SACRAMENTO - The California Legislature today took a historic first step toward becoming a positive force that will help rebuild and protect wealth for all Californians. For the first time at the state level, a bipartisan legislative Select Committee on Financial Empowerment will explore the broad public policy and legislative opportunities to expand savings, and asset ownership in California.
Assembly member Ricardo Lara (D-Bell Gardens) is Chair of the Committee, which will formally institutionalize within the State Legislature the work to develop an agenda devoted to building savings for education, retirement, entrepreneurship, homeownership, and security against economic crises.
"During these times of economic uncertainty, a person's ability to go from mere subsistence to obtaining financial stability, prosperity and success relies on their ability to build and protect assets," said Assemblyman Lara. "It is imperative that policymakers re-examine traditional strategies for helping people out of poverty. Low-income working families may need essential services and resources in the short-term; however, policies that promote and reinforce long-term financial stability and independence should be our priority."
The need for policies that promote wealth building is clear: thirty percent of Californians lack enough savings to get by for three months in the event of a job loss or medical emergency. Asset poverty is twice as pervasive as the income poverty rate and arguably more consequential.
"We give Assemblyman Lara and the state legislature our sincerest commendation for their forward-looking vision, leadership, and recognition of the need to address the financial challenges facing hardworking Californians," said Olivia Calderon, California Legislative Director of the New America Foundation. "It is long-overdue and well-deserved that the Legislature formally address issues such as asset poverty, rising college costs, high foreclosures, lack of retirement savings, and the social determinants of health. We look forward to working with the Committee to get families on the path to lifelong economic security and build healthier communities."
The Committee will give asset creation and protection policies an official forum through informational committee hearings and policy briefings. It will publish issue briefs, quarterly newsletters, and a year-end report summarizing its legislative activities and providing potential policy recommendations.
The New America Foundation's Asset Building Program has championed state-level policy to create children savings accounts, help Californians save their tax refunds and build savings for college and retirement, provide K-12 financial education, remove barriers to saving for welfare recipients, help families avoid foreclosures and predatory payday loans, and boost communities' ability to build assets through energy efficiency and new green technologies.
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About the New America Foundation
The New America Foundation is a nonprofit, nonpartisan public policy institute that invests in new thinkers and new ideas to address the next generation of challenges facing the United States. Learn more at www.newamerica.net.