National Perspective on Financial
Literacy & Asset Development for
People in Mental Health Recovery
Judith A. Cook, PhD
Professor & Director
University of Illinois at Chicago, Department of Psychiatry
Presented at NYAPRS 7th Annual Executive Seminar on
Systems Transformation
April 27, 2011, Albany, NY
A Word of Thanks to our
• U.S. Department of Education, National
Institute on Disability & Rehabilitation
• Substance Abuse & Mental Health
Services Administration, Center for
Mental Health Services
People in mental health recovery
need to be on the road to
economic security
Financial Literacy
Financial literacy is the ability to understand
money and how to manage one’s own
personal finances through financial planning.
Low-Income People in
Recovery May Feel Financial
Planning is Futile
just sat down the other day and
wrote out checks with which to pay
my bills and find out I’ve already
spent my money before I even have
it. There was no fat to trim, nothing
to budget.”
Woman in Chicago
A Fatalistic View Can Get in the
Way of Planning
“I think when I have money, ‘You
know what? I may not be here
tomorrow. Look at my friend who
passed away suddenly.’ Then I
don’t care about the end of the
Man from Georgia
UIC Financial Education Curriculum
• Lesson 1: What’s Important to You? values,
needs vs wants; identifying financial goals, budgeting
• Lesson 2: Income vs. Expenses difference
between fixed vs. flexible expenses; developing a
savings plan
• Lesson 3: Managing Your Debt controlling debt,
how to increase your income, 101 ways to save $
• Lesson 4: Understanding Credit understanding
your credit report; managing credit/debt problems
• Lesson 5: Using Financial Institutions checking
& savings accounts, direct deposit, debit cards,
using ATMs, online banking, bank loans
• Lesson 6: Building Consumer Skills smart
shopping, spending traps, spotting fraud,
consumer rights
Financial Education Course
Evaluation: Pre-Post Test Results
Statistically significant increases (p<.10 by 2-tailed
significance on paired-t-test) were observed on:
How often do I...
• Write down my financial goals.
• Write out a spending plan that includes savings for goals
and emergencies.
• Use coupons.
• Keep track of my spending.
On a scale from 1=not comfortable to 5=very
• What is your comfort level with your knowledge of financial
terms and concepts?
• What is your comfort level with applying what you learned?
In Students’ Own Words…
• “I am so aware now [about] what I am buying or
what I am choosing not to buy. I use to go on
sprees, now I am choosing not to waste money or
overspend. I make mistakes sometimes but now I
track expenses all the time. I am also more aware
of credit card debt.”
• “This course was a mirror and I’ve now begun to
pay more attention to my spending.”
• “I am saving in an envelope for vacation. And
earned money by selling two things I don’t use.”
• “I am now more motivated to address my debt, I’m
working on agreements to pay off debt and I have
a better understanding of my financial situation.”
You are like everyone else…
Asset Accumulation
Asset Accumulation has
Documented Psychological
enhanced personal efficacy
greater personal control
feelings of empowerment
future orientation
Assets as Important as Income
to Enhancing Quality of Life
• Panel Study of Income Dynamics (Yadama and
Sherraden, 1996) used simultaneous equation
• Found that assets had a positive effect on
expectations and confidence about the future
making specific plans with regard to work and family
more prudent and protective personal behaviors
more social connectedness with relatives, neighbors
and organizations
• Effects of assets in this analysis were found to be
equal to those of income in their association with
positive outcomes
Individual Development Account - IDA
• Established by Assets for Independence Act
• Run by U.S. Health & Human Services Office
of Community Services under the
Administration for Children & Families.
Save earned income for purchase of 1st
home, small business capitalization, or postsecondary education
Participants must earn less than 200% of
poverty level ($21,780/yr for family of 1)
Savings must be from earnings
Locked box accounts - emergency access
SSI/SSDI & TANF recipients are eligible
IDAs - MATCHED Savings Accounts
Federal Government
Matches $20
$20 + $20 + $20 = $60
Local Bank or Philanthropic
Organization Matches $20
Person Now
Has $60
IDA Programs – Savers with
Psychiatric Disabilities
New Hampshire
• Two programs: Dollars & Sense Credit Union
Demonstration Project; Volunteer Income Tax
Assistance & Financial Education Study
State universities coordinated the programs as
part of research studies: U of NH; Southern NH
4 savers with psychiatric disabilities in each
3:1 match (Dollars & Sense), 4:1 match (VITA)
New Hampshire Community Loan Fund
provided the match
Banks: Northeast Credit Union (Dollars &
Sense), Citizens Bank (VITA)
1 saver matched (Dollars & Sense) for a microenterprise, 2 matched (VITA) for post-secondary
education & a micro-enterprise
New Jersey
• Collaborative Support Programs of New
Based at a peer-run self-help center
41 savers in MH recovery
4:1 match for advanced education & microenterprise development; 2½:1 for home
Local match from state MH authority &
Wachovia Bank
Commerce Bank held IDA accounts
Outcomes: 19 savers matched, 3 homes, 9
degrees, & 7 micro-enterprises
• Mental Health America of LA IDA Program
• Based at a national mental health advocacy
organization’s state affiliate
10 savers
2:1 match
Local match from State Office of Mental Health
Chase Bank
9 savers matched, 1 micro-enterprise, 9 home
repair purchases
• Cook Tribal Inlet Council IDA
Based at a social service agency for Alaska natives (in
their Employment & Training Services Department)
246 participants (savers with MH/SA disabilities & their
family members)
5:1 match
Local match from the Alaska Mental Health Trust
Wells Fargo Bank
107 savers matched, 53 home purchases, 44 postsecondary education, 10 micro-enterprises
• UIC/Thresholds IDA Program
• Run by a state university research center
& based at a community mental health
center’s supported employment program
5 savers
2:1 match
Local match from the Rebecca Susan Buffett
Charter One Bank of Chicago
3 savers matched, 1 micro-enterprise, 2 postsecondary education
• CA Individual Self-Sufficiency
Planning Project
Not IDAs but Independence Accounts through
the SSA waiver program – people could save
up to $8,000/year without penalty
8 savers with psychiatric disabilities who were
SSI beneficiaries
No match
Local banks held accounts
Matching not possible, savers purchased postsecondary education, moving expenses,
transportation, vacations
Summary of Lessons Learned by
• Savers in MH recovery can save & match
Many savers need ongoing social & emotional
support, with peer support essential
Need for employment services to deal with job loss &
work issues
Lack of affordable housing stock was a barrier
Multiple life issues impacted savers’ ability to match
SSA disability benefits issues remained problematic
Multiple collaborative relationships require
administrative time & funding
Array of Services to Support
Successful Saving
Employment Support
Ongoing Social & Emotional Support
Clinical Services
Financial Literacy Education
Asset-Specific Education
Benefits Planning Assistance
Which is the best approach?
• Should we be mainstreaming people
with disabilities into existing IDA
• Should we be creating IDA programs
that are tailored to the needs and
circumstances of individuals with
(AFI, 2009)
Essential Administrative Partnerships
1. MH service delivery or advocacy organization,
peer-run program, or nonprofit organization with
MH expertise that serves as the program "home"
Program administrator funded directly by AFI to
operate IDAs & draw down federal match
Bank or other financial institution that holds the IDA
savings accounts
State or local government or tribal authority,
community development fund, or philanthropic
organization that provides local matching funds
Local organizations that promote financial literacy,
offer asset-specific education & help, & provide
financial services & supports
Thank You!
UIC National Research & Training Center on
Psychiatric Disability
Financial Education Curriculum
Report on IDA Programs

National Perspective on Financial Literacy & Asset Development