Innovative Ways Cities are Meeting Residents’ Financial Needs

This is the seventh and final post in our blog series on financial inclusion. This post highlights an array of programs and services to meet the diverse financial needs of city residents.

Financial inclusion(Getty Images/Chris Hondros)

“To fully participate in the economic fabric of a community, all families must have access to the financial tools and pathways necessary to reduce debt and prepare for the future. The City of Nashville is committed to making this happen through programs and services to help residents build assets and become financially stable.”
Megan Barry, mayor, Nashville, Tennessee

Mayor Barry knows that in order for her city to thrive, families must be financially stable. Yet, over half of Americans lack emergency savings to weather a financial crisis, and many families do not have access to the tools and information necessary to make informed financial choices.

MetLife TA projectMany mayors are following Mayor Barry’s lead and taking steps to develop financial inclusion strategies and programs that address the financial challenges that families face every day. While some cities have had “pillar” programs in place for many years (programs that offer financial education or connect families to homeownership opportunities, public benefits and tax credits), in the last five to ten years there has been an emergence of new, innovative programs at the local level that address more complex financial challenges.

Figure05_ProgramsIn NLC’s report on financial inclusion efforts, a quarter of the cities surveyed for the report indicated that they have innovative programs in place to help families save, reduce debt, access safe and affordable financial services, and financially prepare for the future.

One of the more popular municipal strategies emerging from city halls across the country in recent years has been Bank On. In this model, cities work with community organizations and financial institutions to connect un- and underbanked residents, who often rely on high-cost predatory financial services such as check cashers and payday lenders, to safe and affordable bank accounts.

San Francisco Treasurer José Cisneros and former Mayor Gavin Newsom first developed the Bank On model in 2006, and there are now over 100 Bank On programs in cities around the country.

Other local strategies focus on encouraging residents to save money. One way cities are doing this is through Individual Development Accounts (IDAs), which are designed to help low-income families save for homeownership, education or small business ownership. An individual’s or family’s savings are usually matched one to four times the amount of the deposit. For example, the city of Columbia, South Carolina offers residents an IDA with a city-funded 3:1 match.

Children’s savings accounts (CSAs) are another savings strategy that has caught the attention of many city leaders. San Francisco’s CSA, Kindergarten to College, offers all public kindergarten students a savings account for college with an automatic deposit of $50. St Louis, Missouri; Lansing, Michigan; and Caldwell, Idaho are offering similar accounts to young children, typically coupled with financial education for the whole family.

Debt reduction programs are also growing in popularity with city leaders. In partnership with NLC, five cities have implemented a new program in the last two years to connect residents in debt to public utilities to financial empowerment services in order to help these residents pay their debt while acquiring resources to improve their overall financial well-being.

Known as LIFT-UP (Local Interventions for Financial Empowerment through Utility Payments), this program is a win-win for cities that want to reduce their expenditures on utility debt collection and shut-offs while also helping struggling families. The city of Houston, for example, has integrated financial counseling into the city water utility’s customer service so that customers can receive the help they need on-site or over the phone.

This concept of financial inclusion service integration, which LIFT-UP employs, refers to the incorporation of financial inclusion programming into existing city programs and services, such as public housing and workforce development. For example, Seattle offers discounts on city services, such as utilities and car registration fees, to low-income residents that take advantage of financial coaching through the city’s Financial Empowerment Center (FEC).

FECs are one-stop centers where residents can receive financial coaching, help in managing debt and improving credit and access to financial services. Started in New York City by the CFE Fund, FECs have been replicated in cities around the country, including Nashville and San Antonio.

These examples offer a glimpse into the myriad ways that cities are making concerted efforts and thinking outside the box to make their communities more financially inclusive. As previous posts in this series have demonstrated, it takes bold leadership, a clear vision for success, strong partnerships and more to build a foundation from which innovative financial inclusion programs can grow and truly impact the lives of families in need.

