Money As You Grow

Money and financial matters can be difficult to discuss, especially with your children. To help you get started, check out this great online tool, Money As You Grow. This tool was developed by the President's Advisory Council on Financial Capability. It provides 20 age appropriate financial lessons along with activities to help put the lessons into practice.

For example, a lesson for a 3 to 5 year old is that "you earn money by working." An activity that may help you child understand this concept is to walk through  your neighborhood and point out different jobs that people are doing.

The main objective of this tool is to improve the financial capability of young Americans. Families can use these lessons and activities to start a conversation with their children about money and to teach kids the importance of saving, making choices, and avoiding debt.




After checking out this overview of the 20 financial lessons to kids to learn as they grow, be sure to check out the website to take advantage of the various activities you can do to help these lessons stick.

http://moneyasyougrow.org/#

The Generational Wealth Gap

If you graduated from college in the last few years, then you know how tough the job market is. Young adults have been among the hardest hit by the Great Recession. This generation, commonly referred to as “millenials,” have faced one of the worst job markets since the Great Depression. Many struggling graduates have been forced to take part- time jobs or jobs with uncertain futures. As a result, their ability to build wealth has diminished.

In recent years, there has also been a large increase in "boomerang kids" or young adults who live at home. Many are forced to live at home out of financial necessity. According to Pew Research Center as many as 3 in 10 young adults now live at home. In 1980, only 11% of young adults lived at home. Now, nearly 30% of 24 to 34 year old adults live at home.

All of these factors have contributed to the generational wealth gap: older Americans continue to gain wealth while the net worth of younger Americans is decreasing, which David Francis writes about in his article, “The Far- Reaching Effects of the Generational Wealth Gap.”

The Pew Social and Demographic Trends Report found that the average net worth of people under age 35 decreased from $11,521 in 1984 to $3,362 in 2009, a 68% drop. Compare that to an increase of 42% in average net worth among people 65 and older during the same time.

Paul Taylor, executive vice president of the Pew Research Center, says that the inability of young people to build wealth has resulted in a nationwide case of arrested development. Young adults who cannot find work are returning home and opting not to get married. “These are patterns that are decades in the making and they were accelerated by the bad economy,” Taylor says.

You may have heard the term “funemployment” used to described this time in young adults’ lives. Funemployment is defined as “a happy time in one’s life when one is not employed and not wanting to be employed.” However, this is not an accurate portrayal of the current economic climate. Most young adults would like to find a decent job but graduated during a time with a gloomy employment outlook. When they do find jobs, they are less willing to take risks, and they value security.

Can you see effects of the generational wealth gap in your household? What challenges have you faced as it has become more difficult to find employment?

The Growing Problem of Concentrated Poverty of NC

A growing number of North Carolinians are living in concentrated poverty neighborhoods. If your neighborhood in particular hasn’t been affected, you may wonder why this is important. The North Carolina Justice Center released a report this month, “Barriers to Opportunity: The Growing Problem of Concentrated Poverty in North Carolina’s Neighborhoods” to detail this issue and explain why it matters.

Using data from the United States Census Bureau, the NC Justice Center found that as of 2006 to 2010, there were 100 areas of concentrated poverty in North Carolina- nearly triple the number from 2000. Data also shows that 143,445 poor residents live in these extremely poor areas, which is 3.5 times the number in 2000.

Areas of concentrated poverty are defined as census tracts with poverty rates of 40% or more, using the federal poverty level.

Patterns of concentrated poverty have persisted for decades because of factors such as rapid suburbanization, deindustrialization, commercial disinvestment, and racial discrimination in housing markets. Government policies, such as home ownership subsidies, public housing location decisions, interstate and highway subsidies, and deterioration in local services, have also contributed to concentrated poverty.

Being poor and residing in a poor neighborhood is known as a “double burden” because it magnifies and perpetuates the problems that poor people face. Research shows that residential segregation of people who are poor leads to negative neighborhood effects, which are community influences on individual socioeconomic outcomes. Neighborhood effects include low- quality educational opportunities, weaker employment networks, and higher rates of crime.

Data also shows that in 2006- 2010, 10.4 percent of the state’s impoverished children lived in concentrated poverty neighborhoods. This is particularly alarming for a number of reasons. Research shows that regardless of family income, children raised in these neighborhoods have less access to good quality schools, early education programs, and social networks that foster healthy development. They are also at higher risk of poor outcomes, including higher stress levels, higher dropout rates, and more emotional problems.

Opportunity structure is deeply connected to the neighborhood. As a result, concentrated poverty neighborhoods have great implications for the families that live there and particularly for the children that grow up there.

