Financial well-being means having financial security and freedom of choice, both now and into the future. Research on the state of financial well-being in the United States and what drives it is now available for the first time.
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Growing old is nice, but boy is it costly (Links to an external site)
Half of Americans have no retirement savings, according to a Brookings Institution article of three years ago. Hasty reactions to market fluctuations result in escalating debt, according to Michael Grinstein-Weiss, associate professor of social work at Washington University in St. Louis and associate director of the Center for Social Development. Shea-Taylor, B.
Financial Planning: Prepare now, avoid bankruptcy later (Links to an external site)
In 2015, Brookings Institution economist Michal Grinstein-Weiss testified before the Senate Special Committee on Aging that 45 percent of Americans had no retirement savings. Without corrective action, we can expect the rate of elder bankruptcy to persist or even increase in coming years. Merrel, S.
Israel’s First Social Impact Nudgeathon (Links to an external site)
The study of our own irrationality is called Behavioral Economics. And, thanks to Professors Dan Ariely and Michal Grinstein-Weiss, we held the first-ever social impact Nudgeathon at JDC Israel last week to make sure JDC Israel’s critical programs factor in the inherent irrationality of human decision making. Fishman, O.
Behavioral interventions to increase tax-time saving: Evidence from a national randomized trial
Too many households have too little set aside for emergencies, long-term goals, or retirement. This study presents evidence from the Refund to Savings Initiative, a large-scale randomized experiment testing interventions to increase household savings by encouraging filers to set aside a portion of their tax returns. Grounded in techniques of behavioral economics, these interventions are […]
The role of choice architecture in promoting saving at tax time: Evidence from a large-scale field experiment
Tax refunds give many low-and moderate-income (LMI) households a rare opportunity to save for unexpected expenses. We conducted three experiments aimed at increasing tax-time savings by LMI consumers. In a large field experiment, the most effective intervention increased the average savings deposits by about 50%. Delivered as people filed taxes online, this treatment consisted of […]
Effects of a tax-time savings intervention on use of alternative financial services among lower-income households
Alternative financial services (AFS) such as check cashing and payday loans may help unbanked households meet transaction and credit needs, yet often at a very high price. Saving tax refunds can help low- and moderate-income (LMI) households build emergency savings as a way to reduce dependence on AFS and cope effectively with irregular cash flows […]
Home delinquency rates are lower among ACA Marketplace households: Evidence from a natural experiment
This brief uses administrative income tax data coupled with survey responses from roughly 5,000 households living near the poverty line to estimate how access to the Affordable Care Act’s health insurance Marketplaces have affected households’ experiences of extreme illiquidity, which is measured by delinquencies on home payments. To estimate this relationship, we exploit a natural […]
Coping with a crisis: Financial resources available to low- and moderate-income households in emergencies
Using data from tax records and a longitudinal survey, this brief investigates the choices low- and moderate-income households make about their tax withholding and their preferences for withholding. The relationship between withholding preferences and the use of the tax refund, measures of material hardship, and the use of alternative financial services is also explored. We […]
The experience of volatility in low- and moderate-income households: Results from a national survey
Roll, S. P., Mitchell, D. S., Bufe, S., Lynne, G., & Grinstein-Weiss, M. (2017, October). The experience of volatility in low- and moderate-income households: Results from a national survey (Issue Brief). Washington, DC: Aspen Institute and Center for Social Development.
Responses to and repercussions from income volatility in low- and moderate-income households: Results from a national survey
Roll, S. P., Mitchell, D. S., Holub, K., Bufe, S., & Grinstein-Weiss, M. (2017, December). Responses to and repercussions from income volatility in low- and moderate-income households: Results from a national survey (Issue Brief). Washington, DC: Aspen Institute and Center for Social Development.
Assessing retirement needs and interest in myRA: Findings from the Refund to Savings Initiative
4. Roll, S. P., Oliphant, J. E., Perantie, D. C., Grinstein-Weiss, M., & Davison, G. (2017). Assessing retirement needs and interest in myRA: Findings from the Refund to Savings Initiative (CSD Research Report No. 17-16). St. Louis, MO: Washington University, Center for Social Development.
