as more households rent, how can we encourage them to save?

8112019 As More Households Rent How Can We Encourage Them to Save

httpslidepdfcomreaderfullas-more-households-rent-how-can-we-encourage-them-to-save 110

1 Center for American Progress | As More Households Rent How Can We Encourage Them to Save

As More Households Rent How Can

We Encourage Them to SaveBy David Abromowitz and Sarah Edelman September 10 2014

When i comes o building wealh rening in general ends no o be a good sraegy or

saving ener households in he Unied Saes have a median ne worh991252he oal value

o wha a household owns minus wha i owes991252o abou $51001 By conras house-

holds ha own homes have a median ne worh o more han $1700002 Even reners

wih incomes comparable o heir homeowner counerpars make ewer financialinvesmens and have significanly less wealh3

In he wake o he housing crisis and subsequen recession more people are rening raher

han owing homes In many jurisdicions rening is even more expensive han owning

Ye when a homeowner remis a monhly morgage paymen o heir lender a porion o

ha paymen builds equiy in he home which belongs o he homeowner When a

rener pays monhly ren o a landlord ha money is gone or good4 Te absence o his

ldquoorced savingsrdquo o a morgage paymen is one o he reasons rening amilies have only a

small racion o he savings cushion available o mos homeowners

radiionally home equiy has accouned or a significan share o amily wealh especially

or low-income amilies and amilies o color In 2010 home equiy comprised 62 percen

o household ne worh among Arican American households and 67 percen among

Laino households5 I is imporan o ensure ha every qualified household has he

opporuniy o build asses hrough homeownership i hey choose I is also criical o

make i easier or hose who are no able or ineresed in pursuing homeownership o

accumulae savings

Especially in he ace o sagnan wages i is an ever-increasing challenge o help rener

households save6 I America is o coninue as a land o widespread economic opporuniy

i is criical o find ways o enable amilies who are rening o build asses

Indeed here are already a ew promising models o help reners accumulae savings

while hey pay heir monhly ren In his issue brie we provide inormaion abou

programs ha provide reners he opporuniy o save and build wealh offered hrough

he ederal governmen a nonprofi organizaion and a or-profi company We also




provide a review o behavioral economics undamenals o help inorm he conversaion

abou designing effecive programs o pu reners on a pah oward financial securiy

The chal lenges of building savings while renting

Te mos recen snapsho o American households shows ha he median rener householdhas virually no cash savings According o Harvardrsquos Join Cener or Housing Sudies

reners have median cash savings o $630 and he median rener ne worh including all

asses is jus $5100 For homeowners he cash savings cushion is 10 imes as large as

ha o reners991252$6400991252and median ne worh is almos 35 imes as much991252$1730107

In shor mos rener households have neiher a personal saey ne nor a way o build

asses or he uure

I is no easy o isolae he individual acors ha explain his correlaion beween rening

and relaively low savings One acor may be he high percenage o income ha mos

amilies pay or ren Hal o reners pay more han 30 percen o heir gross householdincome or heir housing which classifies hem as ldquocos-burdenedrdquo by housing coss and

represens a 12 percen increase since 20018 weny-eigh percen o reners pay more

han hal heir income oward having a place o live a roughly 8 percen increase since

20019 Arican American and Laino households ace even seeper ren burdens han he

populaion as a whole 35 percen o Arican American households and 31 percen o

Laino households spend more han hal o heir income on ren10

For many o hese households paying ren compees wih paying or oher basic needs

According o one analysis lower-income amilies in unaffordable housing unis spend

ldquoa hird less on ood hal as much on pensions and reiremen hal as much on clohesand hree-quarers less on healhcare as amilies paying affordable shares o heir incomes

or housingrdquo11

Creating savings opportunities for renters Existing models and

emerging approaches

For amilies ha ren a well-designed savings program can provide he means o buy a

home inves in a small business or send a child o college In many cases having he abiliy

o save means he difference beween being able o financially weaher a job loss an illness

or even a major car repair insead o going ino deb o cover hese ypes o unexpeced

coss12 Ulimaely having savings can make he difference beween a financial seback

being a small navigable bump in he road versus a rigger or longer-erm dependence

on governmenal social saey ne programs






A he end o he our-year sudy 24 percen o FSS paricipans graduaed 37 percen lef

he program wihou graduaing and 39 percen remained enrolled According o HUD

mos o he paricipans in he sudy who lef he program early did so because hey ldquodid

no comply wih FSS rules or los heir voucher assisance hellip [or] because amily and work

obligaions made i difficul o susain conac wih he case managerrdquo20 Adminisraive

hurdles and socioeconomic challenges such as a lack o good job opporuniies inadequae

child care and ransporaion problems are he orces ha mos requenly underminedparicipansrsquo capaciy o complee he program21

