A couple of weeks ago, I happened to stumble upon a free, downloadable resource that I want to share with REAL Solutions leagues and credit unions. It’s called the Assets & Opportunity Scorecard, and it’s published by the Corporation for Enterprise Development (CFED), a pioneer in asset-building. This tool provides a comprehensive profile of the financial security of households and individuals – nationwide and by state – based on 58 outcome measures that describe how well residents are faring in terms of building and protecting assets. These 58 measures are organized into five issue areas:
- Financial Assets & Income
- Businesses & Jobs
- Housing & Homeownership
- Health Care
For each measure, your state’s ranking is provided, along with the actual data and its national comparison. Some of the most useful information items – the asset poverty rate, income poverty rate, unbanked households, and net worth (by race, income and gender) – illustrate the reasons why your credit union needs to serve low-wealth markets. In addition, measures such as microenterprise ownership rate, mortgage debt as a percent of home value, median credit card debt, median installment debt, and average college graduate debt provide you with solid data to inform and stimulate product/service innovations.
Nationally, 23% of households are “asset poor.” This means that they don’t have sufficient net worth to subsist at the poverty level for three months without absence of income. What’s more, 27% of households with children are asset poor. Sadly, this figure increases to 41% among minority households with children.
In addition, 14% of all households and 24% of minority households suffer extreme asset poverty. This means they have zero or negative net worth (i.e., no savings or assets whatsoever to help buffer against financial hardship). Consider that these figures are derived from surveys conducted before the great recession, and one can only imagine the gravity of the current situation.
The “opportunity” section of these profiles provides an assessment of how well states support efforts of residents to build and protect assets using 34 policy measures. Public policy advocates will find this section equally interesting and informative with its emphasis on IDA program support, payday lending protections, microenterprise support, and predatory mortgage lending protections.