Financial Capability at the CFPB

Daniel Dodd-Ramirez, Assistant Director, Office of Financial Empowerment

September 18, 2014

DISCLAIMER

This presentation is being made by a Consumer Financial Protection

Bureau representative on behalf of the Bureau. It does not constitute

legal interpretation, guidance or advice of the Consumer Financial

Protection Bureau. Any opinions or views stated by the presenter are

the presenter’s own and may not represent the Bureau’s views.

This document was used in support of a live discussion. As such, it

does not necessarily express the entirety of that discussion nor the

relative emphasis of topics therein.

Definition of Financial Capability

Financial capability is the capacity, based on knowledge, skills and access, to manage financial resources effectively.

CFPB Vision

A consumer finance marketplace…

where customers can see prices and risks up front and where they can easily make product comparisons;

in which no one can build a business model around unfair, deceptive, or abusive practices;

that works for American consumers, responsible providers, and the economy as a whole.

CFPB Mission

The mission of the Consumer Financial Protection Bureau is to make markets for consumer financial products and services work for consumers by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives.

CFPB Divisions

Consumer Education & Engagement

Consumer Response

Research, Markets & Regulations

Supervision, Enforcement, & Fair Lending

External Affairs

Legal Division

Servicemembers

• Improve financial protection

• Monitor Service members complaints

• Coordinate w/ DoD, etc.

• 2.2 million military personnel

• 22 million veterans

Older Americans

• Protect against financial abuse

• Improve financial literacy

• Planning for life events

• 50 million aged 62+

Students

• Increase awareness of debt when selecting a college

• Monitor students complaints

• Build campus awareness

• 22-28 million (age 16-26)

Financial

Empowerment

• Improve financial stability for 100 million low-income and economically vulnerable consumers

• 68 million unbanked or underbanked

• 33% of Americans earn 2x the federal poverty level or less

• Approximately 50 million have thin or no credit files

Consumer Education and Engagement

Financial Education Provide educational content and identify and promote effective practices

Consumer Engagement Create interactive and informative relationships with consumers

Office of Financial Empowerment

• Special focus on low-income and economically vulnerable consumers

– 100 million

• Collaborate with federal agencies and other intermediaries that touch

low-income and economically vulnerable, e.g., HHS, DOL, social

service agencies, community organizations, legal aid entities

• Identify and promote effective products and policies that assist

population

• Develop and promote scalable tools and approaches that:

• improve the safety and lower the costs of basic financial transactions

• make it easier for consumers to save

• help consumers borrow safely and appropriately, while lessening the burden of high-cost debt

Consumer Protection

Access Managing

Money

Credit

Savings

Low-income

and

Economically Vulnerable

• Improve the Financial Marketplace • Build Financial Capability

We work to:

Office of Financial Empowerment

Mobile what?

10

$

E-wallets

Charge purchases to phone bill

Manage money – PFM apps

Link to bank account

Prepaid card via mobile

Link to third party payor Scan at

Point-of-Sale

Office of Financial Empowerment

Strategies Goals Initiatives

Tools

Access to actionable financial information, capability, and counseling tools

• Your Money, Your Goals

• Financial Coaching

Collaboration

Integrate and scale financial empowerment strategies into programs and policies of federal agencies

• Dep’t of Labor - People with Disabilities

• HHS – Summer Youth

Products and Policies

Identify, analyze and report on most promising products, services and policies

• Tax-Time Savings

• Financial Outcome Measures

• Credit builder loan evaluation

Your Money, Your Goals

• Toolkit with financial education modules and tools geared to needs of underserved population

• Training social services workers, legal aid staff and others who work directly with low income and economically vulnerable consumers

• Scalable – within first 2 years, aim to reach more than >5,000 front line staff and >30,000 consumers

• National perspective, local context – help to identify financial need and link consumers to local resources

• Customizable – address unique needs of intermediaries; user-friendly with plain language text

• Preview Module Online - Managing Debt consumerfinance.gov/your-money-your-goals/

Topics include: • Goals • Saving • Income and spending • Cash flow budgeting • Debt • Credit • Financial services • Consumer protection Customizations and adaptations • Legal Aid • Community Volunteers • Workers Available for download in English and Spanish at consumerfinance.gov

Your Money, Your Goals

Your Money, Your Goals Partner Map

Field tested with 1,400 case managers and with 30+ CCUSA sites

Federal Partnerships

Summer Youth Employment – FLEC, HHS, DOL, others

Bridges to Financial Security – DOL, National Disability Institute

Office of Disability Employment Policy – ODEP

Your Money, Your Goals – HHS, U.S. Department of Agriculture

Working with HHS

CFPB Tools and Resources for Consumers

Tell Your Story:

http://help.consumerfinance.gov/ap

p/tellyourstory

Complaints:

http://www.consumerfinance.gov/co

mplaint/

Ask CFPB:

http://www.consumerfinance.gov/as

kcfpb/

Your Money, Your Goals:

http://www.consumerfinance.gov/yo

ur-money-your-goals/

CFPB Tools and Resources for Consumers

CFPB Twitter: @CFPB

CFPB Facebook:

http://www.facebook.com/CFPB

CFPB Blog:

http://www.consumerfinance.go

v/blog/

Publications:

http://promotions.usa.gov/cfpbp

ubs.html

empowerment@cfpb.gov

Contact the Office of Financial Empowerment at