b&b125 Solutions for closing the racial wealth gap – Part 2 of our Assets Learning Conference report
In part 2 of our coverage of the CFED’s Assets Learning conference, we talk about some of the solutions that are in motion or being proposed by the CFED to make strides on closing the racial wealth gap, from savings programs, college savings, homeownership, tax law changes, retirement programs, etc.
Take a listen and see if there are any programs that would make sense for you to look into and take advantage of.
Pam: One of the best and most sure ways to build wealth is to own something, whether it’s property, whether it’s a business, whether it’s stock.
Pam: This is probably one of the craziest stats that I’ve heard at the conference: studies have shown that children who have some kind of college savings, including a Children’s Saving Account, of $500 or less are 4x more likely to graduate than children with no college savings at all.
Pam: Homeownership still, even after the recession, is the #1 way for a middle income family to build wealth.
Pam: One of the days, they actually spent the entire afternoon, they organized a 500 person trip to capitol hill. They organized 175 meetings with congressmen from across the country, and they sent direct service providers from the state to go lobby on capitol hill for three specific issues: the first one is the assets for independent funding. The senate wants to cut it. The house wants to keep it. The assets for independent funding is actually the main source of income for individual development accounts, or IDAs as they’re known, in the nonprofit world, and basically they provide matching programs for families for saving and growing their assets. So, these are the kinds of programs like the child savings accounts which help you save for college, the matching programs for tax refunds and things like that. These individual development accounts are basically incentivizing lower income families and moderate income families to save, and then for every dollar they save they get matched that dollar.
Dyalekt: It’s basically the opposite of these predatory wealth stripping lending practices.
Dyalekt: There is a ton of research that shows that helping people save, like giving them an influx of a little bit more money in the beginning, makes it way easier for it to become a habit. …Just having that little safety cushion. I mean, that’s why folks are able to do the things they do. Whenever you’re in so many of these conferences people are like “Oh, I just took a risk ‘cause I had to.” This is how you put yourself in a position to take a risk. Take advantage of opportunity.
Pam: Yup. And savings gives you the ability to do that.