April 19, 2018
I was waiting until it really felt like spring before writing the Spring 2018 newsletter, but it seems like I’ll be waiting forever, so here it is, better late than never.
Welcome to the 9th CT Asset Building Collaborative (CABC) newsletter. Read on to find out more about local events and news, as well as key research findings and national news that affects us and our work. Don’t forget to follow us on facebook and twitter for all the latest news and events!
News you can use
YMYG training focusing on Re-Entry – 22nd May
People returning to the community after incarceration often face financial difficulties related to overwhelming debt/arrears, low credit scores/identify theft, and problems with banks and money management. The United Way is offering a FREE one-day Your Money Your Goals training for people working with the re-entry population. The day-long training will be held on Tuesday 22nd May at the New Haven Opportunity Center at 316 Dixwell Avenue. Each trainee will receive a free Your Money Your Goals manual, with a companion guide specifically focused on reentry issues. Breakfast and lunch will be provided. Please register here uwgnh.org/money, or contact Ellie Meise-Munns, 203-691-4205, or Joy Duva at [email protected].
Andrea Levere speaking at CAHS event on "Building Inclusive Pathways to Prosperity"
The Connecticut Association for Human Services is hosting a fundraising event Monday, May 14, 5:00-7:30 pm at West Hartford Town Hall, with good food and drink, compelling speakers, including Andrea Levere of Prosperity Now and worthy honorees. The funds raised will support CAHS’s work across the state helping move children and families out of poverty and toward financial stability. For further details contact Jim Horan at [email protected], or purchase tickets here.
Financial Reality Fairs
The Credit Union League of Connecticut organizes financial reality fairs for high school students. Students choose a career, research the schooling required and the starting salary. They are given a budget sheet, randomized credit score, student loan debt and credit card debt, and they go through the simulation from there, acquiring items like food, clothing, transportation, housing, cell phones, internet, night life and more! See this video for more information. If you're interested in learning more, observing or volunteering for a morning, please contact Dave Hinchey at [email protected]. Upcoming dates are April 25th in Torrington and April 27th in Hartford.
ABC Peer Learning Event
The ABC Peer Learning Event focusing on Savings was held at the CT Food Bank on February 21st. The presentations were very informative, and there was great discussion about how to use the EARN Saver Life savings program to integrate savings strategies with other services. A number of the attendees signed up to continue to be involved in taking the work beyond discussion to actions and results. Please contact Michelle McCabe [email protected] or Dave Hinchey at [email protected] if you are interested in getting involved!
The latest news and research that matters
Prosperity Now Scorecard out
Take a look at the latest Prosperity Now scorecard, and download information from where you live about financial assets, income, businesses and jobs, homeownerships and housing and more. Also take a look at their important article showing how the tax code continues to benefit the wealthy, with families of color falling further behind; this related working families article documents the continued growth in inequality in the United States.
Many Americans struggle to afford rent. The results are clear in this amazing new resource just released by Princeton University’s Eviction Lab, showing eviction data for the entire nation; you can search your own region, town, and even census tract. Waterbury, Hartford and Bridgeport are in the top 50 evicting towns in the nation, with New Haven not far behind at #69. This report documents the nationwide housing affordability crisis experienced by people with disabilities, particularly those who rely on Supplemental Security Income (SSI); in many states, the average monthly rent for a one-bedroom apartment is more than the entire monthly income of a person on SSI.
Truly disturbing research by the National Fair Housing Alliance found that the Auto-loan industry systemically discriminates against consumers of color, just as the House of Representatives gets ready to vote on a bill weakening regulation of this sector. Non-Whites seeking auto-loans are routinely offered worse terms than Whites, regardless of credit scores.The research confirms similar findings from a study carried out a few years ago by the National Consumer Law Center; that study found that Black borrowers in Connecticut were routinely charged markups on auto loan rates 279% higher than whites.
Inequality in the Fintech landscape
I wrote in the last newsletter about ways in which Fintech could be used to serve low-income people. However good these tools are, they require access to the internet, and usually a smartphone. But a new study finds a surprisingly high lack of access to either – in the average community, 67% of adults have high-speed internet access at home and only 40% own a smartphone. Clearly much more needs to be done to ensure that everyone has access to the financial technology that is becoming the norm in banking and financial management.
The Criminalization of Private Debt
One in three Americans has a debt that has been turned over to a private collections agency. For some, this can end in jail time, when collection agencies ask judges to issue arrest warrants for people who fail to appear in court to deal with unpaid civil debt judgments. The ACLU, who produced a recent report on the subject, recommends limiting the ability of courts to issue arrest warrants in debt cases, and creating rules to prevent debt collectors from seeking the arrest of debtors.
CFPB dismantling of payday lender regulations
In the last newsletter I drew your attention to the problems faced by the Consumer Financial Protection Bureau (CFPB), and the risk that the new Director, Mick Mulvaney may take it in a very different direction. Unfortunately, over the past few months, that predication has begun to be realized. One particularly alarming development is the pulling back by the CFPB of crucial regulations on payday lenders.
Banks may be able to get into the deposit-advance business again
While payday lenders are getting some slack, banks will also now find it easier to get into the short-term, small loan market. In the past, some banks offered deposit-advance products, which, like payday loans, had payments taken automatically from the borrower’s next paycheck. Though interest rates were lower than payday loans, they were still around 200-300% APR, much higher than the commonly accepted maximum APR of 36% for consumer loans. During the Obama administration, limits were put on banks’ ability to offer advance-deposit loans, but now things are moving in the opposite direction, with a bill passed exempting banks from rules that apply to payday lenders. See here for a discussion of the risks associated with allowing banks to offer these costly products.
Financial literacy training won’t help Medicaid beneficiaries
The state of Kentucky is considering requiring people who lose Medicaid due to the new work requirements to take financial literacy training to get back on Medicaid more quickly. Financial literacy training can certainly be useful for many people, regardless of their income levels. But it is no panacea and requiring it may simply add a burden to people who are mostly likely already extremely stressed. As this NPR story explains, the main reason why poor people do badly with their finances, is because it is really, really difficult to manage on too few resources!
Greater protection for people with representative payees
In March, the “Strengthening Protections for Social Security Beneficiaries Act,” also known as H.R. 4547 was passed, which will strengthen the Social Security Administration’s Representative Payee program, which assigns payees to recipients of Social Security Disability beneficiaries – Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI) – who are determined incapable of managing their funds, to ensure their basic needs are met. HR 4547 will improve oversight and monitoring of the approximately 5 million payees in the country, in order to decrease instances of financial exploitation and abuse.
I’m writing this from Washington DC, where I’m attending the 5th National Age-Friendly Banking Convening. Older adults, particularly those with low incomes, are often vulnerable to financial abuse and fraud, and often don’t have their needs met by traditional banking products. Age-Friendly banking includes having mechanisms in place to protect seniors from fraud, and customizing financial products to meet their needs, such as allowing a third party to view, but not make transactions. A toolkit has been developed to help banks and communities do the right thing for older adults.