Research Finds Low-Income Urban Youth Will Save Consistently Given Access to Savings Tools
FOR IMMEDIATE RELEASE: November 1, 2016
America Saves to Release Report at Event in Washington D.C.
80% of Young Workers Established a Savings Pattern, an Increase of 54%
Washington, D.C. – An eight-month long study released today by America Saves on the impact of the America Saves for Young Workers Program reveals that low-income urban youth will save consistently when given access to savings accounts, direct deposit, and goal setting. America Saves is featuring the study at the event “Youth Employment Programs as Pathways to Savings” tomorrow in Washington, D.C.
With the generous support of JP Morgan Chase & Co., America Saves contracted with C+R Research on an eight-month long study conducted in four separate waves of 100 youth each. Over the four waves, a total of 238 youth participated. These youth ranged in age from 16–20 years old, participated in their summer employment program, and had low or moderate family incomes. Highlights from the report include:
- Following their summer employment, 58% of youth, on average, owned savings accounts, a 66% increase in ownership.
- Following their summer employment in 2015, youth ownership rates for savings accounts exceeded that of national low-income teens by 34%.
- 76% of young workers were given a choice of how to deposit their pay, and an average of 66% self-elected to use direct deposit.
- Following their summer employment program, and corresponding involvement in the America Saves program, 80% of young workers had established a savings pattern, an increase of 54%.
- By August of 2015, 61% of young workers had met the pledge goal they had set at the beginning of their summer employment.
- Savings amounts remained relatively steady over time with an average of about $400 saved.
- Youth continued to save after their summer work experience with 61% of young workers having made a deposit 8 months after their summer employment ended, despite only 38% of those youth being formally employed.
“This is the first time that many of these youth will receive a paycheck and the America Saves for Young Worker program plays a pivotal part in motivating them to save part of their pay for items they want and need, and for those unexpected expenses,” said George Barany, Director of Strategic Initiative for America Saves. “This special moment in time then becomes an opportunity for employment programs, financial institutions, and America Saves to show young workers how to save and, more importantly, help them set up the systems to save automatically.”
To highlight the report, America Saves is hosting an event in Washington, D.C. tomorrow from 1pm – 3pm entitled “Youth Employment Programs as Pathways to Savings.” In addition to the release of the research, the event includes testimonials from young workers who completed the program, programs that are successfully utilizing the program, and financial institutions that are providing unique saving products and services. View the webcast here.
View the webcast: View the webcast here
About America Saves for Young Workers: America Saves for Young Workers is a free program for summer youth employment programs (SYEP) that takes under ten minutes for youth employees to complete and highlights the use of direct deposit to put money away for both spending and saving. The program has proven to motivate most individuals to make a savings commitment and SYEP’s current infrastructure to authorize direct deposit and split pay, or make automatic transfers between two accounts. Additionally, the program helps to prepare youth employees for orientation by encouraging them to bring their existing account and routing numbers with them and, if applicable, to setup an account before orientation. Learn more at AmericaSavesforYoungWorkers.org.
America Saves, a campaign managed by the nonprofit Consumer Federation of America, motivates, encourages, and supports low- to moderate-income households to save money, reduce debt, and build wealth. The research-based campaign uses the principles of behavioral economics and social marketing to change behavior. Non‐profit, government, and corporate groups participate in America Saves nationally and through local, regional, and statewide campaigns around the country. America Saves encourages individuals to take the America Saves pledge and organizations to promote savings year-round and during America Saves Week.