Racial disparities in education debt burden among low- and moderate-income households
Grinstein-Weiss, M., Perantie, D. C., Taylor, S. H., Guo, S., & Raghavan, R. (2016). Racial disparities in education debt burden among low- and moderate-income households. Children and Youth Services Review, 65, 166–174. doi:10.1016/j.childyouth.2016.04.010
Student debt and hardship: Evidence from a large sample of low- and moderate-income households
Despard, M. R., Perantie, D. C., Taylor, S. H., Grinstein-Weiss, M., Friedline, T., & Raghavan, R. (2016). Student debt and hardship: Evidence from a large sample of low- and moderate-income households. Children and Youth Services Review, 70, 8–18. doi:10.1016/j.childyouth.2016.09.001
Do tax-time savings deposits reduce hardship among low-income filers? A propensity score analysis
A lack of emergency savings renders low-income households vulnerable to material hardships resulting from unexpected expenses or loss of income. Having emergency savings helps these households respond to unexpected events, maintain consumption, and avoid high-cost credit products. Because many low-income households receive sizable federal tax refunds, tax time is an opportunity for these households to […]
Support for a tax-time savings policy: Interest in deferring tax refunds with matched incentives
The Earned income tax credit (EITC) is regarded as one of the largest antipoverty policies in the United States. Unlike traditional cash benefits, the EITC is received as a lump sum tax refund. This research brief looks at new proposals from policymakers and advocates that seek to increase savings around tax time. These proposals could […]
Characteristics and hardships associated with bank account ownership among Refund to Savings participants
Having a bank account is one important way for households to securely accumulate savings, build credit, and earn interest on assets. Nationally, 7.7% of households are unbanked—lacking both a checking and a savings account. One proposed step toward financial inclusion is to encourage unbanked households to open accounts and deposit refunds into savings at tax […]
The role of health insurance in the financial lives of low- and moderate-income households
Health insurance is an important resource for enabling access to and use of medical care, and is associated with reduced risk for mortality and poor health outcomes. Health insurance also protects households from incurring major medical expenses and unmanageable levels of medical debt. About a quarter of a sample of low- and moderate-income (LMI) tax […]
Financial anxiety in low- and moderate-income households: Findings from the Household Financial Survey
Despite significant gains in the U.S. economy following the Great Recession, finances remain a common source of stress for many American households. In 2016, 52% of U.S. workers reported that their financial position made them stressed, and research reveals that stress and anxiety associated with finances are particularly common among low-income Americans. In this brief, […]
Delaying Tax Refunds for Earned Income Tax Credit and Additional Child Tax Credit Claimants
The Protecting Americans from Tax Hikes Act of 2015 requires the IRS to delay tax refunds for taxpayers who claim an earned income tax credit or additional child tax credit on their returns until at least February 15. The delay could help the IRS better check claims for these credits. But this new requirement will […]
Senators propose ‘Rainy Day’ act to urge Americans to save (Links to an external site)
U.S. Sens. Cory Booker (D-NJ) and Jerry Moran (R-KS) proposed a plan to encourage Americans to build emergency funds. Under the bipartisan Refund to Rainy Day Savings Act, tax filers who receive a direct-deposit tax refund would be allowed to defer 20 percent of their refund by opting into the Rainy Day Savings Program on their 1040 tax form.
WashU Expert: Getting a tax refund? Consider saving it (Links to an external site)
Refund To Savings (R2S), is a collaboration of academic researchers from the CSD, Duke University and Intuit Inc., the maker of TurboTax tax preparation software. R2S builds a saving-promotion experiment as a randomized controlled trial into the TurboTax Free File Online product that is available free to low- and moderate-income households.
Use of alternative financial services in low- and moderate-income households: Evidence from Refund to Savings
Unable to conduct everyday financial transactions without a bank account or in need of flexible, shortterm credit, many low- and moderate-income (LMI) households turn to alternative financial services (AFSs). This brief summarizes research on AFS use among LMI tax filers participating in the Refund to Savings (R2S) Initiative. We make an important contribution to AFS […]
Refund to Savings 2013: Comprehensive report on a large-scale tax-time saving program
Improving the financial security of low- and middle-income households through the savings of federal tax refunds is the central mission for the Refund to Savings (R2S) initiative. It is important to understand the context in which those households are trying to save and the methods of coping with contingencies when savings are not available. Such […]