Reflect on the feeling of security you derive from your growing retirement savings, your college degree, the equity in your home, and your stash of emergency cash. Then picture all of that disappearing and the challenges you would face in building it all up again from nothing. Now imagine setting out to attain those same assets, which many of us take for granted, as a single mother of four overcoming homelessness and unemployment.

Such was the case with Paulette, one of the remarkable clients of San Jose-based Opportunities Fund (formerly Lenders for Community Development). When Paulette found Opportunities Fund through a social service agency, she had  begun to stabilize her life and needed a plan for the future. She joined Opportunities Fund’s matched savings program and began to attend financial education classes. After beginning a job training program, she started saving a minimum of $20 each month and learned to stick to a budget and avoid going further into debt. She was able to improve her credit score and land increasingly better paying jobs. At the end of three years, Opportunities Fund’s program matched her savings two to one to equal $6,000.
Read moreShe used her savings to buy a home with her fiancé for her four children. Because of the financial education she received, she knew how to obtain a mortgage she could afford and avoided variable interest-rate financing. She continues to make on-time monthly payments, and has set as her next financial goal to save enough to build a six-month nest egg for expenses. For Paulette, disciplined savings gave her a new sense of security.

Even a few hundred dollars in savings and discretionary investment resources can begin to stabilize families, buffering them from the inevitable employment interruptions and illnesses that can otherwise become crises without savings.

In a very fundamental way, having even a modest amount of savings and financial assets gives people permission to shape their economic futures. Even a few hundred dollars in savings and discretionary investment resources can begin to stabilize families, buffering them from the inevitable employment interruptions and illnesses that can otherwise become crises without savings. A growing bank account provides a family with a reason to believe in themselves and their potential, a space to imagine a future better than the present, an ability to plan and prepare for that future, and the ability to invest in their children. Substantial and convincing evidence indicates that asset holding increases economic security, encourages initiative and risk taking, builds economic confidence, increases home and business ownership, boosts financial skills, strengthens families and communities, and improves the prospects of future generations.

This is an excerpt from The NEXT American Opportunity. The full text can be downloaded as an Adobe PDF Document.