Financially Vulnerable Families

by David Levine, President and CEO

The Federal Reserve Bank of San Francisco released a book whose authors focus on how to strengthen the financial future of low-income and vulnerable families.

One author noted that, as largely unbanked households, low-income families are not able to build savings or smooth their consumption through standard financial vehicles (like savings accounts).

As a result, without that basic ability to achieve lifetime financial goals, these families underinvest in their children.  But this underinvestment is a vicious cycle. The children in these low-income families will then have fewer marketable skills, lower productivity, and decreased lifetime earnings.

You can read a summary of the book here:  What It’s Worth Book Summary

The book truly demonstrates how poverty can become multigenerational and endemic within a family — a much harder outcome to change.