About the Author:Heidi Goldberg Heidi Goldberg is the Director for Economic Opportunity and Financial Empowerment in NLC’s Institute for Youth, Education, and Families. Follow Heidi on Twitter at @GoldbergHeidi.

Local Financial Inclusion Programs Build a Strong Foundation for Financial Well-Being

This is the sixth post in our blog series on financial inclusion. The series provides examples and action steps to help city leaders start or strengthen financial inclusion efforts. This post highlights local financial inclusion programming, with a focus on the four most common types of programs.

Couple working on finances(Getty/Fuse)

Proven, effective financial inclusion programs and services are essential to city leaders in helping residents become more financially secure. Local financial inclusion programs can vary widely in strategy, but they succeed when key components are in place, including strong champions, community commitment and partnerships and a clear vision for success.

In our recent scan of municipal financial inclusion programs, NLC found that those cities with the most successful and comprehensive financial inclusion programs tend to have a set of foundational or “pillar” programs in place. Sixty-three percent of the cities surveyed as part of our scan reported having at least one of four common financial inclusion Figure04_Pillars“pillar” programs in place:

  • Volunteer Income Tax Assistance (VITA) and federal Earned Income Tax Credit (EITC) outreach,
  • Multi-benefit outreach and access,
  • Financial education, counseling and/or coaching, and
  • Homeownership assistance.

By investing in these pillar programs, cities can customize tried and tested strategies, and by doing so can propel innovation and increase impact. Many cities have had some of these pillar programs in place for several years, which has positioned them to build out their financial inclusion strategy through ongoing services and partnerships.

Pillar programs tend to attract attention from community partners interested in expanding their financial assistance program offerings. This type of community buy-in increases the likelihood of additional funding for local financial inclusion programs from state and federal sources as well as private funders, such as banks.

Figure05_ProgramsVolunteer Income Tax Assistance (VITA)/ Earned Income Tax Credit (EITC) Outreach
VITA is a federally-funded program that provides free tax preparation for low- to moderate-income families. It also helps increase awareness of the Earned Income Tax Credit (EITC), a federal credit for low- and moderate-income workers. Fifty-two percent of survey respondents indicated their city has a VITA/EITC outreach program in place.

The Center on Budget and Policy Priorities reports that in 2013, the EITC lifted about 6.2 million people out of poverty, including 3.2 million children. VITA protects residents from predatory tax services while increasing the EITC’s financial impact.

Currently, 25 states and the District of Columbia have their own local EITCs to supplement the federal credit. For example, Chicago directly funds VITA and EITC outreach efforts, with city officials lending support by promoting these services to residents. In Hattiesburg, Mississippi, Mayor Johnny Dupree started the city-funded Education Initiative to provide free tax preparation services to residents and promote awareness of the federal EITC and the Child Tax Credit.

Multi-Benefit Outreach and Access
Cities are boosting the economic well-being of residents directly by connecting them to federal benefit programs such as SNAP (Supplemental Nutrition Assistance Program) and federal health insurance benefits like Medicaid through direct outreach, often joining with local nonprofits to refer residents to programs and help them complete benefit applications.

Over 48 percent of survey respondents indicated their city operates at least one multi-benefit outreach or access program. Pittsburgh has incorporated health benefits outreach into their 3-1-1 call system. When residents call, they hear a message about health coverage and enrollment assistance. Operators are trained to answer questions and refer residents to agencies that can help them get enrolled in Medicaid or the Children’s Health Insurance Program.

Saving

(Getty/Wavebreakmedia Ltd)

Financial Education, Coaching and Counseling
Financial education help residents learn to create a budget, manage debt, improve credit, build savings and plan for retirement. Financial counseling helps financially struggling individuals and families to manage immediate problems, typically providing a short-term intervention, and financial coaching offers one-on-one interactions with a trained financial counselor to identify issues such as wasteful personal spending patterns, for example. Coaches work with clients to design a plan for improvement and track their progress.

