Individual Wealth Building

Rocky Mountain MicroFinance Institute

Founded in 2008, the Rocky Mountain MicroFinance Institute (RMMFI) fosters entrepreneurship as a way to create economic and social mobility.  To do so, RMMFI provides skill-building, mentorship, and small loans to low and moderate income entrepreneurs. Its Business Launch Boot Camp is credited with graduating entrepreneurs who currently own and operate 31 area businesses.

Rocky Mountain Employee Ownership Center

Based in Denver, the Rocky Mountain Employee Ownership Center (RMEOC) strives to nurture an economic system characterized by inclusion by advocating for and providing pathways to employee ownership.  To do so, RMEOC offers consultation services to business owners interested in transitioning to employee ownership and promotes employee ownership across the region by advancing legislation and fostering a range of educational events and efforts.

Mi Casa

Operating since 1976, Mi Casa focuses on fostering the economic success of Denver’s Latino and working families.  Through its Mi Casa Women’s Business Center, the nonprofit offers entrepreneurial training, business counseling, technology training, and networking opportunities to support entrepreneurs and emerging businesses.  In 2015, Mi Casa served 2,724 people and helped launch 82 new businesses.  To diversify and expand its revenue base, Mi Casa also operates two social enterprises, Mi Casa BackOffice Solutions, which provides nonprofits and small businesses with accounting and bookkeeping services, and Mi Casa TalentSolutions, which is a staffing agency specializing in bilingual talent.

Equitable Investments in the Next Generation: Designing Policies to Close the Racial Wealth Gap

Laura Sullivan, Tatjana Meschede, Thomas Shapiro, Dedrick Asante-Muhammed and Emanuel Nieves

Median Latino and Black households have over $100,000 less in wealth than median White households, a disparity that persists despite reductions in income inequality. This new report from the Institute on Assets and Social Policy and CFED puts forward a “racial wealth audit” framework, assessing how specific policies either lessen or inadvertently perpetuate the racial wealth gap. The authors call for “targeted universalism” noting that policies such as Children’s Savings Account and eliminating student debt will only successfully address the racial wealth gap if they focus in particular on low income households.

Elmseed Enterprise Fund

Aiming to catalyze successful small business development in New Haven, Elmseed Enterprise Fund provides entrepreneurs with small, low-interest loans and technical assistance.  Since its establishment in 2001, Elmseed has disbursed more than 30 loans totaling over $70,000.

Strengthening VITA to Boost Financial Security at Tax Time & Beyond

Shervan Sebastian, Ezra Levin and David Newville

In 2015, Congress increased funding for VITAfor the first time in six yearsby $3 million. However, in order for the program to meet the growing demand for its services, VITA must be authorized, expanded and modernized. This paper explores how the VITA program has developed over time and how local VITA programs serve their communities. It then highlights the VITA program’s present challenges and opportunities for valuable reforms that would enable VITA sites to serve more people. 

Sector Workforce Intermediaries: Next Generation Employer-Engagement Strategies

Fred O'Regan

The Annie E. Casey Foundation and the Aspen Institute invited a number of leading practitioners to a one-day meeting centered on the question: “How can we expand the definition of employer engagement to include influencing businesses’ human resource and training practices in addition to responding to pipeline needs?” The question was meant to be provocative and to elicit lively discussion, not necessarily neat conclusions. 

Moving Toward a Policy Agenda for Improving Children’s Savings Account Delivery Systems

William Elliott III, Melinda K. Lewis, Anthony Poore and Brian Clarke

This paper, jointly produced by the Center on Assets, Education, and Inclusion (AEDI) at the University of Kansas and the Federal Reserve Bank of Boston, was informed by a roundtable on CSA delivery systems, held at the Boston Fed in December 2014. It describes the design, key features, and respective challenges of each principal delivery system. Assessed in light of the CSA field’s guiding principles for delivery system design (universal and automatic enrollment, national footprint, cultivation of a saver identity, asset-building, administrative efficiency, and adequate consumer protection), these models have distinct advantages and limitations. This paper attempts to contribute to the critical task of building the knowledge base needed to help children’s savings programs begin to weigh the pros and cons of each of these existing delivery systems. 