Approximaely 14 percen o public housing FSS graduaes became homeowners afer

compleing he program in 2011-201222 Alhough households ha exied he program

oreied heir righ o access he savings accumulaing in escrow hese households on

average had sill each accumulaed more han $2000 in heoreical savings23

Due in large par o unding consrains he FSS program has remained relaively modes

in size24 According o HUD daa repored by he Cener or Housing Policy o he Naional

Housing Conerence25

here ldquowere nearly 47000 housing choice voucher-holders andmore han 8700 public housing reners paricipaing in FSS as o March 2011rdquo ou o some

27 million rener households in he Unied Saes wih annual income under $50000 a

ha ime26 Neverheless he FSS program may be he larges ren-based savings program

in he Unied Saes and has more han a 20-year hisory

Overall FSS daa show a promising correlaion beween a savings mechanism linked

o ren paymen and noable increases in savings or lower-income households27

Biparisan legislaion was inroduced in 2013 o expand he FSS program by sreamlining

adminisraive uncions providing more suppor services o beter equip paricipans

o succeed in he program and allowing more amilies o paricipae Unorunaelyhe legislaion has no advanced28

Nonprofit Cornerstone Corporation for Shared Equityrsquos renter equity program

Cornersone Corporaion or Shared Equiy or CCSE a nonprofi communiy develop-

men organizaion based in Cincinnai Ohio creaed an innovaive rener equiy sysem

in 200029 As described by CCSE ldquoesidens can earn up o $4137 in five years Afer

five years residens are vesed in he Cornersone ener Equiy und and can draw on

heir equiy991252wih a maximum o $10000 being paid over 10 yearsrdquo30

eners who ener a rener equiy conrac earn wha is ermed ldquoequiy credirdquo each ime

hey ulfill one o he specified rener obligaions31 Afer five years reners can cash in

heir credis or any purpose Tey have he flexibiliy o use heir savings as hey choose

and can borrow agains he earned credis even beore he accoun is ully vesed CCSE

allows paricipans o borrow up o one monhrsquos ren a 0 percen ineres in heir firs




year which mus be paid back over 12 monhs Tey can borrow progressively more he

longer hey paricipae up o a cap o 80 percen afer five years

CCSE acs as he owner and developer o he renal housing991252offering hird-pary manage-

men as well991252and he rener equiy sysem is unded by managemen and developmen

ees as well as oundaion suppor Te rener equiy parnership has conribued o high

occupancy raes wih an average o 96 percen32 hereby cuting down on urnover cossor CCSE Cornersonersquos propery-managemen coss even afer considering he cos

o he rener equiy credis are on par wih similar Low-Income Housing ax Credi

properies in he communiy33

In a recen independen sudy he Corporaion or Enerprise Developmen a

nonprofi helping moderae- and low-income amilies build asses ound boh social

and financial benefis associaed wih he rener equiy program Te sudy concludes

ldquoCornersone reners are earning equiy and ha paricipaion in he propery manage-

men sysem appears o have had a posiive impac on renersrsquo lives in erms o heir

physical and financial securiy heir opimism abou he uure and heir ies wih hesurrounding communiyrdquo34

Te Cornersone rener equiy sysem so ar has remained small serving 51 reners in

201235 Cornersonersquos unique approach offers reners he opporuniy o build equiy

live in affordable renal unis wih high-qualiy propery managemen and help make

decisions abou building managemen Such an approach requires a well-rained and

highly dedicaed saff Wih hopes o bringing his unique model o scale Margery Spinney

he ounder o CCSE recenly esablished an organizaion called ening Parnerships

o provide reners developers and propery managers wih he ools and suppor hey

need o effecively develop adminiser and susain a rener equiy exchange model36

For-profit Waypointrsquos earning credit for paying rent

Waypoin Homes or simply Waypoin is a privae real esae company acive in buying

and rehabiliaing disressed single-amily homes many ormerly oreclosed and offering

hem or ren37 Waypoin promoes wha i calls a Lease Plus ewards program Tis

program gives reners he chance o earn so-called ldquoWaypoinsrdquo or paying ren on ime

keeping he uni well mainained renewing heir lease and aking a financial lieracy class38

Tey can hen redeem hese poins or cash back Te program is open o Waypoin

reners who have signed wo-year leases wih Waypoin which currenly represens

abou hal o Waypoinrsquos residens

Waypoinrsquos adopion o such a program suggess ha or-profi landlords can realize

posiive economic benefis rom a program ha links ren paymens o savings Under

he Waypoin program he rener is no required o make any addiional conribuion




beyond paying ull ren on ime Waypoin may have paricular moivaions o offer such

a program due o is business ocus on scatered-sie single-amily renals For example

requiring paricipans o sign a lease or 24 monhs raher han he ypical 12 monhs

Waypoin may be able o realize subsanial coss savings hrough reducing vacancy periods

