Gathering a Roundtable

As part of our continued savings work with Prudential Financial, we hosted two sets of virtual roundtables with a diverse set of practitioners from across the country. We opened applications for anyone in our Savings Network to join us for the roundtables. We gathered the selected participants for a discussion focused on these main objectives:

1. Identifying how savings needs, priorities and barriers have shifted over the past year.
2. Understanding the state of savings programs and how they have been adapted to meet clients’ needs.
3. Generating solutions to support savings as we continue through the COVID crisis and look toward the future.

Before we share our takeaways, we would like to thank all the roundtable participants for engaging in our discussion. These practitioners understand and advocate for their clients brilliantly while also envisioning a prosperous future in savings.

What We Heard

First, the pandemic reinforced the fact that having little-to-no income greatly reduces the possibility of savings. If people remain unemployed or they are not earning enough for a living wage they will be hindered in their savings. Only an increase in cash flow can change their financial situation. Practitioners told us that their clients fall between “two polar ends.” On one end are those who are unemployed, have no benefits or stimulus payments and are barely hanging on. On the other end are those who are working, have manageable expenses, are receiving benefits or stimulus to increase savings and are seeking asset acquisition. Yet we know this spectrum does not capture all situations or the complexity of experiences during the pandemic.

Second, despite the pandemic, clients are saving. Yet low-income families and communities of color still face major barriers to savings. Practitioners confirmed that most clients have continued saving despite a dip in income, mistrust in financial institutions and fear of losing public benefits. The challenge is they are forced to choose alternative methods of savings, whether informally or via other financial methods such as credit cards or relying on predatory lending products, especially when emergencies arise.  

Third, savings programs are re-designing their services to help clients save more holistically. Moreover, many programs are rethinking their role in helping clients save and increase wealth by removing barriers and requirements to their programs, especially in match savings. The events from the last year have required programs to realign their services to community needs.

Lastly, many practitioners reported various concerns about recovery of clients’ financial status. These vary from older folks worried about their used-up retirement savings to those left out of the stimulus package. Programs are observing low morale in clients when discussing their finances and recognize that many clients' main need is cash infusions to re-start savings.

The Future is Now

One of the questions we asked roundtable participants to take home and ponder was, “If you had a magic wand which could give you up to three wishes to support savings in your community, what policy, program or institutional changes would you make?” Our hope was to hear more ideas, big or small, programmatic or policy, and all the in-between from the people most connected to the clients. We were not disappointed with the answers! The roundtable attendees were brilliant, and all had so many ideas, so we decided to uplift a few here:

1. Government intervention in the form of:
   1. Removing asset limits for those receiving public benefits (this was the most requested),
   2. Eliminating student loan debt (also highly requested),
   3. Providing families with children with a universal basic income,
   4. Expanding the EITC child tax credit and increasing the income threshold,
   5. Strengthening government regulation of predatory loans and lending practices,
   6. Offering one large platform for those receiving food assistance, that is transferable to other states and can identify eligibility for other services.
2. Programmatic interventions would include:
   1. Converting the amount people are in bad debt to a savings account,
   2. Offering workforce programs that give employees benefits to use a savings program with decent return on investment, and
   3. Requiring all non-profits to focus on financial well-being to have access to matched savings.
3. Institutional interventions would include:
   1. Removing guidelines/rules that deter undocumented folks from opening bank accounts,
   2.  Connecting new immigrants to financial coaches,
   3. Providing more affordable housing for families that are displaced,
   4. Paying seed money into CSA/Baby Bond accounts for low-income children and offering incentives to not utilize the funds prematurely.
4. Financial education for all low-income individuals would come:
   1. Via our education system,
   2. In the form of a two-generational approach, and
   3. Targeted toward new immigrants and students to help them understand the financial system better.

This list highlights how different programmatic, institutional, and policy changes can influence the savings sphere. We need to think broadly and outside the box about how to remove savings barriers and increase opportunities to help build wealth for low-income and communities of color.