For this very reason, New Century IDA is proud that its graduates can purchase a home any where in Forsyth County. By not limiting its clients to certain neighborhoods, the IDA program gives people more options and does not contribute to creating poverty concentrated neighborhoods. However, there is still much work to be done and this is an issue that we should all be aware of.

Evolving Household Dynamics ("I am Woman, Hear Me Roar")

As the economy and job market have changed over the last several years, it is no secret that family structure and the way families operate has changed in order to adapt. In the latest Time Magazine cover story “Women, Money, and Power,” Liza Mundy writes, “Not since women entered the work force by the millions after WWII has America witnessed economic change on this scale.”

The workforce is changing. It has become common for married women to work and even to outearn their husbands. In 2009, nearly 4 in 10 working wives outearned their husbands, which is an increase of more than 50% from 20 years before. Women also make up 60% of college students and earn a majority of doctorates and master’s degrees. Some experts predict that within the next 25 years professions such as law and medicine will be dominated by females.

There has also been a dramatic increase in the number of single parent families. 41% of babies are now born to single women. Young women are acutely aware of the potential that they may be the sole earner in their household and that supporting a family is a far greater responsibility than just supporting oneself.

As more women are the co-breadwinners and primary breadwinners for the families, assumptions about how the household works are changing. Women’s earnings and financial status give them more economic influence both at home and in public. It is predicted that rates of cohabitation and single living will continue to rise because women can afford to wait. Financially secure single women are a growing market for restaurants, travel, and real estate.

The growing trend of female supported households is evident at New Century IDA. The majority of IDA clients are single mothers. Each of these women have earned income with which they support themselves and their families. A common thread among these women is that they are motivated to participate in New Century IDA and become home owners because of their children. They all want to have a stable environment in which to raise their children, and they want to give their children a better life than they had. Many of them are also proud to show their children what they can accomplish on their own, without the help of a man.

If the present trends continue, by the next generation more families will be supported by women than men. Has your family structure changed over the years? Let us know what you think, then take this quiz to see who holds the power in your household!

Time Magazine Cover March 26, 2012

LaTeesha's Story

Even though you may check our website and read our blog, to fully appreciate how New Century IDA empowers people you need to hear first hand from someone who has participated in the program.

LaTeesha is a graduate of Winston-Salem State and an Income Maintenance Caseworker in Family and Children’s Medicaid for Forsyth County. She has completed the financial literacy classes and will graduate from New Century IDA with Wave 29 on March 27^th. Like many people who participate in New Century IDA, LaTeesha is motivated by her son. By achieving her goal of homeownership, her son will be able to grow up in his own family’s home. He will also learn what his mother is capable of and what can be achieved with hard work and dedication to a goal.

To learn more about LaTeesha’s experience in New Century IDA, watch the video below!

Thanks to LaTeesha for sharing her story! Congratulations on all of your achievements so far!

Growing Number of Americans Living in Poverty

It’s no secret that more Americans are struggling to stay in the middle class. However, the number of Americans living in poverty are quite staggering. The Census Bureau released a report that shows a record number of Americans are living in poverty- 46 million. This is the highest number reported since the Census Bureau began tracking poverty rates in 1959.

The Census Bureau also reported that the number of families living below the poverty line increased by 18%, from 7.3 million in 2006 to 8.6 million in 2010. In 2010, the poverty line for a family of four was a household income of $22,314 or less. 

There is also a trend of more poor people living in the suburbs.  The number of poor people living in the suburbs of metropolitan areas increased by 24%, from 14.4 million in 2006 to 17.8 million last year. As a comparison, the number of poor living in cities rose by 20%.

As the number of Americans living in poverty are growing, the faces of poverty are changing as well. Timothy Smeeding, director of the Institute for Research on Poverty at the  University of Wisconsin- Madison says “It’s all about joblessness. There’s just not enough work.” The Great Recession has left many Americans struggling to find employment. According to an article in the USA Today, it has not only made the poor poorer, but it has affected those who thought they had escaped poverty as well as those who never imagined being thrust into poverty. The college-educated, the former middle- class worker, the suburbanite, and the homeowner can now all be found among the poor. 

For stories about families that are trying to escape poverty, read the article Poverty Affects 46 Million Americans by Marisol Bello and watch the video below.

Volunteer Income Tax Assistance (VITA)

As you know, filing a tax return can be very confusing and intimidating. For this very reason, many people use the services of a commercial tax preparer, which may cost $55 to $130. Since many tax filers would like to get their money as quickly as possible, tax preparers often persuade the filer to go for a “refund anticipation loan” (RALs) or instant refund, which can cost another $100. That means that the tax filer could already have lost up to $230 from their tax refund!

