Building Stronger Financial Futures

Anne Roder
January 2015

Building Stronger Financial Futures provides interim findings from Mobility’s evaluation of five Financial Opportunity Centers supported by the Local Initiatives Support Corporation in Chicago. The report describes the FOC participants and programs and assesses the organizations’ ability to engage low-income job seekers in integrated employment, financial, and income support services and to improve individuals’ credit use and credit scores in the first year after program enrollment. We found that:

  • Most participants had limited recent work experience, and nearly all did not have enough savings to cover basic living expenses for three months. Nearly half (46%) did not have enough recent credit activity to have a credit score while 38 percent had subprime credit scores.
  • Engaging individuals who are seeking employment in integrated services is challenging. Forty-five percent of FOC participants received both employment and financial counseling while 30 percent received counseling in all three core service areas. Low-income individuals seeking employment may not think they can benefit from financial or income support counseling. The programs that required counseling engaged higher percentages of participants in integrated services.
  • During the first year after program entry, FOC participants made more on-time payments on trade accounts and were more likely than comparison group members to have paid any trade accounts on time. However, the program did not have a significant impact on increasing participants’ credit scores or helping those who were unscored become scored. Improving credit scores or becoming scored may take more than a year for unemployed or financially distressed individuals.

Our findings suggest that FOCs can help low-income individuals take steps toward improving their credit histories, which could lead to better credit scores and other improvements in financial outcomes in the future. Our final report on the evaluation will examine whether the FOC program helped participants obtain jobs, increase their net income, access mainstream forms of credit, and build their net worth two years after program entry.

Read the report