In Oklahoma, more than one in four households are “asset poor,” meaning they have little or no financial cushion to rely on if unemployment or another emergency leads to a loss of income, according to a report released today by the Corporation for Enterprise Development (CFED).  Asset poverty is distinct from and broader than income poverty, which measures the amount of money a household receives during the year.  According to the U.S. Census, about one in six Oklahomans were income poor in 2010.  Andrea Levere, president of CFED, highlights asset poverty as a significant barrier to long-term financial stability:

Growing numbers of Americans have almost no savings or other assets to fall back on if they lose their jobs or face a medical crisis.  Without those savings, few will be able to invest in a more economically secure future, including buying a home, saving for their children’s college educations or building a retirement nest egg.

The 2012 Assets & Opportunity Scorecard offers a comprehensive look at Oklahomans’ ability to build wealth, fend off poverty, and create a more prosperous future. The Scorecard compares states along 52 different measures of how residents fare in five issue areas: Financial Assets & Income, Businesses & Jobs, Housing & Homeownership, Health Care and Education. Read the rest of this entry »

Our friends at Prosperity Works have created an excellent video on the ins-and-outs of IDAs.  What is an IDA?  It is not, as some Facebook users suggested, internet dating advice or the International Department of Awesome.  IDA stands for individual development account.  It’s a matched savings account for low and moderate income earners to save for important assets like a college education, a home, or a business.  Watch this animated short video to find out more or click here to find an IDA near you.

View other clips from OKPolicy’s “Watch This’ video series:

Elderly parole

Long term unemployment, 1967-2011

Packed Oklahoma prisons, rising costs

Creativity & Learning

Jennifer Wallis is a certified consumer credit counselor and the Vice President of Consumer Credit Counseling Service of Central Oklahoma.  To learn more about Consumer Credit Counseling Services of Central Oklahoma, visit www.cccsok.org or contact Jennifer Wallis at (405) 789-2227.

According to the Fair Isaac Corporation, 58 percent of Americans have credit scores above 700, which is considered a really good score. If you are among the other 42 percent, it may feel like you will always be stuck with a lower score. Fortunately, credit scores are just a snapshot of your credit at one point in time and can change frequently. In just a few short months, you could notice a big increase in your credit score if you work to improve it. Bad credit is not a life sentence.

Poor credit and the resulting low credit score may mean that you can’t borrow money from traditional lenders like banks and credit unions. If you are able to borrow money at all, you may have to pay increased interest rates and higher overall prices.  Because of this, studies have shown that people with poor credit can pay $250,000 more over their lifetime more than people with good credit. Read the rest of this entry »

Assets mean economic security.  Yet impoverished families frequently lack the means to build assets.  Some are even sanctioned by public assistance programs from accumulating the wealth they need to escape poverty.  Oklahoma earned a “C” grade from the Corporation for Enterprise Development in a national report ranking states on opportunities for wealth creation and protection, particularly for low-income residents.  That same report says 23 percent of Oklahoma households are asset poor, lacking sufficient net worth to subsist at the poverty level for three months if their income was disrupted. Read the rest of this entry »

Oklahoma Assets is seeking a Project Manager to support the development of its organizational structure and implementation of its program and partnership activities.  Oklahoma Assets is a non-profit organization whose mission is to advocate policies and programs that can help create a more inclusive economy – one in which financial success, economic stability, and opportunity is available for all. Read the rest of this entry »

This blog post was excerpted from remarks by Angela Glover Blackwell, founder and CEO of PolicyLink, during the opening session of PolicyLink’s 2011 Equity Summit in Detroit, Michigan.  The speech presented a new framework for creating an equitable economy.  Click here for a new report from PolicyLink looking at how demographic changes and deepening inequality demand an urgent re-imagining of our economy.

This is a critical moment.  The economy is in crisis.  The middle class is shrinking.  Inequality has come front and center in our conversation in America and we have rapidly changing demographics in which the racial and ethnic composition of the country is changing fast.  This economic crisis really represents a failed growth model, one that was based on a housing bubble; one that was allowed to present itself as opportunity when it was really only credit-fueled consumption that was improving the lifestyles of people [..] Read the rest of this entry »

Access to credit has become a necessity for modern American living, touching virtually every aspect of our lives. Many consumers need credit to buy a house or a car, get an education, pay for medical expenses, or start a business.  ‘Credit’ is a generic term for an array of financial products and services that involve the borrowing of money and ‘affordable’ means terms of credit proportionate to a borrower’s ability to repay.  This post explores the critical role of credit in helping Oklahomans maintain financial security and build assets for a prosperous future, based on a newly released paper from Oklahoma Assets.  Oklahoma Assets advocates for policies and programs that can help create a more inclusive economy – one in which financial security and economic opportunity is available, not just to some, but to all Oklahomans.  Their new release, ‘Affordable Credit in Oklahoma: Asset-building and Financial Security‘ is available on their website along with their first brief on the importance of savings.

