FOR IMMEDIATE RELEASE
BOSTON – Massachusetts residents on the whole enjoy a high degree of financial stability as compared to other states, but large disparities exist for low-income families and families of color, according to a report released yesterday by the Corporation for Enterprise Development (CFED), a national economic nonprofit. The report comes at a time when the State Legislature is considering legislation sponsored by State Senator Jamie Eldridge (D-Acton) that seeks to improve financial stability for low-to-moderate income families.
Findings from the report, the “Assets & Opportunity Scorecard,” include the following:
- While the median net worth of Massachusetts families is high (Massachusetts ranks 7th in the nation), disparities by race and income are huge. Massachusetts ranks well-below average for the ratio of the median net worth of households in the bottom income quintile and those in the top (32nd in the nation) as well as between white and non-white households (31st in the nation.)
- A full 25% of Massachusetts residents qualify as “asset poor,” meaning that they lack the sufficient net worth to subsist at the poverty level for three months in the absence of income — putting the state at 38th in the nation. And nearly 15% qualify as “extremely asset poor,” meaning that the household has zero or negative net worth (31st in the nation.)
- Large disparities also exist in homeownership, with Massachusetts ranking 46th in the nation in homeownership by race, and 50th in homeownership by income.
“Although Massachusetts is doing well overall in terms of financial stability, when you look closer it’s clear that for many families, the picture isn’t so rosy. The Scorecard shows us where we can focus our work to make all families financially secure,” says Margaret Miley, Executive Director of The Midas Collaborative, a statewide network of non-profit organizations assisting low income residents to build financial stability through savings, financial education, and asset-building.
The Scorecard report recommends the state reduce these disparities through policy changes to remove savings disincentives for very lowâ€income households, such as eliminating the asset test in its Temporary Assistance for Needy Families program and expanding savings incentives through Individual Development Accounts.
“Far too many families are still living just one paycheck away from poverty and even homelessness– particularly low-to-moderate income families and families of color,” said State Senator Jamie Eldridge. “Although Massachusetts has made great advances in expanding health care access and promoting job creation, we need to make sure we are helping all families gain financial stability and move up the economic ladder.”
Eldridge has sponsored legislation this session that would remove state-imposed barriers — such as the extremely restrictive asset tests for TANF programs – for low-to-moderate families in developing assets necessary to gain financial stability. The bill (S. 38) was heard by the Joint Committee on Children and Families last week.
CFED’s Assets & Opportunity Scorecard-online at scorecard.cfed.org-measures the financial security of families in the United States by looking beyond just income to the whole picture of building ownership and protecting against financial setbacks. The Scorecard ranks states on performance measures in the areas of Financial Assets & Income, Businesses & Jobs, Housing & Homeownership, Health Care and Education.