November 16, 2010
Gold Standard Applied Research Demonstrates Factors Critical in Enabling Low-Income Families to Achieve Financial Success; Inauguration of the ERI Coincides with Publication of White Paper and Website Relaunch
EARN , the nation's leading provider of microsavings for low-income workers, today established the EARN Research Institute (ERI) in order to advance the nation's capacity to put low-income workers and families on the path to prosperity.
Drawing upon EARN's decade-long history of success in the San Francisco Bay Area-and innovations that have begun to reverberate on the national stage -the Research Institute is devoted to the publication and dissemination of rigorously researched materials that demonstrate the behavioral dynamics of financial efficacy and access for low-income earners and the promotion of public policies that enable low-income earners to create prosperity for themselves and their children.
"San Francisco is proud to be the home of the EARN Research Institute," said San Francisco Mayor Gavin Newsom . "EARN's hands-on financial literacy and empowerment for people in cities across the nation builds upon the success of San Francisco's groundbreaking investments in moving all families toward financial security. The EARN Research Institute shares national best practices, so all Americans will have the tools necessary to succeed."
"EARN is launching the EARN Research Institute because we are uniquely positioned on the ground to provide solutions for America's low-income families," says EARN President and CEO Ben Mangan . "With approximately fifty million Americans currently considered working and poor, the need for this kind of evidence-based research organization is deeply felt. EARN's asset-building solutions have helped thousands of low-income workers to save money in ways that have made substantial positive changes in their lives. The Research Institute promises to lead the field promoting financial services for low-income workers and change perceptions about how to address the plight of America's low-income families."
Indeed, EARN's first-ever national poll found that low-income families have no financial safety net: more than 1/3 of low-income households surveyed across the country reported that they were unprepared to meet their basic financial needs for more than one month if their income were disrupted. In contrast, a recent EARN study of its program's long-term impact demonstrated that 83% of participants continued saving at similar rates following the completion of EARN's flagship program Individual Development Accounts (IDAs), a form of matched savings account for low-income workers.
The ERI will focus on topics ranging from what motivates low-income earners to save; to the economic and social benefits of saving; to the connection between financial knowledge and financial outcomes for low-income earners; to the role financial efficacy plays in health outcomes; to the effects of financial coaching on the long-term ability of low-income earners to perform the behaviors required to build financial wealth. EARN Research Institute deliverables will include: white papers, articles for publication, research briefs, practice briefs, webinars, and conferences.
White Paper Published, Website Launched
To mark the inauguration of the Research Institute, EARN has re-launched its website, www.earn.org , which includes a host of free financial coaching material and multimedia content. In addition, EARN today published the Research Institute's fifth publication, "Behavioral Models for Driving Prosperity for Low Income People: EARN's Model of Financial Self-Efficacy," written by William M. Lapp, Ph.D. , and available for download here . The paper aims to demonstrate that EARN's low-income "Savers" learned more about their financial situations, became more empowered to do something about it through EARN's information sessions and financial coaching, and thereby reduced their financial problems.
"While savings are critical to weathering financial adversity and to building security, low-income earners have been typically denied the mainstream, benefits of savings," says EARN Research Manager Dr. Lapp, who holds his doctorate in cognitive psychology. "Traditional reasons for that marginalization include a combination of poor wages, lack of familiarity with how to navigate the financial services landscape, and uneven practice in saving money. Tools are available, however, to tens of millions of low-income Americans who can build wealth through their own efforts. Helping promote these solutions using applied research is the purpose of the EARN Research Institute-and there could not be a more pressing time for its launch."
EARN is an award-winning nonprofit organization that gives low-income workers the power to create economic prosperity for their families for generations to come. Since 2001, EARN has helped tens of thousands of low-wage families through innovative financial products including matched savings accounts, checking accounts for the unbanked, micro-loans, and money management coaching.EARN's powerful combination of lasting assets and financial know-how enables families to build wealth and achieve life-changing goals such as saving for college, purchasing first homes, or starting small businesses.Through its policy and research arm, EARN evaluates its impact and reports on new data regularly, sharing lessons learned and best practices in order to transform the financial services landscape and to champion effective public policies.EARN's ultimate vision is that millions of well-informed, low-income American families will achieve financial success through proven strategies, fair public policy, and their own hard work. Visit www.earn.org or follow us at http://twitter.com/earn and http://facebook.com/EarnOrg .