Forty-six percent of the cities surveyed indicated they have financial education, coaching and counseling programs in place, including Garden City, Michigan. The city offers the Financial Peace University curriculum, which teaches residents how to manage debt, build savings and plan for retirement. The city also offers a similar curriculum designed for teens that focuses on savings and understanding credit.

Homeownership Assistance
Cities provide homeownership assistance in many forms. Like financial education, coaching and counseling, homeownership assistance, 46 percent of cities surveyed said they offer homeownership assistance to residents. For example, Providence, R.I. provides home repair grants and support for first-time home buyers, including pre-purchase education. St. Petersburg, Florida offers home repair loans to residents who are at or under the city’s median household income. Grants are also available to physically, visually or hearing impaired home owners and renters for ramps, chair lifts and other features that make a home accessible for persons with disabilities.

These pillar programs can provide cities with a strong foundation from which to build a more advanced and comprehensive financial inclusion agenda. Through these programs, residents can improve their financial well-being by gaining access to assets such as tax credits, nutrition benefits, financial information and the ultimate American dream of owning a home.

However, the potential for local action to improve their residents’ financial state expands well beyond some of these “tried and true” local strategies. Many cities have implemented or are in the process of putting in place innovative programs to help residents build financial stability. These more advanced, innovative programs will be featured in our next and final blog in this series. Stay tuned!

Heidi Goldberg
About the Author:
Heidi Goldberg is the Director for Economic Opportunity and Financial Empowerment in NLC’s Institute for Youth, Education, and Families. Follow Heidi on Twitter at @GoldbergHeidi.

How Community Partnerships Can Help Advance City Financial Inclusion Efforts

This is the fifth post in our financial inclusion blog series. The series provides examples and action steps to help city leaders start or strengthen financial inclusion efforts. This post focuses on the role of community partners in implementing financial inclusion efforts.

ThinkstockPhotos-83313318Partnerships hold the key to successful local financial inclusion systems. (Michael Blann/Getty Images)

Strategic partnerships between local governments and stakeholders are a critical step that cities can take to advance their financial inclusion efforts.

It’s no surprise that cities are most effective when they bring together a broad-based network of community partners to improve the well-being of individuals and families and strengthen the local economy. Support and buy-in from community partners, including nonprofits, the local business community, and state and regional coalitions can foster sustainability in programs designed to help residents build financial stability.

NLC’s financial inclusion report highlights the innovative partnerships in cities across the country that are meant to help city leaders mitigate the financial hardships many of their residents face on a daily basis.

Our report is the result of an in-depth scan of financial inclusion programs in cities across the U.S. The scan included a survey, with 34 percent of survey respondents indicating that community leaders other than mayors or councilmembers, including local business and nonprofit organizations, have made it their mission to address the financial needs of families by dedicating staff to support financial inclusion programming, participating in committees or task forces, initiating asset-building coalitions, etc.

Lansing, Mich., for example, established the Employee Empowerment Corps (EEC), a collaborative partnership of the Lansing’s Financial Empowerment Center, Center for Financial Health and the Asset Independence Coalition, to pioneer innovative approaches to increasing financial well-being for low-and moderate-income employees. The EEC delivers financial counseling, income support through the Volunteer Income Tax Assistance (VITA) program and benefits access and asset-building opportunities through homeownership.

The United Way of Metropolitan Nashville partners with Mayor Karl Dean’s office to operate the Nashville Financial Empowerment Center and offers free tax preparation and other financial inclusion services to residents.

CITIES_Figure07_webOne of the most common partnerships for local governments is with a financial institution, often a community bank with strong roots in the community. One third of survey respondents reported working directly with banks on financial inclusion efforts.

These relationships present a ‘win-win’ situation for the city and the bank. Columbia, S.C. launched a campaign in partnership with Wells Fargo Bank that targets the largest public housing facility in the city for financial education workshops and promotes no- and low-cost bank accounts. Many cities, including Denver; Houston; Nashville, Tenn.; San Francisco, Seattle; and Virginia Beach, Va., cited Bank On program that helped municipalities and stakeholders build partnerships with financial institutions. To date, approximately 100 cities have Bank On campaigns.

