To combat asset poverty, encourage saving, promote financial literacy, expand opportunities for young adults and ensure that our nation’s savings and ownership policies assist working-poor families by enabling them to save, build wealth and enter the financial mainstream, Congress must act to pass effective asset building legislation like the Savings for Working Families, Financial and Economic Literacy Improvement and ASPIRE Acts.

Overview

Saving must begin at childhood. Just as with education, evidence suggests that the earliest interventions can have the greatest impact on life outcomes. Asset ownership has been demonstrated to positively impact children’s development, school achievement, health and outcomes as adults.

Action for Children advocates for asset building policies that can provide children with equal access to opportunities in adulthood and the tools to participate in North Carolina’s economy. Along with state-level work on asset development, Action for Children advocates for asset building legislation on the federal level.

Did you know? Today, more than 1-in-3 children in North Carolina are born into families that lack sufficient savings to weather emergencies or effectively invest in their children’s futures.

Child Asset Poverty by State, 2004

Expected and Introduced Asset Development Legislation in 111th Congress

• Savings for Working Families Act of 2009 (H.R. 2277/S. 985) This act would make Individual Development Accounts (matched savings accounts that help low-income families build appreciating assets) available to 2.7 million low-income families across the country and expand funding for financial education. In North Carolina, there are 32 local IDA programs in 55 counties, helping people save. From 1999 to 2007, NC IDA account holders saved an aggregate $1.8 million, acquired more than $970,000 in matching grant funds, and purchased an estimated $43.2 million in assets. (Source: North Carolina Department of Labor, IDA Annual Report, 2007.) 
• Financial and Economic Literacy Improvement Act of 2009 (H.R. 1645/S. 638) This act would improve financial and economic literacy education efforts in public schools and institutions of higher learning.
  
• America Saving for Personal Investment, Retirement and Education (ASPIRE) Act An act similar to last session's would endow an account for every child in the country to ensure that all children have access to the infrastructure and incentives to save. Children in low-income families would be eligible for matching funds.
• Retirement Savings for Working Families Act An act similar to last session's would improve the federal Saver’s Tax Credit for contributions made into retirement plans. The bill expands the credit to more middle-income families, establishes a flat 50% match and indexes the contribution limits to inflation.
• Focusing Investments and Resources for a Safe Transition (FIRST) Act An act similar to last session's would enable states to establish IDAs for foster youth to assist them in becoming self-supporting as they transition to adulthood and out of the foster care system.

What You Can Do

Urge your Senators and Representative to cosponsor and support  the Savings for Working Families Act of 2009, the Financial and Economic Literacy Improvement Act of 2009 and other pieces of legislation focused on expanding low-income families’ access to asset-building opportunities.

The Savings for Working Families Act has the support of many private- and non-profit-sector organizations including the American Banking Association, H&R Block, the Credit Union National Association, United Way of America, America’s Community Bankers, the National Urban League, the National Council of La Raza, Consumer Federation of America and many more.

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