Why is asset building important to people with disabilities?

For the past 17 years, the federal government has passed laws and created programs to encourage people with disabilities to become more independent, reduce reliance on the government, manage public resources through individual budgets to direct and control support needs, and advance community participation. As current financial literacy initiatives move forward for modest income families, people with disabilities are noticeably absent when it comes to outreach and promotion. The missing link is a coordinated national effort that connects people with disabilities to existing financial service and programs that will support them, leading to increased independence.

Research shows that having financial independence and asset building is linked to good health and quality of life. Homeownership, education beyond high school, savings and investments all lead to good jobs and increased longevity. But a child born today in the United States with a significant disability still has little chance of gaining economic self-sufficiency despite advances in health care, assistive technology, education, independent living and employment without access to mainstream financial services and without access to mainstream financial services, and local, state and federal programs that offer support. Children with disabilities living in poverty will move into healthy financial futures only if asset-building and financial literacy strategies are made available.

Poverty continues to play a major role in the lives of people with disabilities. Thirty-eight (38%) percent of working-age adults with disabilities live in households with annual incomes of under $15,000, and 30 percent do not have either checking or savings accounts. People with disabilities who are just entering the labor force often have little experience with filing taxes or managing a budget, and are unaware of existing tax credits and provisions that may positively impact their financial status. A 2004 national study found that 83 percent of people with disabilities never claimed available tax credits and/or deductions related to work and that less than half of people with disabilities who own homes claim the home mortgage interest deductions. In addition, the study found that 54 percent of people with disabilities had no savings accounts, 69 percent had no checking accounts, and 75 percent did not have loans with financial institutions.

Many families with adult children with disabilities living at home do not understand that they may qualify for the earned income tax credit, and that low-income single people with a disability may also be eligible for the EITC.

Of the dozens of financial education programs nationwide, none are designed for people with disabilities. The REI Tour creates teaching environments and curriculum accessible for people with physical, cognitive, or sensory disabilities ensuring that all people have equal access to existing financial services and supports.

Copyright 2008. NDI Inc.