Waypoin also may benefi rom branding heir approach as ldquoreinvening reningrdquo which

may help atrac boh reners and invesors39

Designing an effective renter savings programs

Over he pas 20 years researchers in behavioral economics have explored in grea deail

he moivaions or and obsacles o saving by consumers While researchers do no

agree on a single lis o characerisics ha savers share his body o lieraure highlighs

acors ha influence wheher puting aside money is more or less likely o occur Tese

characerisics include uure orienaion ineria inormaion access o insiuional

opporuniies and sufficien financial resources In paricular consumers are more likely

o save991252and o save more991252when hey have access o a srucured savings plan ha iseasy o undersand and where deposis occur auomaically

While a ull review o he behavioral economics lieraure is beyond he scope o his

issue brie a ew key poins are useul in considering he design o an effecive savings

srucure or reners

Make saving automatic

Curren savings behavior ends o require he abiliy o visualize and plan or he uure

along wih he willpower o sick o a savings program Even or hose wih such skills

exigencies o daily lie and circumsances ofen preven or disrup savings paricularlyor households where income barely covers basic living expenses

However researchers show ha he experience o saring a savings plan and accumulaing

even modes asses can help individuals change heir behaviors or ways o hinking40 As

hey save hey become more confiden abou he uure and develop a greaer commimen

o savings

Savings pracices may also be shaped by a degree o ldquoineriardquo in our behavior991252ha is

o say once a choice is made i requires a moivaion o make a change 41 For example

in one classic sudy he universiy reiremen plan IAA-CEF ound ha when

employees were auomaically enrolled in a savings plan and had o ldquoop-ourdquo o sop saving

paricipaion raes o new employees increased rom 49 percen o 86 percen42

Matched-savings programs can make saving more productive

No surprisingly research shows ha when here are angible shor-erm financial rewards

or saving saving becomes more atracive o consumers43 Mached-savings programs




offered hrough employers local governmens and nonprofis or example have grown

in populariy over he pas decade and some programs have had sellar resuls Mached-

savings programs ypically combine moneary savings incenives and financial educaion

o help households se and mee savings goals While no comprehensive sudy exiss o

show he naionwide ooprin o mached-savings programs millions o Americans o

all income levels already benefi rom maching programs44

Consumers are more likely to use easy-to-use programs

In a sudy o a program operaed by he mega ax preparaion firm Hamp Block ha

offers maches o individual reiremen accoun or IR conribuions o ax filers

researchers ound ha a user-riendly and easy-o-undersand program is more likely o

resonae wih consumers45 In ha sudy consumers chose he IR-maching program

a ar greaer raes han he Saverrsquos Credi991252a ax credi or low- and moderae-income

axpayers who make reiremen conribuions o an IR 401(k) or any oher govern-

men-recognized reiremen accoun991252even hough he Saverrsquos Credi offered a more

generous financial incenive because he mach was available o virually all ax filers

and was simpler46

Te sudy poins o he value o clear messaging and he imporanceo having a proessional walk he consumer hrough he program Te Cornersone

program described in he previous secion also shows he benefi o coninually engaging

wih paricipans o encourage savings

Consumers may save more when they experience shor t-term rewards for saving

esearchers a he Universiy o Norh Carolina a Chapel Hill Cener or Communiy

Capial sudied paricipaion raes in he $aveNYC program a mached-savings program

offered o low-income New Yorkers and deermined rewarding behavior sooner raher

han laer may help increase paricipaion According o he sudy $aveNYC was highly

effecive abou 70 percen o paricipans successully compleed he one-year programin 2010 wih average savings conribuion o $70047 Te researchers ound ha as

paricipans neared he one-year compleion dae heir risk or wihdrawing rom he

program decreased48 Tey said he finding suggess ha paricipans are more likely o

say in he program when heir goal is in sigh and hereore migh be more likely o say

in he program longer i here are opporuniies or shorer-erm savingsrsquo goals

Te our insighs described above srongly sugges ha i is worh exploring he easibiliy

o a program in which landlords mach a deposi ino savings made by a rener as par o

an auomaic monhly ren paymen Bu wha would provide an incenive or landlords

o make a maching paymen For some i migh be enough ha such a program require

he rener o make his auomaic paymen as ha will enable he landlord o receive he

ren on ime and elecronically Or i he rener were allowed o access he accoun or

shor-erm emergencies i could help decrease he likelihood o ailure o pay ren I is

also possible ha he governmen a he local sae or ederal level could provide ax

incenives o he landlord or even provide he savings mach




Key o any effecive program would be assurances ha landlords will no raise he monhly

