Center on Assets, Education, and Inclusion

  1. Preventive policy strategy for banking the unbanked: Savings accounts for teenagers

    Citation

    Friedline, T., Despard, M., & Chowa, G. (2015). Preventive policy strategy for banking the unbanked: Savings accounts for teenagers? Journal of Poverty.

    Authors

    Friedline, Terri, Despard, Mathieu R., Chowa, Gina A.N.

    Financial Inclusion Journal Article Year 2015

  2. Quarterly Newsletter Dec 2015

    Authors

    AEDI

    Newsletter Year 2015

  3. Quarterly Newsletter Jan 2015

    Authors

    AEDI

    Newsletter Year 2015

  4. Quarterly Newsletter May 2015

    Authors

    AEDI

    Newsletter Year 2015

  5. Quarterly Newsletter Sept 2015

    Authors

    AEDI

    Newsletter Year 2015

  6. Savings Account: Protection from Unsercured Debt

    Debt is an important component of young Americans’ balance sheets, in part because the effects of different types of debt can vary widely: while some types of debt can contribute to lifetime economic mobility, other types can drain resources. This paper used data from the 1996 Survey of Income and Program Participation to consider the role that a savings account might play in the use of secured and unsecured debt by young adult households. While a savings account was related to more accumulated debt overall, the type of debt accumulated was less risky and potentially more productive. Owning a savings account was associated with a 15% increase, or $7,500, in the value of secured debt and a 14% decrease, or $581, in the value of unsecured debt. Thus, a savings account may help young adults “invest in their debt” by entering better, healthier credit markets and protecting them from riskier ones.

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    Authors

    Friedline, Terri, Freeman, Allison T

    Financial Inclusion Working Paper Year 2015

  7. The Landscape of Millennials' Financial Capability

    This study, generously funded by the FINRA Investor Education Foundation, examined the financial health and capability of Millennial young adults between the ages of 18 and 34 (N = 6,865) from the 2012 National Financial Capability Study (NFCS). In particular, this study explored how varying combinations of financial education and financial inclusion related to Millennials' financial behaviors, like saving for emergencies, using alternative financial service providers, and carrying debt. The 2012 NFCS is one of the few data sets with extensive questions about financial behaviors. The results identifying significant differences in the data were based on multiply imputed and propensity score weighted (average treatment effect for the treated; ATT) regression analyses of young adults in the sample.

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    Citation

    Friedline, T., & West, S. (2015). The landscape of Millennials’ financial capability (AEDI Research Brief). Lawrence, KS: University of Kan-sas, Center for Assets, Education, and Inclusion.

    Authors

    Friedline, Terri, West, Stacia

    Financial Inclusion Brief Year 2015

  8. The Potential for Savings Accounts to Protect Young Adult Households from Unsecured Debt

    The effects of different types of debt can vary widely: some debt is considered productive by advancing young adult households' financial health while other debt can be unproductive, pushing their financial health out of reach. A savings account may help young adult households reduce their reliance on unproductive debt and increase their access to productive debt that can facilitate wealth building and economic mobility. This study tests the association between a savings account and debt in the lives American young adults during periods of macroeconomic stability and decline. Owning a savings account in 1996 is associated with a 14% decrease ($844) in young adult households’ accumulated unsecured debt, while closing an account in 2008 is associated with a 12% increase ($1,320) in this type of debt. Overall, a savings account may help young adults “invest in their debt” by entering better, healthier credit markets and protecting them from riskier ones—especially during bad economic times. Policy interventions are needed that increase access to savings accounts and help young adult households to use debt productively.

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    Citation

    Friedline, T., & Freeman, A. (2015). The potential for savings accounts to protect young adult households from unsecured debt in periods of macroeconomic stability and decline (AEDI Research Brief). Lawrence, KS: University of Kansas, Center on Assets, Education, and Inclusion.

    Authors

    Friedline, Terri, Freeman, Allison T

    Financial Inclusion Brief Year 2015

  9. The Real College Debt Crisis: How Student Borrowing Threatens Financial Well-Being and Erodes the American Dream

    Citation

    Elliott, W. and Lewis, M. (2015). The Real College Debt Crisis: How Student Borrowing Threatens Financial Well-Being and Erodes the American Dream. Broomfield, CO: Praeger.

