The impact of COVID-19 on financial capability and asset building services.
The forced transition from in-person to online activities as a result of the COVID-19 pandemic has had a profound impact on how families and communities buy groceries, acquire medical care, and utilize social services. This rapid shift has raised important questions about how to address access and equity. AFN and the University of Wisconsin-Madison Center for Financial Security (CFS) conducted this study to better understand the transition to remote services among financial capability and asset building (FCAB) programs, which includes financial education, counseling, coaching, emergency assistance, benefits navigation, housing supports, workforce development, and other related services. The insights from this study can inform strategies for FCAB services going forward. This brief reviews recommendations for funders and organizations seeking to learn from the financial capability service delivery models employed in the COVID-19 pandemic, especially related to replication of findings that lead to more equitable delivery practices, improved accessibility of services, and greater financial improvements for clients. Six region-specific briefs complement the national findings - Indiana, Louisiana, North and South Carolina, Oregon, Texas, and Washington. This brief is generously supported by JPMorgan Chase & Co., MetLife Foundation, and Wells Fargo. If you missed the live webinar, watch the recording here.
Financial Coaching Initiative: Results and Lessons Learned
In 2015, the Consumer Financial Protection Bureau launched the Financial Coaching Initiative, a pilot program that provided financial coaching services to veterans and economically vulnerable consumers. Professional coaches were embedded into 60 host sites across the country, where they provided free, one-on-one help to consumers to address their personal financial goals. A range of organizations served as host sites, such as one-stop career centers, social services organizations, and legal aid groups. Over four years, the Financial Coaching Initiative served over 23,000 consumers, demonstrating that financial coaching can be successfully implemented at scale in many different settings for a wide range of consumers. This report and summary brief describe the basic structure of the Initiative, present data about the program’s results, and summarize key lessons learned for practitioners and organizations interested in coaching.
Government response to the Countervailing Power: Review of the coordination and funding for financial counselling services across Australia
In 2019, a comprehensive review (The Countervailing Power: Review of the coordination and funding for financial counselling services across Australia) of financial counselling services in Australia was undertaken and recommendations to ensure the long-term viability of the financial counselling sector, including the establishment of a nationally coordinated approach, and industry funding to strengthen the predictability and stability of funding for financial counselling were made. This document is the Australian Government's response to the review, outlining their response to each of the recommendations, and sets out their commitment to the following:
Countervailing Power: Review of the coordination and funding for financial counselling services across Australia
In 2019, the Australian Government committed to additional actions to improve the financial outcomes of Australians, including undertaking an immediate review of the coordination and funding of financial counselling services that disadvantaged Australians rely on. The review noted the benefits of financial counselling to the community, including early intervention and prevention of further financial hardship, advocacy support, and referral to other services for complex issues. The review also highlighted the challenges faced by the financial counselling sector, including increasing demand, fragmented delivery, and the array of complex situations and financial products that can lead to financial hardship. The review:
Investing in Financial Coaching with a Racial Equity Lens
In this moment, it is pivotal for philanthropy to support communities of color in achieving financial well-being. Combined with systems-change efforts that would create fairer economic opportunities and conditions, financial coaching is a vital component of providing needed support. Through background information, case stories, and key investment considerations, this brief focuses on financial coaching with a racial equity lens as an important strategy for helping people of color achieve equitable outcomes.
Real Money, Real Experts Podcasts
Real Money, Real Experts is a personal finance podcast written and produced by AFCPE (Association for Financial Counseling & Planning Education). Their membership community offers a place for financial counsellors and financial fitness coaches to share best practices, solve similar struggles, and access tools and resources. Recent episodes include the following topics:
Roadblock to Recovery: Consumer debt of low- and moderate-income Canadians in the time of COVID-19
Almost half of low-income households and 62 per cent of moderate-income households carry debt, with households on low incomes spending 31 per cent of their income on debt repayments, according to a new report published by national charity, Prosper Canada.
This report analyzes the distribution, amount and composition of non-mortgage debt held by low- and moderate-income Canadian households and explores implications for federal and provincial/territorial policy makers as they develop and implement COVID-19 economic recovery plans and fulfill their respective regulatory roles.
Debt settlement and financial recovery companies: too risky an option?
This report presents a study of the debt settlement and financial recovery industry and examines Canadian consumer issues from these services. Data is gathered from company websites and contracts as well as customer surveys and questionnaires completed by governmental and non-governmental organizations. A comparative study of legislation applicable to the industry is also conducted.
Meeting the Emergency Moment: Key Takeaways from Delivering Remote Municipal Financial Counseling Services
Local governments across the United States are working to help their residents weather the health and financial impacts of the COVID-19 pandemic. In many cities and counties, that means deploying their Financial Empowerment Centers (FECs), which provide professional, one-on-one financial counseling as a public service. Local leaders were able to offer FEC financial counseling as a critical component of their emergency response infrastructure; the fact that this service already existed, and was embedded into the fabric of municipal anti-poverty efforts, meant that it could quickly pivot to meet new COVID-19 needs, including through offering remote financial counseling. This brief describes how FEC partners identified the right technology; developed skills to deliver counseling remotely; messaged the availability of FEC services as part of their localities’ COVID-19 response; and shared lessons learned with their FEC counterparts around the country.
