A note from EARN’s CEO:
Three months ago I dislocated my knee cap dancing at a friend’s wedding in Puerto Rico. The fallout from my simple misstep on the dance floor was significant: an ambulance ride, the emergency room, an MRI, knee surgery, several weeks of missed work, and months of physical therapy appointments. My life turned upside down in a split second.
The Aspen Institute’s Financial Security Program’s new report – “Income Volatility: Managing the Swings” – provides an actionable solutions framework for minimizing the impact of income volatility and expense shocks, particularly for low-income households.
Two of the most promising solutions? Savings and Insurance.
But as the report notes, insurance (including health, homeowners/renters, automobile, life and disability) can be hard for low-income families to access and may not cover all of the costs. A poll conducted by the New York Times and the Kaiser Family Foundation found that 20% of Americans with insurance still struggle to pay their medical bills.
When it comes to health outcomes, we know that regular savings has a positive effect on more than just your bank account. EARN Savers consistently report significant increases in their general sense of security and wellbeing – 80% of EARN Savers report an increase in confidence and self-esteem, and 92% exit an EARN program with a strategy to handle a financial emergency.
To further test the transformative power of savings, EARN is partnering with Stanford School of Medicine to launch a Randomized Control Trial (RCT) to measure the impacts of the EARN Starter Savings Program on Savers’ financial, physical, and mental health and well-being. Financial indicators tracked include savings behaviors, spending habits, and budgeting, while measures for physical and mental health include optimism, depression, perceived control, days of work missed due to physical or mental health problems, and consumption of alcohol and tobacco products.
Our investment in a technology powered savings solution is designed to help the whole field generate the insights we need to find better solutions for hard-working families.
Oh, and that second wedding I mentioned? That was mine.
Leigh is the president and CEO of EARN.