Prosperity Works, for Kids

Thursday, February 26, 2015

New Mexico is known for its beauty, culture and art. It is also one of the poorest states in the country.  One organization—Prosperity Works—has taken the lead in combatting poverty in New Mexico. Prosperity Works has formed a network of organizations dedicated to helping individuals and families build assets to enable them to move from the economic margins to the mainstream, from vulnerability to security.  A few years ago, Prosperity Works’ leadership contacted AEDI to consult with them on a Child Savings Account (CSA) program. Ona Porter, Prosperity Works’ President/CEO, and Sharon Henderson, Senior Vice-President, were aware of Dr. Willie Elliott’s research and the work of AEDI, and they wanted support as they constructed the CSA, to be funded by the Kellogg Foundation.  After several phone calls throughout the summer of 2012, I took a team with me in October, 2012 to visit with Prosperity Works in person.  We shared with them the activities that we have conducted for other organizations and, in the resulting conversation, they asked if we could evaluate their planning process and help them come up with a plan to evaluate outcomes for the CSAs once they were in place.   The Kellogg Foundation had given them a year to plan the rollout of the CSAs, with the caveat that they had to hire a group unaffiliated with the network to evaluate the planning process. Thus began our relationship with Prosperity Works. 

In the planning process we evaluated:

  • Infrastructure, policies, procedures and funding required to effectively provide Children’s Savings Accounts (CSAs) to all kindergartners in the South Valley of Albuquerque
  • The design & selection of an efficient, culturally-appropriate financial education system for participant children and their families
  • Feasibility, including costs, of providing banking and incentivized savings products to the parents and grandparents of participant children
  • The systems and process that might be used to replicate the infrastructure development for CSAs throughout the state of NM

 

The planning process included representatives from organizations within the network, individuals with children who had established an individual development account (IDA) through Prosperity Works, members from the community, experts in the field, and the school district. After the planning was completed, Prosperity Kids was born.  Prosperity Works (PW) intended to have Prosperity Kids (PK) up and running by the spring of 2014. However, as in many initiatives in this still-new CSA field, they ran into many unanticipated challenges, including how best to deliver the matched CSAs, as well as how to integrate emergency savings products for parents into the child accounts, and how to build a children’s assets constituency in state leadership.

Last week AEDI’s blog talked about CSAs as two-generation approaches to combating poverty. Prosperity Kids is a perfect of example. The kids are being taught about financial literacy and banking but the parents/caregivers are involved as well.  Prosperity Kids has built opportunities for multiple generations into its design from the beginning, an essential feature in these communities, where some families have as many 3 generations in the same household.  Prosperity Kids started the CSA rollouts in Fall 2014, and our first rounds of qualitative and quantitative research are scheduled to begin this spring. Prosperity Works intends to start matched child savings accounts for 500 kids in grades 4-6 in schools throughout Albuquerque, New Mexico, with the potential to replicate successful elements of the model statewide.  At the last count they have opened 300 accounts. AEDI is grateful for our partnership with Prosperity Works, excited about their progress, and eager to learn from Prosperity Works’ experiences with two-generation savings products in New Mexico. Stay tuned for updates here, including a coming post from Prosperity Works staff about how asset-building fits into their larger economic mobility agenda, and early findings from the research in Summer 2015!

 
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