    Authors

    Elliott III, William, Lewis, Melinda

    College Debt Book Year 2015

  10. The relationship between income and net worth in the U.S.A

    Citation

    Rauscher, E. and Elliott, W. (2015). The relationship between income and net worth in the U.S.A: Virtuous cycle for high but not low income households. Journal of Poverty

    Authors

    Rauscher, Emily, Elliott III, William

    Wealth Transfer Journal Article Year 2015

  11. Transforming 529s into Children's Savings Accounts (CSAs): The Promise Indiana Model

    State 529 plans are tax-preferred vehicles for post-secondary education saving, administered by states, usually through contractual agreements with private financial institutions. In large part, 529s have served to intensify the distributional advantages that already accrue to more economically-privileged households. However, a small, but growing number of states are attempting to transform their 529 programs into Children’s Savings Accounts (CSAs) programs so that they better serve children and families disadvantaged economically and educationally. However, there has been little discussion about what might differentiate a CSA program administered through a 529 from a standard state 529 program. Using the case of Promise Indiana’s 529-based CSA as an example, this paper outlines what we believe to be some of the critical elements of Children’s Savings Accounts and the ways that they may help to change the distributional consequences of our current educational and economic systems, such that they facilitate, rather than frustrate, the aspirations of disadvantaged children. The paper traces the origins and evolutions of Promise Indiana, within a discussion of components of 529-based CSAs, identifies design features that align with Identity-Based Motivation, outlines the rationale for a wealth transfer within CSAs, and shares lessons for replication. The Promise Indiana’s model may be relevant in other parts of the country, particularly as communities consider how to address imperatives related to educational attainment gaps and rising student indebtedness, as well as their implications for upward mobility and broader prosperity.

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    Authors

    Lewis, Melinda

    Children's Savings Account Report Year 2015

  12. Wealth as security: Growth curve analyses of household income and net worth during a recession

    Building on evidence of increasing inequality with the 2008–2009 recession, we asked whether households experienced different financial trajectories through the recession depending on initial income and net worth. Using growth curve models of households headed by young adults in the Panel Study of Income Dynamics, we compared the relationship between initial income and net worth and the rate of change of income and net worth from 1989 to 2011 among households with income above and below $50,000. We found different patterns of income change and different relationships among income, net worth, and their rates of change between high- and low-income categories. Results suggest initial wealth helped to stabilize income and wealth changes among higher income households, reducing financial insecurity.

    Citation

    Rauscher, E. and Elliott, W. (2015). Wealth as security: Growth curve analyses of household income and net worth during a recession. Journal of Family and Economic Issues, March.

    Authors

    Rauscher, Emily, Elliott III, William

    Wealth Transfer Journal Article Year 2015

  13. Why America Students are struggling with - and defaulting on - small debts

    Student loan balances climbed to $1.2 trillion at the end of 2014, and delinquencies are rising even as they fall for most other types of debt. In fact, students with the smallest balances are most likely to default. Judy Woodruff learns more from Megan McClean of the National Association of Student Financial Aid Administrators and William Elliott of the University of Kansas.

