UNDERSTANDING THE KEYS TO FINANCIAL STABILITY
Financial Education, Coaching and Skill Building/ Financial Stability Case Management
The continuum of services an individual receives is vital in their journey from financial crisis to empowerment. It encompasses case management, financial education, and coaching/skill building, which are essential tools to address the unique needs of households. This wide range of services is necessary due to the pervasive nature of poverty and economic vulnerability in America. Shockingly, nearly 60 percent of Americans between the ages of 20 and 75 will experience a year below the official poverty line, and 79 percent will face a year of economic insecurity (Rank and Hirschl 2015). Life events such as illness, job loss, or accidents can easily plunge households into turmoil, especially considering that more than one-third of Americans do not have $400 to cover unexpected expenses (Board of Governors for Federal Reserve System 2022). Furthermore, a lack of financial knowledge costs individuals an average of $1,819 per year (National Financial Educators Council 2022).
In Kansas City alone, nearly 200,000 people live below the federal poverty level, meaning a single person under 65 years old is living off $14,097 and a single adult with one child is living off $18,677 (U.S. Census Bureau 2022c). Almost 500,000 people live below 200 percent of the federal poverty level (U.S. Census Bureau 2022c). Poverty is not equally distributed throughout the Kansas City metro as Jackson County, Missouri and Wyandotte County, Kansas has the highest percentages of people living in poverty (U.S. Census Bureau 2022c). Significant disparities exist when looking at poverty in terms of race as the percentage of people living in poverty is three times greater for individuals who are Black and twice as great for individuals who are Hispanic or Latino/Latina than their white counterparts (U.S. Census Bureau 2022c).
Rectifying these disparities and inequities requires a complex set of programs and assistance. It is crucial to link assistance and housing to supportive services that help individuals achieve and sustain the appropriate level of stability for their circumstances. Case management has proven to be an indispensable component in creating financial stability for households, particularly when embedded within trusted community organizations (Brown and Robinson 2016; O’Brien and Gillespie 2020). The inclusion of case management significantly improves the short-term and long-term financial capabilities of households (Lin et al. 2022). Moreover, programs such as Individual Development Accounts (IDA) that encourage savings, and Volunteer Income Tax Assistance (VITA) sites that provide free tax return preparation assistance can further support households in stabilizing and empowering themselves. In 2023, United Way’s 211 partnered with the KC MetroTax Coalition and handled 3,180 income tax related calls, including scheduling appointments for VITA sites.
United Way is dedicated to supporting robust case management programs integrated within human service agencies, encompassing financial education, coaching, and skill building. These comprehensive services are essential to our community’s efforts in assisting those who are struggling. As part of the Family Empowerment Initiative (FEI), supported in part by the Siemer Foundation, United Way partners with six nonprofits paired with six school districts across the metro, employing a two-generation approach to reduce homelessness and promote academic success for children. In 2022, FEI served 143 individuals, including 1,229 children and 1,003 school-aged children, with 97 percent of these children remaining enrolled in school while their parent/caregiver received case management and financial assistance. By providing a web of services and support, United Way aims to empower families, foster stability, and create a brighter future for our community.
Workforce readiness and employment support
Education, combined with skills development and employment support, is paramount for enhancing household economic mobility, addressing the demands of employers, and driving regional economic growth. A significant earnings gap has emerged between individuals with post-secondary education/credentials and those without, resulting in increased labor market inequality (National Center for Education Statistics 2022). In Kansas City, the impact of education on poverty is evident, with the highest percentage of individuals over 25 living in poverty having less than a high school diploma, and the largest number of individuals in poverty having only a high school diploma (or equivalency) (U.S. Census Bureau 2022c). This disparity disproportionately affects marginalized groups, including people of color, new immigrants, individuals with disabilities, residents of rural and socio-economically segregated communities, and those involved in the criminal justice system (Perez-Johnson and Holzer 2021). A comprehensive approach is necessary, combining programs that foster a future-ready workforce, improve college readiness and success (particularly for first-time college students), establish career pathways for youth, and provide adult learners with the necessary support to escape poverty. Workforce development policies, programs, and practices are crucial for advancing equity in educational and economic opportunities across America (Perez-Johnson and Holzer 2021). United Way recognizes the significance of investing in agencies and collaborations that support a spectrum of workforce readiness initiatives and employment services essential for achieving economic equity and fostering the region’s growth. United Way supports roughly 30 agencies who offer employment preparation, financial coaching, and case management to empower the unemployed or underemployed, enabling them to enter or re-enter the workforce.
Supports for People with Involvement in the Justice System
Supporting individuals who have been involved in the justice system is crucial for breaking down barriers to housing, economic mobility, and other opportunities. By doing so, we can reduce recidivism rates and provide individuals with a genuine second chance at building a better future. It is estimated that nearly one in three Americans, ranging from 70 to 100 million individuals, have some form of criminal record (Bala and Vallas 2020). The consequences of these records extend far beyond the legal system and create significant social and economic obstacles, including difficulties in obtaining employment, housing, and benefits (American Bar Association 2018).
The impact of arrest, incarceration, and the collateral consequences of a criminal record disproportionately affect Black, Indigenous and People of Color (BIPOC) communities, minorities, and economically disadvantaged populations. For instance, black men are six times more likely to be incarcerated compared to white men, highlighting the racial disparities within the justice system (Vallas and Dietrich 2014). It is essential to recognize that, for millions of Americans, a criminal record becomes a life sentence to poverty (Bala and Vallas 2020). The economic cost of excluding these individuals from the workforce is estimated to range from $78 to $87 billion annually in Gross Domestic Product (GDP) (Bucknor and Barber 2016).
United Way is dedicated to investing in programs that provide comprehensive support for individuals with justice involvement, aiming to create pathways for employment, housing, and access to necessary services and benefits. We collaborate with multiple agencies to offer a range of services tailored to the unique needs of justice-involved individuals. This includes transitional living facilities for youth involved in the justice system through our partnership with Cornerstones of Care, criminal record expungement services provided by Kansas Legal Services, and reentry support for individuals reintegrating into society after prison or other interactions with the criminal legal system offered by Journey to New Life, the Village Initiative, and JustUsSystem.
By investing in these programs and services, United Way is committed to breaking down barriers, promoting inclusivity, and providing individuals with the tools and opportunities they need to rebuild their lives and contribute positively to our community. We believe in the transformative power of second chances and strive to create a society that embraces rehabilitation, support, and reintegration for justice-involved individuals.
Thank you to research and community partners for supplying information and support critical to this community needs index including: US Federal Reserve, National Financial Educators Council, US Census Bureau, Siemer Foundation, National Center for Education Statistics, Kansas Legal Services, Cornerstones of Care, JustUs System, Journey to New Life, The Village Initiative.