Financial Inclusion

New Feature: Asset Building News Week

January 6, 2012
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Way back in 2011, we conducted a survey of readers that told us a number of things: importantly, we learned that many of you look to us for timely news from the asset building field and that a regular round-up of articles would be a welcome addition to our other content. In keeping with the spirit of 2012 and resolutions and all that good stuff, the Asset Building Program is introducing a new weekly blog feature: a Friday news round-up. We hope this will help you (and us, for that matter) keep up with developments in the field, note-worthy news, and learn about partner organizations working around the U.S. on asset building, economic security, anti-poverty policy, and accessible financial services for low- and middle-income Americans. Topics will vary week-to-week (and depending on the news!) but we’ll aim to provide a diverse overview of the things we’re keeping an eye on that we think you’ll find interesting too.

YouthSave New Year Update: a Glance Back at 2011, a Look Ahead at 2012

January 4, 2012

By Rani Deshpande, YouthSave Director, Save the Children

Originally posted on www.youthsave.org

Don't Miss These Upcoming Asset-Building Presentations

January 3, 2012
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If you live or work in the Washington, D.C. / Virginia / Maryland area and are interested in asset-building, you are in for a treat. During January 11-15, 2012, approximately 20 individual research papers and posters focusing on asset-building research will be presented at the annual conference of the Society for Social Work and Research (SSWR). This research is the latest and greatest from some of the leading researchers in the asset-building field, including Gina Chowa, Michal Grinstein-Weiss, Vernon Loke, Jin Huang, and Youngmi Kim. Topics include savings at tax time, financial capability of youth in international settings, home ownership and housing stability, and debt and asset accumulation. The conference will be held at the Grand Hyatt Washington. Presentations that are "don't miss" are listed below. Click on the number at the end of the titled presentation for a direct link to the complete abstract.

Summarizing the Research: Asset Effects for Children with Disabilities

December 23, 2011
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During one of our recent events, Sheldon Garon of Princeton University and Ray Boshara of the Federal Reserve Bank of St. Louis referred to the weak household balance sheet as one of the core economic challenges of our time, suggesting that households must focus on asset-building rather than rely on credit and debt.

Assets and the Poor 20 Years Later

December 22, 2011

Bob Friedman has a really nice post up over at CFED's in-house blog, The Inclusive Economy. In it he commemorates the 20th anniversary of the publication of Michael Sherraden's seminal work, "Assets and the Poor," the book that essentially launched the asset building field and details his introduction to the book.

Why Financial Literacy Isn't Enough, and What to do About it?

December 19, 2011

Originally posted on www.youthsave.org

A new blog post, “Why Financial Literacy Fails (and What to Do About It)” takes a strong jab at the efficacy of financial literacy interventions saying “Time and again, [its] efforts have failed. They don’t make any noticeable difference in the way we spend and save.” While mixed results from studies measuring the impacts of financial education indicate that the jury is still out on its effects on individuals’ financial behaviors, the author goes on to make a valid point with which I whole-heartedly agree: “financial literacy isn’t enough.” That is, financial success is not necessarily determined by how well individuals can calculate interest rates, but how well they are able to delay gratification for immediate consumption, control their emotions, and overcome other psychological barriers that prevent most human beings from making rational choices, such as saving. 

Default Stickiness, Low-Income Employees, & Considerations for Designing AutoSave

December 16, 2011
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The George Washington University School of Business and the Federal Reserve Board host a Financial Literacy Seminar Series  which bring together academics, policy makers, practitioners, and other experts interested in research on financial education and capability building.  Tuesday’s session featured Brigitte Madrian from the Harvard Kennedy School whose research is a cornerstone for our understanding of household saving and investment behavior,

Less Money, More Impact

December 15, 2011
http://www.flickr.com/photos/katkamin/6462625847/

This week, renowned blogger Matthew Yglesias argued that moving away from a physical currency would make the US economy recession proof. He points out that a time-tested approach to ending recessions is cutting interest rates, since "when rates fall, business investment, homebuilding, and durable goods purchases all rise and next thing you know everybody’s back to work." The problem is that currently the US has interest rates are already near one percent, and any drop below zero would lead "people [to] just withdraw money and store it in shoeboxes." That is, unless taking cash out of the bank was not an option. In this case, argues Yglesias, a negative interest rate would incentivize those with money in the bank to invest, make purchases and spend the country out of recession as they have in times past.

Follow-Up: Beyond Our Means

December 14, 2011
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On December 13, 2011 the Asset Building Program hosted Professor Sheldon Garon, author of Beyond Our Means: Why America Spends While the World Saves. While economists often claim people save according to universally rational calculations — saving the most in their middle years as they plan for retirement and saving the least in welfare states — there are substantial differences in savings rates across high income countries. For example, Europeans save at relatively high rates despite generous welfare programs, while Americans save little, despite weaker social safety nets. The assumption that generous social benefits will provide a disincentive to save doesn’t hold up.

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