Client Engagement and Retention—The Secret Ingredient in Successful Financial Capability Programs
Grantmakers and practitioners recognize the importance of financial security for individuals and families, and many organizations therefore offer financial capability programs aimed at strengthening the financial well-being of the people they serve. But good financial capability programs are often high-touch and costly to provide for program administrators, and time consuming for clients to participate in. To benefit fully from such programs’ offerings, clients must actively participate in the program’s coaching, counseling, or other sessions, and engage in related activities to boost their financial health. Thus, understanding what drives client engagement is critical to helping programs improve program retention and outcomes, and concurrently, helps funders maximize the value of philanthropic dollars and customers’ time. Grantmakers concerned about best practices for funding effective financial capability efforts must therefore understand the vital role of client retention and the strategies for supporting the nonprofit sector to address this challenge. The brief explains the importance of client retention and engagement for financial capability program success, describes three key barriers to effective program participation, offers strategies to overcome those barriers, and closes with recommendations for philanthropy.
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Money Circle toolkit
Financial decisions are influenced by our own personal feelings and attitudes around money, and by the feelings, attitudes, and actions by our family and friends. This CFPB toolkit offers financial education practitioners three tools (Money Choices, Money Styles, and Money Network), each with a brief, interactive exercise, to initiate conversations about the feelings and personal relationships that shape financial choices.
Enterprise Communities Plus: A network of financial capability services in low-income housing developments in New York City
In early 2018, Enterprise Community Partners (Enterprise) began a pilot program, Enterprise Community Plus (EC+), to provide financial capability services to residents in two neighborhoods in New York City. Enterprise is a nonprofit housing developer seeking to create opportunity for low- and moderate-income people through affordable housing in diverse, thriving communities. The pilot program seeks to develop a network of service providers dedicated to supporting the housing developments and introduce rent reporting for credit building and matched savings accounts to residents. Prosperity Now joined the implementation process in May 2018.
In this brief, we provide some initial information on the participants that currently are enrolled in the program and some lessons learned to guide other organizations in their efforts to provide financial capability services into housing programs.
An Evaluation of Financial Empowerment Centers: Building People’s Financial Stability as a Public Service
This report is a three-year evaluation of the Financial Empowerment Center initiative’s replication in 5 cities (Denver, CO; Lansing, MI; Nashville, TN; Philadelphia, PA and San Antonio, TX). Financial Empowerment Centers (FECs) offer professional, one-on-one financial counseling as a free public service. The evaluation draws on data from 22,000 clients who participated in 57,000 counseling sessions across these first 5 city replication partners, and provides additional evidence of the program’s success.
Overview: Financial Empowerment Center Counselor Training Standards
This overview summarizes the Financial Empowerment Center (FEC) model’s Counselor Training Standards. The Standards delineate the breadth and depth of the financial content areas, counseling and coaching skills, practice and experiential learning, and socio-economic and cultural context setting necessary to serve the diverse needs and backgrounds of FEC clients. The Standards also include a Code of Ethics that promotes responsible, professional and ethical financial counseling, furthering the profession of one on-one financial counseling.
Resources
Handouts, slides, and time-stamps
Presentation slides for this webinar
Handouts for this webinar:
Brief: Matched Savings programs – webinar handout (Momentum)
Matched Savings programs chart – webinar handout (Momentum)
Budget Tracker – webinar handout (Credit Counselling Sudbury)
Monthly Budget – webinar handout (Credit Counselling Sudbury)
Time-stamps for the video-recording:
3:26 – Agenda and introduction
6:17 – Audience polls
9:41 – Reasons to save (Speaker: Glenna Harris)
12:08 – Effectiveness of Matched Savings (Speaker: Dean Estrella from Momentum)
32:10 – Savings strategies for clients on low incomes (Speaker: John Cockburn from Credit Counselling Sudbury)
47:50 – Q&A
Financial Coaching Program Design Guide: A Participant-Centred Approach
This comprehensive resource from Prosperity Now supports organizations in developing a participant-centered financial coaching program. Grounded in a field survey, over 100 interviews, expert advice and beta-testing with six new financial coaching programs, the Coaching Guide highlights the strengths and limitations of financial coaching, offers designs tools, showcases promising models and practices, and includes resources from program leaders and financial coaches.
An Evaluation of Financial Empowerment Centers Building People’s Financial Stability as a Public Service
This report provides information on the Financial Empowerment Center model, the people it served, the outcomes they achieved, the impact services had on nonprofit and city partners, and lessons learned for others looking to replicate or support this model. The evaluation was designed as a utilization-focused, foundational and exploratory study, aimed at creating an evaluation report that was useful to stakeholders. The report includes both qualitative and quantitative sources
A Much Closer Look: Enhancing Savings Counseling at Financial Empowerment Centers
Building savings is a fundamental strategy for empowering individuals and families with low incomes. Even relatively small amounts of savings can serve as a buffer against inevitable financial shocks that can otherwise undermine social service efforts and successes – and short-term savings offer realistic first steps toward building longer-term savings and acquiring assets. The CFE Fund conducted a research pilot at municipal Financial Empowerment Centers to better understand how clients are saving, and inform new savings indicators for financial counseling success. This report explains the insights of this research pilot, and client outcomes in savings and goal setting.
Financial Empowerment: Improving financial outcomes for low-income households
Financial Empowerment is a new approach to poverty reduction that focuses on improving the financial security of low-income people. It is an evidence-driven set of interventions that have proven successful at both eliminating systemic barriers to the full financial inclusion of low-income people and providing enabling supports that help them to acquire and practice the financial skills and behaviours that tangibly improve their financial outcomes and build their financial security. The Financial Empowerment approach focuses on community level strategies that encompass five main types of interventions that have been identified as both necessary for low-income households to improve their financial outcomes, and effective at helping them to do so.
Financial Coaching: An Asset-Building Strategy
Financial coaching is a promising strategy to help people improve their financial well-being, but is often not yet universally understood. Practitioners are turning to coaching strategies to better facilitate behaviour change as opposed to the disappointing results often found when only financial education or financial access programs are introduced. Shared insights on financial coaching can help shape collective action by funders seeking to facilitate greater financial capability among targeted populations.
