Financial Stability

As many as one-third of working Americans do not earn enough money to meet their basic needs. These individuals are walking a financial tightrope – they are barely able to get by, with no ability to save for college, a home or for retirement.

Family-sustaining employment is the foundation of financial stability.  Almost 25% of adults in the United States earn less than $27,000 a year in jobs that offer no health care, vacation, or paid sick leave.  These workers often struggle to afford food, rent, childcare, and transportation, with little left over for saving and investing.

Families need a steady source of income that covers the cost of basic necessities before they can make more long-term financial decisions regarding savings and asset building.  Now more than ever before, educational attainment is fundamental to the long-term earning potential of an individual.  It is critical to connect disconnected youth and adult learners with alternative education and work experience opportunities.

Communities with a stable, skilled workforce are more economically competitive and have the potential to attract business and revitalize neighborhoods.

To be financially stable, working families need housing that is affordable.  Today, more than 4 million working families spend more than half of their income for rent and/or mortgages, leaving them particularly vulnerable to eviction or foreclosure if their income is interrupted.

The limited supply of affordable housing stock, coupled with long waiting lists, and confusing application processes, makes it extremely difficult for low-income working families to obtain affordable housing.

The United Way of Southwest New Mexico is working with local programs and service providers to connect residents to income supports and tax credits, first-time homebuyer programs, and homeownership counseling to help them retain and manage their housing.

One in four households with children are asset poor and one in six lives in extreme asset poverty, according to the Center for Enterprise Development (CFED).

Savings and assets can help low-income working families avoid financial crises caused by emergencies or unexpected changes in income, while also helping them realize long-term goals including homeownership, a college education, and retirement.

Providing low-income working families with targeted financial education, appropriate financial products, and easy, low-cost opportunities to save, combined with strategies to reduce their debt and expense, will help them to build a financial foundation that lends itself to savings and asset accumulation.

Low-income working families tend to pay more for basic goods and services because of the neighborhood they live in, credit history, or lack of access to transportation.  Resources such as groceries, healthcare, financial services, credit products, and insurance can cost low-income families more than the same services cost higher-income families.

Research shows that reducing the cost of living by just 1% would add more than $6.5 billion in new spending power to a community.  Increasing the availability of and access to low-cost services and connecting low-income working families with appropriate consumer education will ensure that they remain healthy and purchase goods and services that are fairly priced and within their budget.  Manageable expenses make it possible for families to work, avoid debt, and increase their ability to save and invest.

Research indicates that almost $65 billion in benefits go unclaimed by low-income working families each year.

The United Way of Southwest New Mexico promotes and connects low-income working families with all the available income supports for which they are eligible and work with community-based organizations and agencies to streamline enrollment processes. Through these efforts, low-income working families will be better positioned to move towards financial stability.