Other cities are integrating financial capability into existing programs. Los Angeles partnered with the Los Angeles Area Chamber of Commerce to launch Hire LA’s Youth, a summer jobs program that provides job readiness, financial literacy training, on the job experience and a paycheck to young people.

Community partners often have the power to generate a wide base of support that can outlast an elected official’s term. Thirty-six percent of cities surveyed indicate that nonprofits lead financial inclusion efforts, without significant support from the city government.

Cities can still support local financial inclusion efforts through:

  • Co-branding and publicizing materials that provide information on available services,
  • Broadcasting announcements on local cable access channels,
  • Incorporating messages in water/utility bills,
  • Presenting to community groups, and
  • Promoting special events such as Financial Literacy Month.

CITIES_Figure02_webCity governments and their partners can also collaborate with national organizations to better meet residents’ needs. Louisville, Ky. partnered with the National Disability Institute to convene the first-ever Economic Advancement Assembly, bringing together 40 organizations focused on tailoring financial capability programs to better serve individuals with disabilities. Community stakeholders, with strong support from Louisville Mayor Greg Fischer, highlighted emerging needs of the disability community and specifically identified where agencies could better collaborate to provide more effective service for this population. The Assembly led to the creation of the Workforce Development/Financial Empowerment Collaborative, which is developing recommendations to help Louisville and cities nationwide better serve individuals with disabilities through financial inclusion programming.

Denise Belser
About the Author:
Denise Belser is the Program Manager for Family Economic Success at the NLC Institute for Youth, Education, and Families.

Financial Inclusion Takes Center Stage in Nashville

This is a guest post by Erik Cole.

This is the fourth post in our financial inclusion blog series. This post highlights Nashville’s Financial Empowerment Center and the impact that their programs and services are having on the community.

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Nashville Mayor Karl Dean with clients at the Nashville Financial Empowerment Center. (photo: Erika Chambers ©2015 United Way of Metropolitan Nashville)

In 2013, Nashville Mayor Karl F. Dean partnered with the United Way of Metropolitan Nashville to create the Nashville Financial Empowerment Center (FEC), which consists of two main centers and six satellite sites across Davidson County. The Center was established to strategically address the needs of the 17 percent of Nashville’s population who live below the poverty line.

Based on New York City’s model, Nashville’s Financial Empowerment Center offers free one-on-one financial counseling to residents. Counseling services are integrated into existing social service agencies and public locations such as Nashville’s public libraries. Counselors are professionally trained and provide their clients with assistance in:

  • Budgeting and building savings
  • Reducing debt
  • Opening safe and affordable bank accounts
  • Establishing and improving credit

Mayor Dean quoteThe Financial Empowerment Center is a key piece of Nashville’s economic and community development portfolio. This portfolio also includes Bank On Music City, which connects unbanked individuals and families to bank accounts and quality financial education programs; the Nashville Alliance for Financial Independence; and the United Way’s Volunteer Income Tax Assistance program, which provides free tax return assistance to low- and moderate-income people.

Making Financial Inclusion a Reality
In order to make the idea of the Financial Empowerment Center a reality, Mayor Dean’s office and the United Way of Metropolitan Nashville pursued funding from Bloomberg Philanthropies’ Cities for Financial Empowerment (CFE) Fund. In January 2013, the CFE Fund selected Nashville, along with four other cities, to receive a $16.2 million, three-year investment. The other cities chosen include Denver, Philadelphia, San Antonio and Lansing, Mich.

Since opening in March 2013, Nashville FEC staff have helped over 3,200 people and held more than 10,000 individual counseling sessions. The FECs have helped residents reduce their collective debt by over $1.9 million and increase their savings by over $500,000.Rosa Moore quote

With the help of her FEC coach, Rosa has continued to attack her debt, paying off several accounts in full. She also pursued consumer protection claims against a creditor as part of a national settlement. She has further built an emergency savings account to protect her in the future.

