The concept of financial competency is present in a variety of the current policies related to programs that are designed to help individuals achieve a better life through increased independence and employment. As Employment Networks, this offers opportunities to partner with VR and other organizations formally, or establish informal referral sources. Among these policies are:
- Rehabilitation Act of 1973
- Workforce Innovation and Opportunity Act (WIOA)
- Home and Community Based Service (HCBS) Final Rule
- Americans with Disabilities Act (ADA)
- Ticket to Work and Self-sufficiency Program (TTW)
Simultaneously, emerging research suggests that economic empowerment interventions can increase the motivation of individuals to work and engage in employment supports. Conversely, research suggests that worrying about financial issues prevents an individual from focusing on work, which limits productivity and threatens job maintenance.
As many as 47% of employers are requiring credit checks as part of the screening process. Of that, 10% are denied. If a beneficiary we are working with is one of those who are denied, it would be helpful to suggest specific ways to improve that rating. Individuals in economically depressed areas often consider moving to areas where employment in their field of interest is more likely, but without knowledge of financial issues they may lack the confidence to relocate.
Meanwhile, the WIOA now includes a measurement of client earnings at the 2nd and 4th quarters after successful State Vocational Rehabilitation (SVR) case closure. Employment alone is no longer enough. ENs can help, and the resulting increase in SSA’s cost reimbursement to SVR agencies strengthens the EN-SVR relationship.
We have seen the goal of workforce development and vocational rehabilitation evolve from getting a job, to entering a career path with a future and access to benefits, to learning to manage assets and grow financial stability. As we discuss this, it may be helpful to differential between strategies (financial education, financial coaching, financial counseling) from outcomes (financial literacy, financial capability, financial fitness). The Ticket to Work Program focuses, of course, on outcomes. We must start to think about how the outcomes for the beneficiaries we serve would improve if we could help them grow in financial literacy, financial capability and financial fitness. This has been an elusive goal. Typically, we are not credentialed financial planners; we see the need, but we often don’t know how to help. That has recently changed. EN staff do not need to be certified financial planners or accountants to help their beneficiaries understand and make informed choices about money.
The Consumer Finance Protect Bureau (CFPB) has developed training for front-line service providers that does not require them to be certified financial planners, but gives them and the individuals they serve easy access to a variety of tools, all free, all in the public domain (not copywritten), and training opportunities for their implementation. The CFPB’s Your Money, Your Goals – A Financial Empowerment Toolkit starts with a financial health self-assessment that helps you identify the problem areas for each of the individuals you serve, in their own unique situations, and focuses on 1) what they know, 2) how they feel, and 3) their experiences. It then provides a cross-reference to specific resources and easy-to-use tools in nine (9) critical and stand-alone areas to address those concerns and potential obstacles:
- Setting goals and planning for large purchases
- Saving for emergencies, bill, and goals
- Tracking and managing income and benefits
- Paying bills and other expenses
- Getting through the month
- Dealing with debt
- Understanding credit reports and scores
- Money services, cards, accounts, and loans: Finding what works for you
- Protecting your money
These toolkits are available at no charge, and can also be downloaded and printed directly from the CFPB. Additional resources have been developed to expend this toolkit to serve three (3) distinct groups:
- Your Money Your Goals – Disabilities Companion Guide
- Your Money Your Goals – Focus on Native American Communities
- Your Money Your Goals – Focus on Reentry
From an Employment Network’s perspective, these tools provide a way that we can partner more effectively with State Vocational Rehabilitation agencies (SVR) and other community partners to help our beneficiaries be more successful, which in turn helps us grow our programs and fortifies a constructive working relationship with SVR. We can add the financial health assessment to our initial intake, and include the specific interventions CFPB recommends in the IWP. This increases the value of our services, and as research suggests, makes the beneficiary more likely to continue in the TTW program and reinforces positive work values, thereby increasing outcome payments to the EN. These interventions are no cost to us, are not copywritten so we can put our own logo on them and change them as we wish, and we can use individual modules independently as needed without going through the whole list.
The CFPB web site is https://www.consumerfinance.gov/practitioner-resources/your-money-your-goals/ Check it out! And while you are exploring these resources, consider the array of free, online training and services provided by the Federal Deposit Insurance Corporation (FDIC) through their Money Smart program at https://www.fdic.gov/consumers/consumer/moneysmart/