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    Authors

    Woodruff, Judy

    College Debt Multimedia Year 2015

  14. Young Adult's Race, Wealth, and Entrepreneurship

    The current young adult generation is expected to lead a resurgence in entrepreneurial activities in the United States and these activities are expected to drive economic growth in the coming years. However, young adults may find it difficult to fulfill the expectations of becoming entrepreneurs and drivers of economic growth. This is because entrepreneurial opportunities are typically reserved for the wealthiest and most privileged Americans who have the financial resources needed to invest in starting small businesses, such as savings and access to credit. In contrast, young adults have not had much time to save money, build credit, or accumulate wealth. Moreover, given historic wealth inequalities rooted in racism and discrimination, young adults from racial and ethnic minority groups may be left out of the entrepreneurial resurgence and its economic benefits. This study analyzes nationally representative, longitudinal data to addresses the questions of whether young adults' wealth can support their entrepreneurial activities by becoming self-employed and whether black and Latino/a young adults leverage their wealth differently to support their entrepreneurial activities. Generally, the probability of being selfemployed;increases for all young adults as they accumulate wealth. However, wealth may play an outsized role in the self-employment of black and Latino/a young adults. Black and Latino/a young adults may not be able to rely on taking out a small loan at a bank or credit union in order to open their business; instead, they may be forced to use their own limited wealth for pursuing entrepreneurship. Policies are needed that support wealth accumulation (particularly for racial and ethnic minorities), remove discriminatory lending practices, and provide young entrepreneurs with access to credit.

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    Citation

    Friedline, T., & West, S. (2015). Young adults' race, wealth, and entrepreneurship (AEDI Research Brief). Lawrence, KS: University of Kansas, Center on Assets, Education, and Inclusion.

    Authors

    Friedline, Terri, West, Stacia

    Financial Inclusion Brief Year 2015

  15. Young Adults' Race, Wealth, and Enterpreneurship

    This study explored relationships among young adults’ wealth and entrepreneurial activities with emphasis on how these relationships differ among racial and ethnic groups. Using data (N = 8,984) from the 1997 National Longitudinal Survey of Youth, results indicate that being Black or Latino/a, as well as liquid asset holdings and net worth, were significantly related to the likelihood of self-employment. In analyses disaggregated by race or ethnicity, greater liquid asset holdings were associated with the decreased likelihood of self-employment among white young adults. Black young adults’ greater debt and net worth were associated with increased likelihoods of entrepreneurial activity. Among Latino/a young adults, greater liquid asset holdings and net worth were associated with increased likelihoods of self-employment. Wealth may play an outsized role in the self-employment of black and Latino/a young adults compared to that of their white counterparts. Racial and ethnic minority young adults may have a heavier burden for generating their own capital to embark on entrepreneurial activities when mainstream credit markets are unresponsive or inaccessible. Policy implications are discussed.

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    Citation

    Friedline, T., & West, S. (2015). Young adults' race, wealth, and entrepreneurship. Lawrence, KS: University of Kansas, Center on Assets, Education, and Inclusion.

    Authors

    Friedline, Terri, West, Stacia

    Financial Inclusion Working Paper Year 2015

  16. Assets and African Americans: Attempting to capitalize on hopes for children through college savings accounts

    Although some racial inequalities have lessened in the half-century since the passage of the first major civil rights legislation, the racial wealth gap remains and in recent years seems to be widening. Households with children are the least likely to be asset secure or have sufficient resources to enable investment in opportunities for mobility. Viewing inequality from this perspective indicates that what households are able to save and invest for the future might have a more lasting impact on the life chances of children than their current income and consumption. Summarizing data from the Saving for Education, Entrepreneurship, and Downpayment (SEED) Initiative, a quasi-experimental study that is part of a national demonstration of Child Development Accounts (CDAs) in the United States, this paper describes how African-American households engage with one important investment opportunity - college savings accounts for their pre-school children. Combining account monitoring, survey, interview and focus group data, we explore the reasons that many households chose not to open accounts or invest their own money. We offer suggestions for making asset development programs viable for low-income African-American families and their children.

    Citation

    Shanks, T., Nicoll, K., & Johnson, T. (2014). Assets and African Americans: Attempting to capitalize on hopes for children through college savings accounts. The Review of Black Political Economy, 41 (3) 337-356.

    Authors

    Johnson, Toni, Shanks, Trina R., Nicoll, Kerri Leyda

    Children's Savings Account Journal Article Year 2014

  17. Child development accounts

    Citation

    Elliott, W. and Lewis, M. (2014). Child development accounts (CDAs). The Encyclopedia of Social Work.