Nashville has seen success integrating financial counseling into a multi-cultural community center, the Casa Azafrán Community Center. By co-locating with existing nonprofits at the center, this FEC site is able to offer wrap-around financial support services to individuals in need and help move them toward self-sufficiency. This center has effectively created an environment in which residents have a one-stop-shop for all their social service needs.

The FEC’s partnership with Habitat for Humanity promotes financial education and counseling with the ultimate goal of helping families in need to secure and maintain a home. This partnership with Habitat has resulted in four families becoming homeowners to date, and several more are currently working towards homeownership. These families began this journey with large amounts of debt and very low credit scores.

Looking to the future, Mayor Dean and the United Way of Metropolitan Nashville plan to integrate other partners into the FEC model. They are working with local partners to integrate financial counseling into youth employment and workforce development efforts as well as public housing and support services for homeless families.

This November, Nashville will host NLC’s annual Congress of Cities conference. Don’t miss our workshop on financial inclusion, which will feature an in-depth look at the innovative programs that cities, including Nashville, are implementing to address their residents’ financial challenges. The workshop will also highlight the results from our recent report, Local Financial Inclusion Efforts: A National Overview.

Erik Cole
About the Author:
Erik Cole was named Nashville’s first Director of Financial Empowerment in February 2013. The Nashville Financial Empowerment Center is a public/private partnership based in the Mayor’s office. He is also a former two-term Metro City councilmember.

How Financially Inclusive Cities Develop a Clear Vision for Success

This is the third post in our blog series that explains what financial inclusion is and provides examples and action steps to help city leaders start or strengthen financial inclusion efforts. This post focuses on the importance of developing a vision and setting goals to help provide a safety net for struggling families and strengthen local economies.

(efks/Getty Images)

As strategies to help families stay connected to the financial mainstream become both more prevalent and innovative, developing a vision and goals is necessary for city leaders to implement effective programs that improve services for financially vulnerable families. Just as importantly, cities should be able to track the progress of these efforts. A long-term strategic vision and a set of clear, measurable goals that are informed by data are crucial components of an effective local financial inclusion agenda.

Developing a Shared Vision
City leaders can involve a variety of stakeholders, including city agencies, nonprofits, private sector partners and residents in developing a collective, long-term vision for financial inclusion efforts. Collaboration can increase stakeholder buy-in and ensure a diverse group of voices are included throughout the process.

Establishing a dedicated “home” for financial inclusion efforts can enable a city to sustain long-term financial inclusion programming for families. In NLC’s recent report on financial inclusion, based on the results of our in-depth scan of cities across the U.S., 29 percent of cities reported having a specific “home” to coordinate financial inclusion efforts, ranging from the designation of a single employee as the city lead for such programs to establishing a financial inclusion office, department or local coalition.

  • In 2005, Savannah, Ga., created Step Up Savannah, a nonprofit collaborative, to lead its efforts to reduce poverty in the city. Step Up Savannah has grown to encompass all of the city’s financial inclusion efforts. The organization convenes and provides resources to over 90 local partners, serving as the cornerstone of financial inclusion and guiding Savannah’s long-term vision of financial stability for all residents.
  • In 2006, New York City launched its Office of Financial Empowerment (OFE) within its Department of Consumer Affairs. The NYC OFE is the nation’s first municipal department specifically designed to educate, empower and protect low-income residents. While creating a new city department may not be a fast or easy option, it offers a long-term solution that ensures a streamlined approach to addressing residents’ financial challenges. Other cities, including Boston, Chicago, Columbia, S.C., Lansing, Mich. and San Francisco, have created similar offices.

Getting to the Goals
After developing a shared vision guided by an understanding of community needs, cities can establish measurable goals to implement their vision. Thirty-four percent of cities surveyed for our report indicated they have at least one citywide financial inclusion goal in place. Formal goal setting allows cities to monitor progress and ensures that impact can be measured.

CITIES_Figure12_webTo develop goals, cities can identify short- and medium-term objectives aligned with their long-term vision. Goals should be measurable, applicable and established collaboratively with stakeholders to ensure buy-in and accountability.

