Best Practices in Asset Building
Bank on Kalamazoo meeting, February 2010.

Asset building policy and programs seek to address issues of poverty and financial insecurity through asset accumulation by working families at all income levels. Assets include savings accounts, homes, education, and small businesses. The ownership of assets is critical to financial stability because assets provide financial resources and earned income that can be used to weather financial crises. The Michigan Asset Building Policy Project (ABPP) coordinates the Michigan Asset Building Coalition (ABC) to advance asset building policy initiatives and support diverse asset building practices across the state.

While universal access to asset building opportunities is the main goal of asset building, low-income earners have significantly fewer opportunities for saving and investing than middle to high-income earners.  Therefore, asset building policy often targets the low income population.  Common asset building practices include Individual Development Accounts (IDAs), 529 college saving plans, and initiatives like Bank On that provide access to financial services.

CEDAM members are innovating in asset building initiatives.

Oakland Livingston Human Service Agency (OLHSA) coordinates the Michigan IDA Partnership (MIDAP), which offers matched savings accounts to help low-income workers build assets.

Inner City Christian Federation and Community Action Agency – Jackson also offer accounts through MIDAP to provide a 3-to-1 match for savings toward a home purchase and a 2-to-1 match for savings for education or small business startup.

Northern Initiatives supports rural entrepreneurs through microenterprise loans that can be used for various business costs, including start-up capital, business acquisition, equipment upgrades and facility expansion.

The Kalamazoo-based Poverty Reduction Initiative (PRI) is tackling issues of poverty through programs focused on education and access to economic opportunity. PRI is designing a Bank On program for Kalamazoo that will connect unbanked residents with good financial services targeting their specific needs.