United Way of Washtenaw County Invests in Financial Stability

In addition to our five focus areas and as part of our commitment to addressing key community issues, United Way of Washtenaw County is now working to positively impact the financial stability of our citizens.

Our Goals

  • Advance the economic well-being of low-income working individuals and families.
  • Reduce predatory financial practices in Washtenaw County neighborhoods.
  • Ensure that low-income working individuals and families are aware of available asset-building resources.
  • Provide opportunities for low-income individuals and communities to increase their economic asset base.
How We're Doing It
We’re working to advance our financial stability goals through the following programs and strategies:
  • Mobile Financial Resource Team: Providing one-on-one financial coaching and workshops to individuals at no charge.
  • Expanded Volunteer Income Tax Assistance Program: Free tax assistance provided by volunteers and professionals to low-income individuals and families
  • Dedicated Financial Stability Funding Stream: Grants to nonprofits for existing and emerging agency programs focused on financial education and self –sufficiency initiatives.
  • Advocacy and Public Policy: Increased advocacy efforts to local elected officials, public awareness campaigns and community conversations.
The Need for This Work
Over the past several years, data demonstrates that Washtenaw County is slowly and steadily recovering from the Great Recession, but we know low-income working individuals and families are the most likely to be “left behind” as communities recover. A recent study commissioned by the Michigan Association of United Ways explored the extent to which individuals across Michigan could be characterized as ALICE—Asset Limited, Income Constrained and Employed.  Here in Washtenaw County, when one takes into consideration those living at or below the poverty level (15%) along with those who could be considered ALICE (24%), it reveals that thirty nine (39%) of Washtenaw County residents are struggling to afford basic needs.  Most of these individuals reside in Ypsilanti (56%), many are of people of color, and nearly a quarter (23%) are seniors.[1]
 
We know that a bank or credit union account can be the first step in saving, planning for the future, building credit and climbing the economic ladder. However, in Ypsilanti, thirty two percent (32%) of households are either un- or under-banked.[2] The consequences are stark-- the average full-time worker without a bank account can spend $40,000 over the course of their lifetime just to cash paychecks. 
 
Although one of the most affluent counties in Michigan—nearly one third of households report an annual income greater than $100,000-- One in five households (22%) do not have sufficient net worth to subsist at the poverty level for three months in the absence of income. Over one third of households (33%) do not have sufficient liquid assets to subsist at the poverty level for three months in the absence of income.[3]
 
The data above reveal what we already know-- few people ever spend their way out of poverty. Those who escape permanently usually do so through living-wage employment opportunities, budgeting, saving and investing in personal financial assets to achieve long-term goals.
 
About the Mobile Financial Resource Team
The Mobile Financial Resource Team is a one-on-one financial empowerment coaching program that builds and sustains foundation-level asset building and connects individuals to other human and financial services. The program services are mobile—services are provided on a rotating basis at local neighborhood nonprofit agencies. Unlike other providers of financial education services in Washtenaw County, the only requirement for receipt of services is a desire to become more financial stable. 
 
The program provides a continuum of financial stability services, focusing on core concepts of literacy, budgeting, banking, asset building and protection within a non-prescriptive coaching model. 
 
Key program activities carried out by the Financial Capability Coordinator include:
  • Increasing the availability of financial education resources to clients and the community at large through the provision of financial education activities.
  • Provision of one-on-one financial coaching to meet individual desired objectives and help individuals/families towards self-sufficiency.  
  • Follow up with clients regarding their use of financial services and progression to their goals; document progress. 
  • Longitudinally tracked client satisfaction surveys and quantitative metrics looking at decrease in debts, increase in assets, and increase in credit scores among program clients.
  • Conduct outreach and education to local human service nonprofits regarding available financial coaching and capability services.  
  • Collaborate with various state and local organizations to build awareness of one-on-one financial coaching and the benefits of this service.  
  • Work to build an asset-building coalition in support of financial stability, comprised of community organizations and financial institutions.
Results from October 2014 through October 2015: 
  • 184: # of individuals who received free financial education
  • 30: # of workshops hosted in partnership with social service agencies, including: Michigan Works, Faith in Action, Manchester Community Resource Center, Housing Access for Washtenaw County, Avalon Housing, and the Family Empowerment Program at Hamilton Crossing.
  • 25: # of individuals who received free one-on-one financial empowerment coaching on-site at local social service agencies. However, this number does not tell the full story. During the first half of the time period efforts were focused on building awareness of and trust for this service. Now that local social service agencies, as well as community members, are aware of this service – and trust Marshall Averill and Brian Rakovitis-- the stream of clients is steady and building.
The Stories behind the Numbers….
A client, trapped in a cycle of payday loans for upwards of 6 months, began working with financial empowerment coach, Marshall Averill. Over the course of dealing with her payday loans she had paid well over double the loan’s initial amount in fees alone. Through working with Marshall, she was able to devise a plan to gradually lower the amount that she was rolling over with her payday loan and eventually pay it off entirely. By getting out from the cycle of payday loans, this client was able to free up some extra money in her budget and is now working on paying down some other debt that she has, and it in a financially stable position.
 
One of the more emotionally impactful clients that Marshall Averill worked with was acting as a proxy for a friend of hers. This client came to Marshall looking for advice for a friend that was diagnosed with terminal cancer. Through the course of the friend’s illness a large amount of medical debt had accrued. In order to pay the medical bills, the woman had used credit cards to cover some costs, and had relied on friends and family to cover the rest. As she lost her ability to work due to her illness, she also lost the income needed to continue making full payments towards the credit cards. Being very conscious of the fact that she did not want to leave behind unpaid debts, she continued to make partial payments and tried to work with the credit card companies to lower or even eliminate the interest rates. Through working with the credit card companies she revealed that she had been receiving financial help from friends and families. Upon learning this, the companies began attempting to get the people helping her to co-sign on the debt, which would have meant that the debt transferred to them upon her passing. The client was not looking for a way to escape from her responsibility; she just wanted an escape from the constant phone calls. Averill notes that “With my help we were able to eliminate the phone calls so that she could continue paying what she could, and was able to gain some peace in her final days, and some comfort in knowing that her friends would not have to take responsibility for any debts that she might leave behind.”
 

Building the financial stability of individuals and families is critical to fueling our county’s economic growth and progress and creating a thriving community for everyone.  We know that financial stability work is not only prevention-oriented; it also compliments United Way’s current grant investments. The Mobile Financial Resource Team is one important program that helps individuals build a successful future through financial education and coaching.

Want more information? Contact Bridget Herrmann, Director of Community Impact, at bherrmann@uwwashtenaw.org.


[1] Source: American Community Survey Data; The ALICE Project, published by the Michigan Association of United Ways September 2014.  
[2] Unbanked Profile of Ypsilanti, produced by CFED under contract with the U.S. Department of the Treasury.  
[3] Conservatively measured as $5,887 for a family of four, or three times their monthly income at the Federal Poverty Level of $23,850. Source: “Treading Water in the Deep End: Findings from the 2014 Assets and Opportunities Scorecard”