The Asset Building program incubates promising policy proposals and serves as a leading voice on innovative public policies to enable low- and middle-income families in the U.S and around the world to accumulate savings, access wealth-building financial services, develop financial capability, and build and protect productive assets across the life course.
Child Savings Accounts
The Asset Building program is home to some of the world’s most experienced policy experts on children’s savings accounts in developed and developing countries. Since 2003, the Asset Building program has worked to develop and inspire new policies and programs that move the nation toward a universal and progressive system of children's savings accounts. Policy proposals such as the ASPIRE Act would create a universal platform for financial inclusion and promote a culture of savings, education achievement, financial capability, and economic opportunity—especially for children in families with lower income and few resources.
The growing recognition that millions of Americans are ill-prepared for retirement has prompted a number of state and federal policy proposals to promote retirement security. Yet even the most promising proposals fail to acknowledge a prerequisite to sustaining long-term savings: access to flexible resources that can be tapped in an emergency or can support productive investments that can pay off over the long haul. The Asset Building program is working to develop and support new systems that include all Americans and are designed to support their real savings needs at all stages of life.
Asset Limits and Public Assistance
For many low-income families, slight changes in their financial circumstances can have dramatic consequences on their well-being. Savings, even in modest amounts, should play a complementary role to the system of safety-net supports offered publicly. Unfortunately, eligibility rules often place an explicit restriction on the amount of savings a family can have and receive support. By creating a trade-off between immediate need and long-term security, asset limits undermine the intent of the support. Asset limits also impose a significant administrative burden on both caseworkers and families seeking assistance. Asset limits must be eliminated to achieve a social safety-net that promotes savings, simplicity, and self-sufficiency.
Savings, Assets, and Tax Reform
The tax code is riddled with inequities. While some low-income households benefit from refundable credits provided in the tax code, many more are categorically excluded from benefiting from valuable tax incentives. The nearly 70 percent of Americans that do not itemize on their tax returns cannot access a range of valuable benefits, deductions, and write-offs that deliver huge benefits to higher-income households. As currently designed, our tax system facilitates substantial rewards for high-income earners without advancing the intended social goals of providing inducements to save for the low- and middle-income families that need saving incentives the most. This is a policy failure. Reforming the tax code offers an opportunity to effectively promote increased saving and asset building as a means to help families increase their financial security and economic mobility.