Citywide goals cited by survey respondents included tax returns completed through VITA sites and accounts opened through a Bank On program.

Virginia Beach, Va. Mayor William D. Sessoms, Jr. set a citywide goal to “connect 500 low-income families to mainstream financial institutions and help these families avoid foreclosure, avoid predatory lenders and stretch budgets in tough economic times, insuring they are financially fit for the future.”

Using Data to Guide Decision-Making
With the support of a strong champion, using data to develop a shared vision and measurable goals positions a city to implement financial inclusion programming that effectively addresses residents’ needs.

CITIES_Figure08_webNLC’s report revealed that 20 percent of the cities surveyed rely strongly on data to guide their financial inclusion efforts. Cities can collect data to identify residents’ needs through surveys, focus groups, or national data sets maintained by federal agencies such as the Census Bureau and the Internal Revenue Service.

Almost a third of cities surveyed conduct needs assessments, and over a third report asset mapping, both of which can help pinpoint and direct targeted resources to geographic areas of greatest need. Just as data is essential when developing a vision, it is equally important when evaluating programs and impact. Look out for a further discussion of evaluative data in a coming post!

Mara Heneghan
About the Author:
Mara Heneghan is a summer intern with the NLC Institute for Youth, Education, and Families. Contact Mara at heneghan@nlc.org.

City Leaders Champion Financial Inclusion Programs that Put Families First

This is the second post in a new blog series on financial inclusion. The series explains what financial inclusion is and provides examples and action steps to help city leaders start or strengthen financial inclusion efforts. This post focuses on the role of city leadership in using financial inclusion to help strengthen and provide a safety net for struggling families.

Boston Mayor Marty Walsh speaks to local residents at Christopher Columbus ParkBoston Mayor Marty Walsh speaks to local residents at Christopher Columbus Park. Credit: MattConti/NorthEndWaterfront.com walsh-pull-quote

As noted in the first post in this series, financial inclusion strategies are gaining momentum in cities across the country and making a difference in the lives of countless American families.

It’s no surprise that we’re seeing an uptick in the number of city leaders that are rallying behind innovative and proven programs that help low-to-moderate income residents to enter the financial mainstream.

NLC’s recent report, which highlights findings from a national scan of city leaders, found that 66 percent of cities surveyed reported having a mayor and/or city council member who designated financial inclusion issues as a ‘top’ or ‘high’ priority.

Figure03_builldingblocksFindings from our national scan also showed that cities in which financial inclusion is a high priority for elected officials have the greatest number of programs and/or activities operating in the community.

San Francisco Treasurer José Cisneros has made financial inclusion one of his highest priorities, claiming that his duty to safeguard San Francisco’s money also extends to improving the financial stability and well-being of the city’s residents. His leadership has turned San Francisco into a hub of innovation for financial inclusion programming, including Bank On San Francisco, PayDay Plus SF and more recently Kindergarten to College, all of which are being replicated in other cities across the country.

By promoting awareness of financial issues facing low-to-moderate income families, city leaders can use their bully pulpit to engage stakeholders and the public about the impact of financial challenges on families. City leaders are in a unique position to spearhead partnerships between city agencies, nonprofit organizations and private partners. By partnering with local stakeholders, Boston Mayor Martin J. Walsh launched Boston’s Office of Financial Empowerment to provide comprehensive financial inclusion services to the city’s diverse population.

Elected officials also report that financial institutions and foundations are more responsive to funding requests that demonstrate invested city leadership and broad stakeholder alignment. In 2008, Mayor John Hickenlooper (now Governor Hickenlooper) gained broad support when he formed the Denver Economic Prosperity Task Force, composed of 35 members representing local government, policy makers and community and business leaders, to coordinate the city’s response to residents’ economic challenges. Current Mayor Michael B. Hancock’s administration has continued to support financial inclusion, and has created the Denver Financial Empowerment Center.

