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.
Oklahoma ranks 33rd overall and earns a “D” in Financial Assets & Income, with above-average income poverty and an over-reliance on predatory lenders and subprime credit. In Health Care, the state ranks 46th in the overall uninsured rate and 47th in uninsured low-income parents. We rank 43rd in residents with two- or four-year college degrees. The one bright spot among the five issue areas for Oklahoma is in housing and homeownership. The state earned a “B” on the Scorecard and ranks 14th in overall homeownership and housing affordability.
The Scorecard also highlights a dozen policy solutions that can help Oklahoma increase opportunity and promote financial stability. To address asset and income poverty, Oklahoma should fund a state Individual Development Account program to help its low-income population build wealth. To improve its below-average secondary and post-secondary educational outcomes, Oklahoma should increase funding to schools, especially in high-poverty districts, and match savings for college in 529 accounts. In addition, to protect assets and avoid the pitfalls of predatory high-cost loans, Oklahoma should increase access to safe financial products and limit high interest rates and other harmful practices of payday lenders.
Oklahoma Policy Institute is co-releasing the Assets & Opportunity Scorecard as part of an ongoing commitment to advance anti-poverty policies in Oklahoma that prioritize wealth creation and asset-building for low- and middle-income households. Oklahoma Policy Institute Director, David Blatt, interprets the scorecard results to mean that, “Too few Oklahomans have a college degree and too many are living in asset poverty, without the savings to weather a financial setback or invest in their future. We need better policies that ensure that all Oklahomans are on a path to prosperity and we must protect existing policies, like tax credits for working families, that help hundreds of thousands of households make ends meet.”
The Scorecard paints a picture of a country where middle class families continue to fall further behind more than two years after the official end of the recession. For ‘asset poor’ families, making ends meet from day to day is a constant struggle and investing in the future is all but impossible. Locally, a new organization is committed to promoting those policies that improve the outlook for poor, near poor, and middle class Oklahomans. The mission of Oklahoma Assets is to advocate policies and programs, like the ones just outlined, that create a more inclusive economy – one in which financial success, economic stability, and opportunity are available for all.
To download a summary of Oklahoma’s Scorecard click here.
To view all Oklahoma data from the 2012 Assets & Opportunity Scorecard click here.
To access the complete Scorecard, including data from all 50 states click here.