Financial counseling and coaching for those with lower incomes is beginning to hit its stride as a field. In fact, sitting down and literally helping someone individually with their financial challenges and goals (not just teaching them about the basics) is emerging as the next public service in cities across the country and even beyond. Exciting stuff . . . and no wonder. Community practitioners, government leaders, private funders, and local municipalities are developing and delivering services that are finally demonstrating both impact and the capacity for scale.

But as these efforts attract and sustain more resources, particularly government dollars, it is critical that the financial counseling and coaching field achieves professional maturity.
The four basic pillars of any professional field—quality, consistency, accountability, and community—are attracting increasing focus from financial empowerment stakeholders across multiple sectors. When the Cities for Financial Empowerment Fund and Citi Community Development released a call for essays to gather observations and best practices on financial counseling and coaching through the lens of these professional pillars, we were astonished by over 100 responses from across the country.

As you read through the essays, you’ll notice that within each of the professional pillars, experiences and priorities span a broad and energizing spectrum. Yet ringing clearly through each essay we were able to include here, and the dozens and dozens we were not, is a strong stream of passionate commitment to, and tangible consensus for, providing services at a professional level, a field ready to be held to that standard, and the appetite to work together to support that evolution.

Thank you to Citi Community Development for their longtime partnership and support of this work; and thank you for joining us in this promising conversation.


Jonathan Mintz
President and Chief Executive Officer
Cities for Financial Empowerment Fund, Inc.

From Our Partner

  

Bob Annibale leads Citi’s partnerships with global, national and local organizations to support inclusive finance and community development through economic empowerment, focusing on responsible and accessible finance; financial coaching and asset building; neighborhood preservation and revitalization; access to college education; and small business and microenterprise development.

The field of financial empowerment has reached an inflection point. As of this writing, nearly thirty city governments have launched or are in the process of launching programs designed to enable financially vulnerable households to achieve a more secure financial future, and hundreds of organizations across the United States are delivering a suite of these services to their local communities. Companies and philanthropic organizations are more engaged than ever, providing support to enable the development of innovative new programs or the replication and scaling of successful ones. And practitioners continue to gather data and stories from the field -- highlighting what works and what doesn’t, and identifying current and emerging areas of need.

Yet despite the great progress that has been made, the need remains greater than ever. According to the FDIC, almost 93 million people live in unbanked and underbanked households in the United States – a group large enough to form the 13th most populous country in the world, larger than the populations of France, the U.K. or Germany.  Nearly ten million households do not have a bank account, and more than 50 million adults are resorting to alternative -- and often predatory -- credit products. The Consumer Financial Protection Bureau (CFPB) has found that 26 million consumers have no credit score and are considered “credit invisible”, and an additional 19 million were “unscorable” due to thin or nonexistent credit data. And according to data from  FamilyAssetsCount.org, a collaboration between the Corporation for Enterprise Development (CFED) and Citi Community Development, nearly half of all U.S. households are “liquid asset poor” – that is, they do not have sufficient savings to sustain three months at the poverty level in the event of a significant interruption of income, such as a large medical expense or the loss of a job.

In short, in America in 2016, too many families and individuals lack financial access and financial resiliency to build assets in an increasingly complex and expensive economy.

As one of the field’s earliest and staunchest supporters, Citi considers financial empowerment to be a key ingredient for building more inclusive cities. Armed with the right tools, expertise and partnerships,  government, community organizations and the private sector have the power to improve access, affordability and resiliency for vulnerable families and communities: Access to safe, appropriate financial products and services, or to refundable tax credits like the EITC; Assistance with finding affordable credit, housing or banking; and one-on-one financial counseling to encourage saving and building up the financial resiliency to safeguard against the unexpected.

But the industry has reached a point where simply growing is not enough. In order to reach the next level of effectiveness, it has to mature as a field. It has to professionalize.

That’s why we have been thrilled to see so many of the leading experts in one-on-one financial counseling stepping forward to offer their unique insights and expertise to this first discussion of professionalization of financial empowerment services in the U.S. Their contributions take on a number of critically important questions from a range of different industry perspectives: how do we best measure and evaluate impact? How do we define national standards, ensure organizations adhere to them? How do we replicate programs and share best practices across a complex and heterogeneous economic landscape so that national standards rise?

Ultimately, we all have the same goal at heart: to enable vulnerable families to build a more secure financial future, and expand economic opportunity for the communities in which they live -- and to do this as effectively as we can.  We look forward to seeing how this journal prompts the kinds of discussion and action that shape the field and take it to the next level.

Bob Annibale
Global Director
Citi Community Development and Inclusive Finance