Opportunity Alliance · orders, check cashing services, payday loans, rent-to-own agreements or...
Transcript of Opportunity Alliance · orders, check cashing services, payday loans, rent-to-own agreements or...
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Opportunity Alliance
Own Your Financial Future
Learn: To participate in the mainstream economy, people need to learn basic financial skills. They can develop these skills through formal education and financial counseling, including policies and programs that integrate savings and financial education into schools and social services.
Earn: To maximize income, people need access to quality jobs, benefits and tax incentives such as the Earned Income Tax Credit.*
Save: To save, households need income left over after meeting basic needs and paying down debt. They can increase savings through affordable and accessible financial products such as Individual Development Accounts and Children’s Savings Accounts.*
Invest: Households invest and grow wealth by leveraging savings through debt financing and public incentives that allow them to purchase a home, make financial investments or start a business.
Protect: Families need access to products, services and policies that protect them against loss of income or assets, extraordinary costs, and harmful, discriminatory, or predatory practices.
Assist: Communities are strengthened when people support their neighbors through strategic volunteerism or donations. Recipients of services will assist others in achieving the objectives above.
May 2014 CONCEPT PAPER
Goals:
Improve access to high quality financial information, education and counseling
Increase access to income-boosting supports and tax credits
Connect residents to safe, affordable financial products and services
Create opportunities to build savings and assets
Integrate effective cross-sector programs and strategies
VISION: The Opportunity Alliance strengthens individuals and families to help them attain and preserve assets, become more financially stable, and achieve long-term economic independence.
MISSION: CREATING AND
SUPPORTING PARTNERSHIPS TO BUILD AND SUSTAIN FINANCIAL INDEPENDENCE AND COMMUNITY CAPACITY.
The Concept:
The Opportunity Alliance will
create and support partnerships to
achieve six key objectives:
*A living wage is the hourly rate that an individual must
earn to support their family, if they are the sole provider
and are working full-time. Nevada’s minimum wage is
$7.55/hr and the same for all individuals, regardless of
how many dependents they may have. Providing a living
wage is essential to Earn and Save. In Nevada an adult
with a child must earn $20.45 for a living wage.
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The Issue at Hand
Family and finances are key sources of
strength and self-sufficiency that interact in
the lives of most Americans. However, many
face ongoing problems and stress because of
family and financial instability. (RTI, 2009)
Washoe County Profile
Asset poverty is a measure of household
security. A household is asset poor if it can’t
support itself at the federal poverty level for
three months in the absence of income. This
means not having enough savings to provide
for basic needs during a sudden job loss or
emergency. A household budget would be so
tight that any unexpected expense like a car
repair or medical bill couldn’t be managed
without incurring debt.
29% of households in Washoe County
live in asset poverty--this includes 38% of
households with children and one in two
households of color
61% of Washoe County consumers don’t
have the credit score to qualify for an
affordable loan
18% (almost one in five) households in
Washoe County have used money
orders, check cashing services, payday
loans, rent-to-own agreements or pawn
shops at least once or twice a year, or a
refund anticipation loans in the past five
years. This is defined as under-banked
(Corporation for Enterprise Development,
2013)
Last year, CFED ranked Nevada worst in the
country for financial security, arguing that
most Silver State residents were living “on the
edge of financial disaster,” with 62.5 percent
of households with less than three months
savings. “Residents in Nevada have been
placed in the position of prioritizing today’s
expenses over the most basis of future goals,”
(Las Vegas Review Journal 1/30/14)
Opportunity Alliance
MAY 2014 CONCEPT PAPER
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FRAMEWORK
MONTH, YEAR VOL # ISSUE #
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OPPORTUNITY ALLIANCE
CFED created the Household Financial Security Framework to illustrate – from a household’s perspective what it really takes to build financial security over time.
LEARN
Knowledge and skills that enable navigation of and success in markets (labor, financial) have a direct bearing on financial security
K-12 & Postsecondary Education: Basic Literacy and math skills, plus commitment to lifelong learning are
critical for employment and advancement
Financial Education & Counseling: Timely, relevant, accurate information on basic budgeting, taxes, financial
products and services, and use of credit
Asset-specific Education: Preparation for homeownership, business ownership, postsecondary education, and
financial investments
EARN
Wage + Business Income
+ Public & Employee Benefits
+ Tax Credits
+ Investment Income
= Income
Ability to Maximize Income
Depends On: Access to reliable basic goods
and services (housing,
transportation, medical care, child
care, food)
Available quality job and
business opportunities
Access to public benefits and tax
credits (e.g., EITC, Child Care)
Assets Ownership (higher
education, home, business,
financial investments)
Knowledge and skills related to
work, taxes, and benefits
SAVE
Income
- Current Consumption
- Debt Payments
= Savings
Ability to Save Depends On:
Access to affordable basic goods
and services (housing, transportation, medical care, child
care, food)
Debt reduction
Convenient, low-cost financial
products (transaction and savings
vehicles, credit and insurance
products)
Convenient, affordable financial
structures (e.g., direct deposit,
automatic enrollment, online banking, bank location)
Knowledge and skills related to money management, financial
products, and credit building and
repair)
INVEST
Savings
+ Borrowing
+ Public Incentives
= Assets
Ability to Build Assets
Depends On: Price and appreciation of
assets (higher education, home, business, financial
investments)
Affordable financing
Access to public incentives
(e.g., downpayment assistance, government loan
guarantees, tax incentives,
Pell Grants, IDA/CSA match)
Knowledge and skills related
to asset purchase and management
PROTECT
Gains must be protected against loss of income or assets, extraordinary costs, and harmful or predatory external forces
Insurance (public or private): protects against loss of income or assets as well as against extraordinary costs (e.g., unemployment, disability, life, health/medical, property)
Consumer Protections: Protect consumers from discriminatory, deceptive and/or predatory practices (e.g., redlining,
predatory, mortgage lending, payday lending, banking practices)
Asset preservations: Depends on government policies (e.g., community investments, blight ordinances, foreclosure
prevention) and market conditions
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Assets can increase income and earning capacity
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OA General Membersip
Programming
Committee
Youth
Economy and Jobs
Education
Policy and Advocacy
Communications and Public Engagement
Fund Development
OA Steering Committee
Fiscal Agent
Coordinator
MAY 2014 CONCEPT PAPER
OPPORTUNITY ALLIANCE
Goal: Improve access to high quality financial information, education and counseling Strategies • Create financial education and counseling networks and referral structures. • Incorporate financial education into social service and workforce programs.
• Standardize and certify financial education services and providers. Goal: Increase access to income-boosting supports and tax credits Strategies • Promote ways to leverage technology to streamline public benefits screening and
uptake.
• Support access points for benefits screening in high-need communities. • Support VITA and EITC public awareness campaigns and free tax prep services.
Goal: Connect residents to safe, affordable financial products and services Strategies • Increase access to affordable transaction, saving, and credit products through
programs with mainstream financial institutions. • Identify alternative, affordable credit products, e.g., small dollar, refund anticipation
(RALs) or auto refinance loans.
• Encourage employers to use direct deposit. Goal: Create opportunities to build savings and assets Strategies • Promote the protection of consumers from high-cost alternative financial service
providers. • Advocate to preserve and create affordable housing options. Goal: Integrate effective cross-sector programs and strategies
Strategies • Identify and promote effective programs. • Convene partnerships to increase awareness. • Help secure resources to support implementation.