Low income workers need every penny of their tax refund and cannot afford to be losing part of it to tax preparers. However, they may not know what options are available to them.

A cost free alternative to commercial tax preparers is VITA- Volunteer Income Tax Assistance- a program run by the IRS and community based organizations. VITA volunteers are trained to fill out basic tax forms, including ones needed to claim the EITC. And the best part is that there is no charge! Many VITA sites can file tax forms electronically, which results in a faster refund.

For additional information on the VITA program in Forsyth County, watch this interview with Kindra Speech, EITC Program Manager at Experiment in Self Reliance.

Click here for a list of VITA sites in Forsyth County and their schedules, as well as a list of what you should bring to the VITA site. 

The VITA program is a real asset to low income working families, and it can help them save money by not using a paid preparer. We hope you will take advantage of this great resource in our community!

The Earned Income Tax Credit (EITC)

With tax time quickly approaching, it is important for families to be aware of the benefits that are available to them, particularly the Earned Income Tax Credit. The EITC is a tax benefit for low to moderate income working people. It helps to offset taxes, to supplement very low wages, and to provide a work incentive.

Besides offsetting taxes, workers can also get cash back through the EITC refund. Workers who qualify for the EITC and claim it on their federal tax return can receive a refund check from the IRS even if their earnings were too small to owe income tax.

Workers with one child in their home and an income of less than $36,052 (or $41,132 for married workers) in 2011 could receive a credit of up to $3,094. The amount of the credit increases with the number of children living in the home. Workers between the ages of 25 and 64 who were not raising children in the home, and had an income below $13,660 (or $18,740 for married workers) could receive a credit up to $464. This credit can be a huge help to working families!

To get the EITC, workers with a “qualifying child” must file either Form 1040 or 1040A as well as Schedule EIC. Married workers must file a joint return. Workers who were not raising a “qualifying child” can file any tax form, even the 1040EZ.

Our partner Experiment in Self Reliance, hosts the EITC program in our community. You can also participate in National EITC Day which will be held January 27, 2012 at Career Connections and Prosperity Center on Waughtown St. Hope to see you there!

IDA Success Stories: M.M.

Had I been asked to write this success story two months, I would still have a lot to say, and a whole lot more time to say it. I didn’t have house then, but thanks to the IDA program I had already accomplished two things I thought I’d never.

The first was not spending money on things I didn’t need. For years the use of credit cards were my biggest temptation and downfall. The IDA program helped me distinguish between things I needed and things I wanted. Learning about interest rates on credit cards made me realize that the now broken VCR I charged 11 years ago actually cost me $600 dollars. The closet full of clothes I charged (now all too small) cost me four times the good bargain I thought I had found, and with all the money I charged for meals at fancy restaurants (that led to the clothes being too small), I could have almost bought my own restaurant! I was happy to cut the cards up.

Getting rid of them helped lead me to the second accomplishment – saving money. One of the main principles of the IDA program is saving money. And I was able to do it! Believe me, pre-IDA, no bank account of mine had ever seen a four digit balance for more that a couple of days!

That leads me to why I’m short on time today. When my savings account hit $1,000, Sue Simmons told me to start looking for a house. So I looked. And I looked. I looked at houses too small and at houses too big, houses with no closet space, houses with no counter spaces; ugly wallpapered walls, hideous carpeted floors. Until one day, my real estate agent drove me into a perfect driveway that led to a perfect house! I asked her to write the contract to make a bid on it right away.

In a blur, my loan was secured, the house was inspected, and the lawyer was contacted. And at closing, there sat Sue Simmons, along with Mr. Stewart from ESR, providing support and encouragement to the very end, not to mention the checks they passed to the lawyer on my behalf! It was all so simple, and I am so very thankful.

Today, I’m in my home with a garage full of junk waiting to be put away. And every night, I get down on my knees to thank God for that garage and the house to which it is attached, for my family and for the IDA program.

Empowerment through Housing and Family Involvement

David Blake Lucas, a Housing Counselor with Kingdom Community Development Corp., and former AmeriCorps*VISTA, shares his favorite story from when he was a housing counselor in Boston, MA.

As a housing counselor with Welfare to Work in Boston MA, Blake supported a single mother in finding housing in Canton, MA, an extremely wealthy, upper middle and upper class area just south of Boston, with a Section 8 voucher. He learned, years later, this was a gateway to continued life success.

The second part to the video is about the benefits (and necessity) of complete family involvement in the home ownership process. He shares stories from his work with Habitat for Humanity, and how they were able to get even the youngest of children involved (through non building ventures).

Andriana Bicanin

AmeriCorps*VISTA

New Century IDA