Affordable credit plays a pivotal role in a household’s capacity to maintain financial security and build assets. Lower income earners in particular need the flexibility that credit affords to handle emergencies, make ends meet, and avoid high cost credit products that could set them back even further.  When households without access to affordable credit face emergency situations that threaten their ability to work—like illness or car repairs—they either take the credit they are offered, often at prohibitive rates of interest, or face unemployment and insolvency. Read the rest of this entry »

Everyone manages money almost every day.  Often we wonder how to better manage our money when it seems there is never enough.  CareerBuilder surveyed 3,900 American workers and found that more than six-in-ten workers – 61 percent – live paycheck to paycheck.  Many families have no way to cover day-to-day expenses if their income drops or disappears.  Unemployment, medical crisis, or car repairs can put a family into debt – or deeper into debt if they already owe large sums.  Such families are “asset poor.”  Michael Sherraden, director of the Center for Social Development at Washington University and author of Assets and the Poor: A New American Welfare Policy, points out that assets affect us financially, socially and psychologically in a way that income alone does not.

Asset-building is beginning to gain traction as an anti-poverty strategy.  Assets for Independence (AFI), a federal grant program that enables nonprofits and government agencies to incorporate assets-based principles into their programming, recently launched the ASSET Initiative.  The ASSET Initiative hopes to expand the reach of the asset-building message and encourage more collaboration across government agencies who do anti-poverty work.  Another such initiative that is picking up steam locally is Oklahoma Assets, an organization whose mission is to advocate policies and programs that can help create a more inclusive economy – one in which financial success, economic stability, and opportunity is available, not just for some, but for all. Read the rest of this entry »

OK Policy is an active member of Oklahoma Assets, a statewide coalition that aims to identify and strengthen programs and policies that help Oklahoma residents achieve economic security.  Oklahoma Assets has been making big strides in recent months, officially incorporating as a 501(c)(3) organization.  Steering committee members met in Oklahoma City in May to approve bylaws and vote in a board of directors.  The coalition has also been busy hosting three webinars on asset-building strategies: the importance of savings, financial education in public schools, and Individual Development Accounts (IDAs).

In 2009, we blogged about a series of regional meetings hosted throughout the state by Oklahoma Assets (formerly OkABC) on asset-building strategies for increasing the financial security of Oklahomans.  Click here for a recap of the Oklahoma Assets day-long meeting in April 2009 on “Economic Security for Oklahomans: Asset Building Approaches for Assisting Families with Low Incomes,” where results of the regional meetings were shared and discussed. Read the rest of this entry »

Access to credit has become a necessity for modern American living, touching virtually every aspect of our lives. You need credit to buy a house or a car, pay for medical expenses, even rent an apartment.  Obstacles to affordable credit can create obstacles to work.  Without a car and a place to live, a job is difficult to maintain.  Simply put, credit enables individuals and families to create the basic building blocks of a healthy and prosperous life.

Unfortunately, a number of factors, including insufficient income, existing debt, and a tainted or non-existent credit history affect low- to moderate-income borrowers’ ability to access affordable credit through mainstream financial institutions.  Credit access is also exacerbated by a paucity of mainstream financial outlets in low-income neighbourhoods.  When households with limited access to affordable credit face emergency situations that threaten their ability to work—like illness or car repairs—they often have no choice but to take any credit that they are offered, often at prohibitive rates of interest. Read the rest of this entry »

As we recover from the great recession, the need to create jobs is foremost in the minds of the public and the promises of politicians. But if too many jobs don’t pay enough to cover the basic needs of a family, we may only dig ourselves further into a hole and cripple our ability to support the next generation of Americans.

So what is an adequate income to meet those basic needs? The question is important, as it determines how we set goals, determine eligibility for public support, and understand many problems in society. Yet the tool most commonly used to measure this, the federal poverty level (FPL), is long out of date. It considers only cash income and expenses of three times the cost for a 1950s diet.  That was appropriate when the measure was created, as food took up a third of the typical household budget at the time. Today it is less than one-tenth. The measure also does not adjust for differences in the cost of living by region or family type. Read the rest of this entry »

A few weeks ago I had the opportunity to attend a conference hosted by the Ford Foundation and Howard University’s Center on Race and Wealth.  The three-day meeting was the first annual gathering of a diverse group of representatives supported by grants from the Ford Foundation’s Building Economic Security Over a Lifetime initiative.  The initiative promotes programs that help low-income families achieve and maintain economic stability throughout their lives.  The conference focused on a particular and troubling aspect of economic achievement in the United States:  the racial wealth gap.

Few ideas are more evocative of the American dream than wealth and economic security, yet opportunities to accumulate wealth and secure income have never been equally distributed.  In virtually every measure of wealth, non-white households are falling behind.  For example, homeownership, the primary vehicle for building wealth for most Americans, is more attainable for white households than their minority counterparts.  According to the U.S. Census, in 2008 only 47.5% of African-Americans and 48.9% of Hispanics owned their own homes, compared with 74.9% of whites.   White households continue to accumulate more savings, more assets (vehicles, houses, businesses), and more wealth, consistently maintaining larger net worths than minority households.  While some of this gap is attributable to higher incomes and educational attainment, it takes a longer view of history to understand and explain its persistence.  Historically, some of the largest expansions of American wealth were achieved through sacrifices disproportionately shouldered by the poor, the disenfranchised, and communities of color. Read the rest of this entry »