Ownership & Assets

Children's Savings: How Far We've Come

June 18, 2014
Children's Savings Accounts have received a great deal of attention in 2014. The incoming Chairman of the Finance Committee, Senator Ron Wyden (D-OR), made a splash when he highlighted CSAs as one of his top priorities upon taking the gavel.

Children's Savings Accounts

  • By
  • Reid Cramer,
  • Rachel Black,
  • Justin King,
  • New America Foundation
June 18, 2014
The American Dream is built upon the enduring values of equal opportunity and personal responsibility. Ensuring that this dream remains attainable depends upon America being able to promote these values among rising generations. Research and experience in the field consistently supports the thesis that children's savings accounts (CSAs) can provide a vehicle to support these objectives.

Asset Building News Week, June 9-13

June 13, 2014
Publication Image The Asset Building News Week is a weekly Friday feature on The Ladder, the Asset Building Program blog, designed to help readers keep up with news and developments in the asset building field. This week's topics include education, income, wealth, and housing issues.

Bringing College Savings Within Reach?

June 13, 2014
Publication Image Saving is hard. We know that all too well. It's one of the reasons that only about 3 percent of American families use tax-advantaged savings accounts (529s and Coverdells) to save for college. Saving is even harder when you're told you have to choose between putting food on the table and putting some money away for your child's college education.

Guest Post: Senate Housing Bill Expands Reach of Self-Sufficiency Program

June 10, 2014

Editor's note: This piece was authored by Barbara Sard, Vice President for Housing Policy at the Center on Budget and Policy Priorities. It originally appeared on CBPP's blog, Off the Charts. Click here to learn more about the Family Self-Sufficiency Program. 

We’ve noted several areas where the Senate Appropriations Committee-approved bill to fund the Departments of Transportation and Housing and Urban Development (HUD) improves on its House counterpart.  Here’s another:  the Senate bill would enable more families with housing assistance to participate in HUD’s effective but underutilized Family Self-Sufficiency (FSS) program; the House bill wouldn’t.

Under FSS, created in 1990 based on a proposal by the first Bush Administration, participants sign a contract with the public housing agency detailing their plans to acquire educational or vocational training and their interim or longer-term goals, such as getting a job or a higher salary or starting a business.  To complete the program (which generally takes five years), the head of the household must be employed and, if the family receives welfare benefits, each family member must become independent of those benefits and remain so for 12 months.

Asset Building News Week, June 2-6

June 6, 2014
Publication Image The Asset Building News Week is a weekly Friday feature on The Ladder, the Asset Building Program blog, designed to help readers keep up with news and developments in the asset building field. This week's topics include poverty, employment, and retirement.

Using Concepts from the Field of Cognitive Science to Improve Self-Sufficiency Programs

June 4, 2014
Publication Image Maya Brennan with the Center for Housing Policy has published a fascinating new report entitled “Strengthening Economic Self-Sufficiency Programs: How Housing Authorities Can Use Behavioral and Cognitive Science to Improve Programs.” Brennan uses concepts from the fields of behavioral and cognitive science to evaluate strategies public housing authorities (PHAs) and other providers of housing assistance can utilize to better support their low-income participants. This work has the potential to improve the efficacy of programs designed to support increased earnings and broader upward mobility for recipients of housing assistance.
Research from the field of cognitive science helps explain the ways that experiences with “frequent or extended episodes of poverty, trauma, and social bias” affect the decision-making, long-term planning, and other abilities of families receiving rental assistance. Incorporating an awareness of this dynamic into program design at the PHA level therefore can help families participating in programs accomplish their goals and achieve self-sufficiency.
Specifically, the Family Self-Sufficiency (FSS) Program is well-situated to tackle these issues because it has design elements that already reflect an understanding of what kind of support is needed to help families get on track.

Obama's myRA Proposal Needs Flexibility

June 3, 2014
Editor's note: The following is an excerpt from an article published in The Hill on June 3, 2014. To read the full article, please click here.

In this year's State of the Union, President Obama announced his intention to create a new type of savings vehicle for workers who lack coverage through their employers — the myRA or "my Retirement Account." The motivation for the effort was easy enough to see. Changes to the retirement savings landscape over the last 30 years have left far too many workers financially underprepared for their golden years. Pensions have virtually disappeared, and the 401(k)-type plans that were intended to replace them have shifted risk and costs onto individual workers. Today, only about half the workforce is even participating in a plan, let alone saving enough. The reality is that with such poor coverage and low contributions, the transition to a 401(k)-dominated retirement system has become a failed social experiment, one that is exacerbating economic inequalities.

Asset Building News Week, May 26-30

May 30, 2014
Publication Image The Asset Building News Week is a weekly Friday feature on The Ladder, the Asset Building Program blog, designed to help readers keep up with news and developments in the asset building field. This week's topics include the case for reparations, savings, and education.

Should We Save Like the Singaporeans Do?

May 29, 2014
Editor's note: This piece originally appeared on New America's Weekly Wonk as part of the series, Globalization’s Canary: Singapore at 50.  In the half-century since its independence, the strategically located city-state has leveraged its access to the global economy, and a number of innovative policies on issues ranging from housing to savings and social cohesion, to become one of the world’s most affluent societies.  As they prepare to celebrate their milestone, Singaporeans are in a reflective mood, taking stock of what’s been accomplished, while also expressing some unease about the sustainability of their current model going forward.  In that same spirit, New America Asset Building Program Director Reid Cramer explores whether Singapore’s innovative savings system could work in the United States.
In recent years, policymakers around the world have begun exploring the potential of asset-based welfare policy. There is a growing recognition that while income facilitates immediate consumption, people move up the economic ladder and become economically secure when they are able to build up a pool of assets that they can deploy productively. The experience of Singapore and their Central Provident Fund (CPF) provides an instructive case study for the potential of this approach. Although it was initially designed as a mandatory savings scheme to facilitate retirement security while minimizing welfare payments, it has evolved into a comprehensive social security savings plan with various pre-retirement uses such as financing healthcare, child development, post-secondary education, home ownership, and asset building.

As an account-based social policy system, the CPF offers instructive lessons for any country, particularly when we begin to break down why it has worked so well. One feature that makes it particularly effective is that everybody is automatically enrolled – so taking initiative or having special knowledge of investments and savings isn’t required. Contributions to the fund are not optional, but the resources that accrue can eventually be accessed by the account holder. And there are incentives to increase participation among those with lower incomes, introducing a degree of progressivity to the program.
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