Increasingly, community groups are organizing at the state level to build broad-based efforts to support wealth building by low-income families. While each initiative is unique, they all share the common goal of enabling lower-income families to build wealth and rely on strategies such as financial education; policy development to encourage savings for education, homeownership, small business development, and retirement; access to insurance; regulations to limit predatory lending; and access to tax-based savings for lower-income families.
HistoryCalifornia was one of the first states to adopt a long-term policy agenda focused on asset building. Initiating this effort was the San Francisco-based nonprofit Earned Assets Resource Network (EARN), which created the Asset Policy Initiative of California (APIC) in 2003 to advance policies designed to help low- and moderate-income families save, invest, and preserve their assets.
State asset policy initiatives come out of the realization that the model of government subsidy for savings and investment, which has benefited upper-middle class and wealthy Americans, might, with some modifications, be made to work for lower-income Americans. While numerous states and localities have supported aspects of community wealth building for decades, it is only within the last few years that this has become an explicit policy goal.
State asset building initiatives play a critical role in building community wealth for several key reasons:
- They help community residents develop their own, long-term income-generating capacity.
- They promote homeownership and small, local business development—critical elements of vibrant, sustainable neighborhoods.
- They can help safeguard people against unexpected challenges and ensure their financial well-being into the future.
- They can provide people with additional income, which encourages greater savings and helps inject more dollars into local economies.
Community-wealth.org houses an extensive collection of resources focused on State Asset Building and this strategy’s role in community wealth building. Below is a glimpse of the rich array of materials you will find as you explore our site:
Our Support Organizations section features major organizations that are working to advance state asset building. One such group is the Corporation for Enterprise Development (CFED), a national nonprofit that advances policies and programs focused on helping low- and moderate-income people build and preserve assets.
Key Facts & Figures
|States that have enacted an Earned Income Tax Credit (EITC) (2017)||29 (and DC) *|
|States with statewide programs to expand access to safe and affordable financial products to underserved people||7|
|States providing funding for Individual Development Accounts (IDAs) (2017)||11 (and DC)*|
|States with protections against payday lending (2018)||15 (and DC)*|
Our Articles and Publications section includes links to a diverse selection of articles, reports, and papers focused on state asset building. One such paper is Aleta Sprague and Rachel Black’s State Asset Limit Reforms and Implications for Federal Policy (2012), which demonstrates that by eliminating asset tests—i.e., requirements that program recipients have limited resources– states can improve the administration of their public assistance programs.
Lastly, our Toolbox features resources designed to help on-the-ground practitioners working in this field. There, you can access the Corporation for Enterprise Development’s Children’s Savings Accounts: A State Policy Sourcebook, which aims to serve as a comprehensive toolkit for those developing state CSA policy, and includes suggestions for legislative/regulatory tactics, CSA successes to date, innovative practices, and current policy trends.