and young adults, such as:

The ever-evolving thinking around how to help young people build their financial capability from an early age is critical, and CFED is proud to illuminate our work in this space. Not only were we able to share valuable insights from our work, but it gave us a chance to reflect on how much we’ve learned in the past five years.

While FLEC’s national strategy is freshened up every five years, this is not the only time for the financial capability field to have a voice at this national table. FLEC’s next open meeting is June 29 at the U.S. Department of the Treasury. Register for this next meeting and join CFED, either in person or virtually, to share with and learn from financial capability thinkers in the nonprofit, private and government sectors. Do your part in keeping FLEC up-to-date and relevant with news of your financial capability advances!

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