As the economic downturn continues to take its toll in Oklahoma and across the nation, how financially prepared are families to deal with extended periods of unemployment and underemployment. Newly-released data (PDF) from CFED that focuses on “asset poverty” confirms that many Oklahomans have little or no financial cushion on which to fall back.

Asset poverty is a measure that establishes a minimum threshold of wealth needed for household security:

A household is asset poor if it has insufficient net worth to support itself at the federal poverty for three months in the absence of income. Asset poor households would not have enough savings or wealth to provide for basic needs during a sudden job loss or a medical emergency. Read the rest of this entry »

How much does an Oklahoma family have to earn to meet its basic needs? What are the major costs of a family budget, and how do these vary for different family types and in different parts of the state? How much of an impact can work  support programs like food stamps and SoonerCare have in bridging the gap between what families earn and what they need to get by?

The Self-Sufficiency Standard for Oklahoma [3 MB PDF], released last week, provides new data that can help answer these questions and many others. The Standard was developed by Dr. Diana Pearce of the Center for Women’s Welfare at the University of Washington for the Oklahoma Asset Building Coalition. The new report updates the original Oklahoma Self-Sufficiency Standard released in 2002. Over the years, the Standard has been used for a wide range of purposes, including career counseling, workforce development, grant-writing, research, and advocacy. Read the rest of this entry »

Oklahoma’s Poverty Profile: 2008 is a new two-page fact sheet of graphs and analysis that spotlights some of the salient characteristics of the population living in poverty in our state. The information is all assembled from the U.S. Census Bureau’s American Community Survey, which was released this past August.  Among some of the findings presented in the fact sheet:

• Nearly one in six Oklahomans (15.9 percent) lived below the federal poverty level  in 2008, which was just over $22,000 annual income for a family of four. The state’s 2008  poverty rate was unchanged from 2007 but remained 2.7 percentage points higher than the national average.
• Forty percent of those in poverty, and 6.4 percent of the total population, had incomes of less than half the poverty level (see chart). Read the rest of this entry »

We’ve recently joined with CFED, a national organization dedicated to expanding economic opportunity, and the Oklahoma Asset Building Coalition, in releasing the 2009-2010 Assets and Opportunity Scorecard. Our earlier post summarized the Oklahoma results, as did several media reports.

One area where Oklahoma needs to do better is our 529 college savings plan. Section 529 of the federal tax code allows families to set aside savings in a special account overseen by the state government. Interest earnings on the account are not subject to the federal or state income tax. CFED points out that: Read the rest of this entry »

It is widely known that minorities in the United States earn considerably less than Whites – according to the most recent Census Bureau data, the median income for a White household in 2008 was 34.5 percent greater than for a Black household and 28 percent higher than for a Hispanic household. Poverty rates for Blacks and Hispanics are also more than double than for Whites.

What is less frequently noted is that the racial wealth gap in America is even greater than the income gap. The 2009-10 Assets and Opportunity Scorecard that was recently released by CFED reports that for the nation as a whole,  the median White household possesses net worth (the sum of all assets less liabilities) six times greater than the median minority household: $122,505 compared to $20,132. In Oklahoma, the racial wealth gap was found to be even larger: the median white household enjoys net worth of $66,468 compared to just $6,620 for the median minority household, a gap of  10:1. Additionally, the report found that 37.2 percent of minority households nationally and 43.7 percent in Oklahoma live in “asset poverty”, meaning that they lacked sufficient net worth to subsist at the poverty level for three months in the absence of income. (By comparison, 16.4 percent of White households nationally and 15.9  in Oklahoma were determined to be “asset poor”). Read the rest of this entry »

Monday we participated, along with other members of the Oklahoma Asset Building Coalition, in the release of the 2009-10 Assets and Opportunity Scorecard, a major  report that looks at wealth, poverty, and the financial security of families in all 50 states.  The Scorecard provides data on how each state is doing on a cluster of measures in five issue areas: financial assets and income; businesses and job; housing and homeownership; health care, and education. The report also evaluates states on their success in adopting policies in each of these areas that strengthen asset development and financial security.  The Scorecard website is a treasure trove of data comparing all 50 states and offering detailed discussion of state policies; if you’re primarily interested in Oklahoma’s outcomes and policy rankings, click here. The Scorecard has also received a lot of press coverage, including articles in the Oklahoman and the Journal Record. Read the rest of this entry »

The Obama administration recently announced a series of measures aimed at making it easier for Americans to save.  As the New York Times article on the initiative noted, the measures are all rooted in research from the field of behavioral economics:

One key finding in that research is that people are more likely to contribute to a retirement savings account, like an employer-sponsored 401(k) plan, if they are enrolled automatically. Workers have usually had to sign up for the plan, something that large percentages of people either postponed or never did at all.

The Administration’s measures will: Read the rest of this entry »

Last week I was fortunate enough to attend the first Conference on Children and Youth Savings sponsored by CFED, a national organization dedicated to expanding economic opportunity for all Americans. According to CFED,

People who own assets–such as a savings account–are more likely to have a more positive outlook and higher expectations for their futures and the futures of their children.

Children and youth savings accounts are created, mostly for low- and moderate-income children, at birth (or later in some programs) and initially funded with a small government contribution. As the child grows, additional contributions from family, friends, and, in some cases governments, help the account grow. Some programs limit use of the funds to education, while others offer broader opportunities or no limitations at all once the child reaches age 18. The theory behind children and youth savings accounts is:

• that low-income students (and their parents) will begin to see college as an achievable and affordable goal;
• that a savings habit learned in childhood is an asset for life;
• that youth savings will build assets for education, home ownership, and business start-ups; and
• that benefits of saving and investing by children help grow community and national economies.

CFED has been the main player in the SEED Initiative, a 10-year program to develop, test, inform, and promote children savings accounts. SEED incorporates 12 demonstration projects, including one in Oklahoma. The conference brought together a couple of hundred local service providers, funding agencies, government managers, and researchers in an effort to assess SEED and other efforts and to help figure out what comes next.

I got a decidedly mixed picture about children’s savings accounts from this experience. Here’s the good news: Read the rest of this entry »