Friday, November 16th, 2018
Category: Low Income Populations
Delivering Financial Counseling to Families with Low Incomes through the Federal Government's Largest Wealth-Building Program for Families with Low Incomes
For the past 25 years, the Family Self-Sufficiency (FSS) program has been one of the Department of Housing and Urban Development's best kept secrets. The program encourages families receiving federal housing assistance to increase their earned income and then enable families to build savings through the process of paying rent. Despite being the federal government's largest wealth-building program for families with low incomes, it has been underutilized and under-optimized for decades. Compass Working Capital, a Boston-based financial services nonprofit, has spent over eight years unpacking the program's potential by combining this powerful savings incentive with high-quality financial counseling and coaching. A rigorous evaluation of the organization's FSS programs was recently completed by Abt Associates, a leading, global research firm. The initial report on the study found that the organization's FSS program produced strong earnings gains, a reduction in Temporary Assistance for Needy Families (TANF) program expenditures and improvements in credit and debt outcomes that exceeded available benchmarks. A subsequent cost-benefit analysis found that the program's benefits greatly outweighed its costs. Compass is interested now in expanding the scope and impact of the FSS program on a national scale, in large part by engaging practitioners in the financial counseling and housing fields to help unpack the program's potential in their local communities. This work has been buffeted by growing interest in Congress and at HUD to streamline and improve the FSS program and make it easier for more families to access the program. These changes have created conditions by which practitioners have the opportunity to help shape and advance this powerful program to benefit a broader share of eligible families in communities across the country. The purpose of this practitioners' forum presentation will be to encourage practitioners to consider how their expertise in financial counseling could be leveraged to support families with low incomes to become more financially secure and to reach major financial goals through the FSS program. The presentation will explore the organization's model for the FSS program, the tools and practices that the organization has developed to provide financial counseling to families with low incomes, its partnerships with housing providers, and the process of engaging an outside evaluation partner to conduct a rigorous program evaluation to measure the impact of this type of program.
Questions or Implications for Researchers: The global research firm Abt Associates conducted a rigorous, multi-year evaluation of Compass' FSS program model. At the conclusion of that study, the evaluation team offered several recommendations for future research opportunities, including: (a) extend initial evaluation to track outcomes over a longer time period and increase sample size to allow for separate analysis of earnings impacts at each program site and for key subgroups, such as households with different levels of starting earnings, and (b) conduct a randomized controlled trial to generate the highest quality of data on the effects of the organization's FSS model.