Transforming U.S. Workforce Development Policies for the 21st Century

Carl Van Horn, Tammy Edwards and Todd Greene

More comprehensive restructuring and truly innovative approaches are needed to meet the human capital demands of employers. More and better information is also needed to inform job seekers about an increasing range of private and public options from which they can obtain the skills and credentials to be successful. It is in response to these and other trends that Transforming U.S. Workforce Development Policies for the 21st Century was developed. The book provides thoughtful perspectives on how workforce development efforts, often based on approaches from decades ago, might be rethought to better respond to these trends. 

Saving 10x for Education: The Impact of EARN’s Triple Boost Microsavings Program on Families’ Education Savings

Jade Shipman

EARN is a leading nonprofit provider of microsavings programs in the US. EARN commissioned a Randomized Controlled Trial (RCT) to measure the impacts of TripleBoost, a program designed to help working families save for their children’s education. The primary goal of the RCT was to understand how the first 6 months of TripleBoost participation influences the amount of money that families save for their children’s education.

To answer this question, the study randomly placed qualified TripleBoost applicants into Treatment and Control groups, where the Treatment group immediately began participation in TripleBoost, and the Control group was placed on a 6month waiting list. Families were asked a series of questions at the time of application and on a 6month followup survey. Actual deposit data from families in the Treatment group also was analyzed.

RCT findings reveal that during the 6month study period, TripleBoost families saved an average of $681 for their children’s education, more than 10 times the average amount saved by families in the Control group. A majority of families in the Control group saved $0 during the study period, while 90% of TripleBoost families saved $500 or more. The results are statistically significant. Thus, EARN’s TripleBoost program effectively drives families to set aside 10x more in savings for their children’s education than they would save without the program. 

Federal EITC Kept 2 Percent of the Population Out of Poverty: Greatest Poverty Reductions in Texas, North Carolina, and Arizona

Douglas J. Gagnon, Marybeth J. Mattingly and Andrew Schaefer
University of New Hampshire

This brief documents the proportion of Americans who would have been poor absent the Earned Income Tax Credit (EITC), all else being equal, across 2010–2014. We examine Supplemental Poverty Measure (SPM) rates as well as hypothetical increases in the rates of SPM poverty in the absence of federal EITC benefits. It is important to note that we do not model behavioral changes that might result from the removal of EITC benefits, so the analyses presented here are a simplified representation of such a hypothetical scenario. The SPM is an obvious choice for this analysis because unlike the Official Poverty Measure (OPM), which only accounts for before-tax cash income, the SPM also considers in-kind benefits, tax credits, and out-of-pocket work and medical expenses when estimating resources. We present SPM rates for all individuals as well as for children only, analyzing trends across regions, metropolitan status, and by state. Importantly, geographic differences in the cost of housing are accounted for in the SPM rates, and consequently the analyses presented here give a more accurate sense of the poverty reducing impact of EITC benefits. 

Family Financial Resources among Boston Residents: Flow by Race and Ethnicity

Tatjana Meschede, William Darity Jr. and Darrick Hamilton

This issue brief examines the extent to which family financial transfers occur among Boston residents of color. New data collected for the Boston metro area, as part of the National Asset Scorecard for Communities of Color (NASCC) survey, for the first time provide detailed information on financial assets that allow analysis to be broken down beyond the traditional black-and-white divide at the metropolitan-area level. Targeting U.S.-born blacks, Caribbean blacks, Cape Verdeans, Puerto Ricans, and Dominicans, findings show that households of color consistently receive fewer financial transfers than whites, while at the same time providing more financial assistance to their families and relatives. Particularly striking are differences in parental payments toward higher education expenses and financial support for the down payment of a home. Immigrant status further explains differences between white and nonwhite households as well as between households of color. 