In Memphis, Tenn., Mayor A C Wharton used his authority and status to create a task force of cross-sector stakeholders committed to reducing poverty in the city.

NLC’s report details additional ways city leaders are supporting programming in their cities, such as:

  • Making policy changes that promote financial inclusion,
  • Leading or supporting coalitions to align and connect the city’s efforts,
  • Giving the green light for financial support to launch or sustain financial inclusion programs, and
  • Explicitly dedicating staff time to financial inclusion by hiring a dedicated city employee or creating a new agency or financial empowerment center to house the city’s financial inclusion efforts.

Strong city champions who are willing to take action to start or strengthen financial inclusion programs are able to customize strategies to meet the needs of their residents, and often plant the seeds for innovation that can be replicated at the state or federal level. While municipal leaders are the linchpin to a successful financial inclusion city system, they cannot do it alone.

Mara Heneghan
About the Author:
Mara Heneghan is a summer intern with the NLC Institute for Youth, Education, and Families. Contact Mara at Heneghan@nlc.org.

Financial Inclusion Efforts Can Provide a Brighter Future for Low-Income Residents

This post was co-written by Courtney Coffin. Courtney is the senior associate for financial inclusion in the NLC Institute for Youth, Education, and Families.  

This is the first post in a new blog series on financial inclusion. This series will explain what financial inclusion is and provide examples and action steps to help city leaders start or strengthen financial inclusion efforts.

Money stairs - blogAs many city leaders can attest, recovery from the 2008 recession has been uneven in communities across the country. Many families remain financially vulnerable, unable to cover monthly bills or save adequately for emergencies.

The Corporation for Economic Development (CFED) found that 43 percent of U.S. households do not have a basic safety net — enough savings to cover basic expenses for three months — to weather emergencies such as a sudden job loss or medical crisis, or to prepare for future needs, e.g., a child’s college education or homeownership.

Additionally, a 2013 national survey from the Federal Deposit Insurance Corporation (FDIC) revealed that 28 percent of U.S. households either do not have a bank account at all, or do have one but also rely on alternative financial services such as payday loans or check-cashing services.

Individual and family financial instability jeopardizes the overall well-being of families and the health of local economies. Without financially stable residents, cities generate less money from property taxes and can lose revenue from unpaid public utility bills. Diminished health and education outcomes and higher foreclosure rates are also related to financial instability.

FI_QuoteConcern about the consequences of this instability has spurred many cities, including Columbia, S.C., Lansing, Mich., San Francisco and St. Petersburg, Fla., to implement robust financial inclusion strategies.

Financial inclusion strategies, such as Bank On programs, financial empowerment centers and children’s savings accounts, can bolster a city’s fight against poverty and help low-to-moderate income individuals and families move toward brighter, more economically secure futures.

NLC’s recent report, City Financial Inclusion Efforts: A National Overview, identifies seven key findings resulting from an in-depth scan of financial inclusion programs in cities across the U.S. The report explains the importance of city-led interventions to help families build financial stability, and highlights the role local elected officials and city leaders play in shaping innovative strategies to address the economic, public safety and personal concerns that are byproducts of family financial insecurity.

BUILDINGBLOCKSsmalltable_web-version_SorenA key finding from NLC’s scan was that financial inclusion strategies are best delivered through a comprehensive municipal framework built on strong city support, vision and leadership. Our report, which this blog series draws on extensively, illustrates that if key systems are in place, any city can become a major player in this arena.

The report and this blog series lay out an array of actions any city leader can take to leverage resources and expertise, regardless of a city’s level of experience with financial inclusion or related financial empowerment strategies. Each of the upcoming posts in this series will focus on one or two fundamental elements that the report offers as key building blocks for developing a city-led financial inclusion system.

Additionally, a guest post by a city leader from a community with a comprehensive financial inclusion program in place will highlight how these practices benefit residents, the local economy and the community overall.

Mara Heneghan
About the Author: Mara Heneghan is a summer intern with the NLC Institute for Youth, Education, and Families. Contact Mara at Heneghan@nlc.org.