    Authors

    Lewis, Melinda

    Children's Savings Account Encyclopedia Year 2014

  18. Examining the Canadian Education Savings Program and its Implications for U.S. Child Savings Account (CSA) Policy

    While we believe that there are significant lessons to be learned from the Canadian experience with education savings programs, as the United States moves towards more comprehensive Children’s Savings Account (CSA) policy, we begin with the perhaps obvious acknowledgement that there are some noticeable differences in the political, educational, and economic contexts of Canada and the United States. For example, in 2011, Canada ranked first in overall post-secondary education (PSE) attainment among OECD countries, with more than 50% of adults ages 25 to 64 having some PSE credentials (Kenney, 2013), while the U.S. ranks 14th, with 42% attainment (OECD, 2012). Perhaps related, economic mobility rates—the likelihood that a child born into poverty will not stay in poverty as an adult—are far higher in Canada than in the U.S. (Corak, 2010). Analysis finds that a son raised in the bottom decile in Canada has about the same chances of reaching the top half of the earnings distribution as a third-decile son in the United States; being Canadian instead of American, then, provides as much of a mobility advantage as being born into a family three times more prosperous (Corak, 2010). Although income inequality is increasing in Canada, the distribution of economic advantage is still far more equitable than in the United States (Corak, 2010). This is transmitted to the PSE arena, as well, where the income attendance gap is smaller than in the U.S. (Belley, Frenette, & Lochner, 2011). Despite these and many other differences, there are enough similarities between the Canadian Education Saving Program (CESP) and, particularly, state-sponsored 529 savings programs in the U.S. that each can still inform the other in important ways.

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    Citation

    Lewis, M. and Elliott, W. (2014). Lessons to learn: Canadian insights for U.S. children’s savings account (CSA) policy. Lawrence, KS: Assets and Education Initiative (AEDI).

    Authors

    Lewis, Melinda

    Children's Savings Account Report Year 2014

  19. Extending savings accounts to young people: Lessons from two decades of theory and research and implications for policy

    Citation

    Friedline, T. (2014). Extending savings accounts to young people: Lessons from two decades of theory and research and implications for policy. In R. Cramer & T. Williams Shanks (Eds.), The assets perspective: The rise of asset building and its impacts on social policy (pp. 203–223). New York, NY: Palgrave MacMillan.

    Authors

    Friedline, Terri

    Children's Savings Account Chapter Year 2014

  20. Harnessing Assets to Build an Economic Mobility System: Reimagining the American Welfare System

    Harnessing Assets to Build an Economic Mobility System provides new empirical insights that help to explain what so many Americans intuitively grasp, and what U.S. policy debates so studiously ignore: Upward economic mobility and a chance at financial security are slipping beyond the grasp of many households. This report examines the drivers of mobility by distinguishing between standard of living, which is related to consumption and available income, and economic mobility and wellbeing, which require assets in addition to income and fuel multiplier effects. The former is supported by the consumption-based welfare system, including programs such as Temporary Assistance for Needy Families (TANF) and the Supplemental Nutrition Assistance Program (SNAP; formerly food stamps), which is designed to help households exit poverty and consume at a level consistent with a near-poverty level. Upward mobility and wellbeing is advanced by an asset-based welfare system, largely made up of tax credits and deductions that helps more advantaged Americans accumulate assets. By highlighting the significance of assets for achieving economic mobility and true wellbeing, this analysis emphasizes the importance of building policy structures capable of helping households generate assets, not just increase income. The report proposes Economic Mobility Accounts—tax-advantaged savings accounts that help Americans of all income levels save and accrue assets across the life course—as a policy structure that may once again make upward mobility accessible to all Americans.

    Citation

    Elliott, W. and Lewis, M. (2014). Harnessing Assets to Build an Economic Mobility System: Reimagining the American Welfare System. Lawrence, KS: Assets and Education Initiative (AEDI).