Building Millenials' Financial Health Via Financial Capability

Terri Friedline and Stacia West

This study, generously funded by the FINRA Investor Education Foundation, leveraged the 2012 National Financial Capability Study (NFCS) to investigate the state of Millennials' financial health and to provide a preliminary test of the effectiveness of financial capability—an intervention that has the potential to improve financial health by combining financial education and financial inclusion. In particular, this study asked whether being financially capable was associated with metrics of Millennials' financial health such as locating $2,000 for an unexpected expense, saving for emergencies, using alternative financial services, carrying too much debt, and being satisfied with their financial condition. In addition to joining the national dialogue regarding the state of Millennials’ financial health within the current macroeconomic context, this study offers financial capability as a potential solution. 

Poverty Interrupted: Applying Behavioral Science to the Context of Chronic Scarcity

Allison Daminger, Jonathan Hayes, Anthony Barrows and Josh Wright

Ideas42 has engaged with more than 70 domestic poverty experts over the past year, including academics, practitioners, and parents raising young children. We have studied academic liter- ature from multiple disciplines and directly observed 15 programs serving families with low incomes. This paper distills the lessons we’ve learned and the best practices we've observed in this process. We do not claim exhaustive knowledge of poverty; instead, we intend this document to serve as a well-researched conversation starter that will help catalyze the behav- ioral innovations our society desperately needs. In the pages that follow, we share behavioral insights that shed new light on the many challenges facing families with low incomes and those who seek to support them. We also put forward three design principles that follow from these insights and can be tailored to t the needs of a wide range of communities, organizations, policies and programs. 

Northside Economic Opportunity Network (NEON)

Established in 2006, Northside Economic Opportunity Network (NEON) strives to broaden economic development opportunities and build wealth for low- to moderate-income entrepreneurs in north Minneapolis.  To do so, the nonprofit provides business training, technical assistance, small business financing, and affordable co-working office space.  It is credited with supporting over 1,000 entrepreneurs and helping to establish or grow 60 area businesses.

Eastside Financial Center

Eastside Financial Center provides integrated financial and employment services to help families and individuals create and build financial assets that improve their financial wellbeing.  Key services include financial coaching, employment coaching, screening for public benefits, job-seeker and money management workshops, banking products, and free tax clinics.  The nonprofit has also launched innovative matched savings account programs in partnership with other local nonprofits, including the Hmong American Farmers Association (HAFA).

Asian Economic Development Association

Established in 2006, the Asian Economic Development Association (AEDA) strives to increase economic opportunities in the Twin Cities for Asian Americans.  To do so, the nonprofit provides small business development services, financial education, access to credit, and creative place-making services.  Aiming to build racial equity and ensure the inclusion of low-income Asian Minnesotans, AEDA also engages in advocacy and policy work.

The Ever-Growing Gap: Without change, African-American and Latino families won't match White wealth for centuries

Dedrick Asante-Muhammed, Chuck Collins, Josh Hoxie and Emanuel Nieves

Between 1983 and 2013, the average wealth of white American families grew by 84 percent—three times and 1.2 times the growth experienced by African American and Hispanic American families respectively. The Institute for Policy Studies (IPS) and CFED examine this and other racial wealth gap trends in their new report, and offer policy solutions to reduce wealth inequalities which include: conducting a government-wide audit to examine the ways in which current federal policies perpetuate racial wealth inequality, creating universal children’s savings accounts, and exploring progressive taxes such as a wealth tax.

Baltimore CASH Campaign

Established in 2001, Baltimore CASH Campaign is a collaborative effort among Baltimore foundations, nonprofits, workforce development agencies, City government, the Internal Revenue Service, and hundreds of volunteers to help Baltimore’s working families maximize their financial opportunities and resources.  To do so, the Campaign champions the Earned Income Tax Credit (EITC) and other tax credits for low-income workers; provides free income tax assistance; connects people to asset building resources, including financial education classes, one-on-one financial coaching, and mainstream banking opportunities; and advocates for issues impacting working families.  Since 2001, the Campaign is credited with helping city residents claim over $80 million in total federal refunds and over $40 million from the EITC.