    Authors

    Elliott III, William, Lewis, Melinda

    Wealth Transfer Executive Summary Year 2014

  21. Harnessing Assets to Build an Economic Mobility System: Reimagining the American Welfare System

    Harnessing Assets to Build an Economic Mobility System provides new empirical insights that help to explain what so many Americans intuitively grasp, and what U.S. policy debates so studiously ignore: Upward economic mobility and a chance at financial security are slipping beyond the grasp of many households. This report examines the drivers of mobility by distinguishing between standard of living, which is related to consumption and available income, and economic mobility and wellbeing, which require assets in addition to income and fuel multiplier effects. The former is supported by the consumption-based welfare system, including programs such as Temporary Assistance for Needy Families (TANF) and the Supplemental Nutrition Assistance Program (SNAP; formerly food stamps), which is designed to help households exit poverty and consume at a level consistent with a near-poverty level. Upward mobility and wellbeing is advanced by an asset-based welfare system, largely made up of tax credits and deductions that helps more advantaged Americans accumulate assets. By highlighting the significance of assets for achieving economic mobility and true wellbeing, this analysis emphasizes the importance of building policy structures capable of helping households generate assets, not just increase income. The report proposes Economic Mobility Accounts—tax-advantaged savings accounts that help Americans of all income levels save and accrue assets across the life course—as a policy structure that may once again make upward mobility accessible to all Americans.

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    Citation

    Elliott, W. and Lewis, M. (2014). Harnessing Assets to Build an Economic Mobility System: Reimagining the American Welfare System. Lawrence, KS: Assets and Education Initiative (AEDI).

    Authors

    Elliott III, William, Lewis, Melinda

    Wealth Transfer Report Year 2014

  22. Households' net worth accumulation patterns and young adults' financial well-being: Ripple effects of the Great Recession

    We examined households’ dynamic patterns of net worth accumulation between 1999 and 2009 and asked whether these patterns related to the financial health of young adults growing up in those households. Two patterns of net worth emerged—the first remained high and stable and the second experienced a precipitous decline between 2007 and 2009. Young adults who grew up in households with high and stable net worth also experienced the greatest benefit in financial health. Given wealth losses in the wake of the Great Recession and the ripple effects those losses may have had—and may continue to have—on households and their children, policies that stimulate wealth accumulation may be feasible and timely strategies for improving financial health.

    Citation

    Friedline, T., Nam, I., & Loke, V. (2014). Households' net worth accumulation patterns and young adults' financial well-being: Ripple effects of the Great Recession? Journal of Family and Economic Issues, 35, 390-410.

    Authors

    Friedline, Terri, Nam, Ilsung, Loke, Vernon

    Wealth Transfer Journal Article Year 2014

  23. If you build it, will they save? The Canadian Education Savings Program through a Children's Savings Account Lens

    In this webinar presentation, we'll be answering 3 core questions: Why Canada and why now? What are CSAs and what are they intended to achieve? What can we learn about CSA programming and policy design by looking at Canada's experience?

    Authors

    Lewis, Melinda, Black, Rachel

    Children's Savings Account Multimedia Year 2014

  24. Investing in children: Child Development Accounts as an early childhood intervention

    Child Development Accounts (CDAs)—specially designed accounts opened in children’s own names—are a preventive, economic intervention that can complement investments made by existing early childhood interventions and advance their mission of helping children reach their full potential. Poverty is an inhibitor of children’s opportunities for educational and economic advancement. Federal, state, and local governments have dedicated substantial resources to mitigating the effects of poverty. CDAs are a complementary strategy with great potential but one that is underutilized. The positive outcomes of CDA ownership and development can be supported by appropriate policy design and by providing appropriate, intentional preparation to children about their CDAs.

    Citation

    Friedline, T., & Schuetz, N. (2014). Investing in children: Child Development Accounts as an early childhood intervention. Washington, DC: New America Foundation.

    Authors

    Friedline, Terri, Schuetz, Nik

    Children's Savings Account Brief Year 2014

  25. Lessons to learn: Canadian insights for U.S. children’s savings account (CSA) policy

    Related items: Examining The Canadian Education Savings Program and Its Implications for U.S. Child Savings Accounts (CSA) Policy Webinar: Canadian Savings Education Report

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    Citation

    Lewis, M. and Elliott, W. (2014). Lessons to learn: Canadian insights for U.S. children’s savings account (CSA) policy (AEDI Brief 01-14). Lawrence, KS: Assets and Education Initiative (AEDI).

    Authors

    Lewis, Melinda, Elliott III, William

    Children's Savings Account Brief Year 2014