ren in order o cover he cos o he savings conribuion Addiionally srong consumer

proecions would have o be in place o ensure ha he new savings iniiaives are sae

and reliable or consumers Oher quesions ha arise include wheher o make such a

program available only o reners below a cerain income level and wheher some ype

o special savings accoun would need o be creaed I here were o be a ederal or sae

mach here is he quesion o wheher he program could work wih exising savingsprograms such as individual developmen accouns or IDAs or he ederal Saverrsquos Credi

or wheher new savings vehicles would be needed

Conclusion

As more amilies ren raher han own homes i is criical o ramp up he policy discussion

abou how o make i easier or reners o build wealh Tere are promising rener savings

programs underway ha deserve greaer atenion and urher developmen rom Congress

agencies saes and localiies and landlords hemselves o be effecive a rener savingsprogram should employ as many as possible o he eaures ha end o increase savings

including an auomaic conribuion simple design maching or oher financial incenives

and ongoing suppor or paricipans

More research is needed o undersand he long-erm economic benefi o exising

programs Moreover addiional research is needed o deermine wheher and how o

bring rener savings programs o scale A small mached-savings pilo among reners

living in buildings managed by or-profi landlords migh be one way o help us beter

undersand he benefis o his approach991252including he propery-managemen cos

savings such a program migh yield991252and he challenges

Creaing a sysem o boos savings among reners is an essenial par o creaing a sable

and financially secure middle class Te good news is ha some work is already underway

o provide low- and middle-income amilies wih savings ools I our naion is o make

any headway in he widening gap beween rich and poor communiies and policymakers

mus redouble hese effors

David M Abromowitz is a Senior Fellow at the Center for American Progress Sarah Edelman is

a Policy Analyst on the Housing Finance and Policy team at the Center




Endnotes

1 Joint Center for Housing Studies ldquoThe State of the NationrsquosHousing 2013 Appendixesrdquo (2013) Table A-6 available athttpwwwjchsharvardedusitesjchsharvardedufilesson2013_chap7_appendix_tablespdf

2 Ibid

3 Joint Center for Housing Studies ldquoAmericarsquos Rental HousingEvolving Markets and Needsrdquo (2013) available at httpwwwjchsharvardedusitesjchsharvardedufilesjchs_americas_rental_housing_2013_1_0pdf

4 Ibid

5 Joint Center for Housing Studies ldquoThe State of the NationrsquosHousing 2013rdquo (2013) Table A-6 available at httpwww jchsharvardedusitesjchsharvardedufilesson2013pdf

6 David Abromowitz ldquoThe Housing Market Is Not Only ForHomeownersrdquo (Washington Center for American Progress2012) available at httpwwwamericanprogressorgwp-contentuploads201212AbromowitzRentalBriefpdf

7 Joint Center for Housing Studies ldquoThe State of the NationrsquosHousing 2013 Appendixesrdquo

8 Joint Center for Housing Studies ldquoThe State of the Nationrsquos

Housing 2013 Housing Chall engesrdquo (2013) p 28

9 Joint Center for Housing Studies ldquoAmericarsquos Rental HousingEvolving Markets and Needsrdquo (2013) Table A-6

10 Ibid

11 Joint Center for Housing Studies ldquoThe State of the NationrsquosHousing 2013 Hou sing Challengesrdquo p 6

12 Clinton C Key and others ldquoSavings at Tax Time The Effect of$aveNYC on Savings in Low-income Householdsrdquo WorkingPaper (UNC Center for Community Capital 2013) p 34available at httpcccunceducontentitemssavings-at-tax-time-the-effect-of-avenyc-on-savings-in-low-income-households

13 Lisa Mensah and others ldquoSavings for Life A Pathway toFinancial Security for All Americansrdquo (New York Initiative onFinancial Security Aspen Institute 2007) available at httpwwwaspeninstituteorgsitesdefaultfilescontentdocsifs

Savings_for_Lifepdf

14 Joe Valenti and Christian Weller ldquoCreating EconomicSecurity Using Progressive Savings Matches to CounterUpside-Down Tax Incentivesrdquo (Washington Center forAmerican Progress 2013)

15 While there are many flaws in the overall argument foreliminating the FHA the AEI proposal did acknowledge thatsaving enough for even a 10 percent down payment of amodestly priced home would take a decade or moremdashassuming a reasonable savings rate and no financialsetbacksmdashwithout a government savings matching programand assuming no major financial setbacks during that entireperiod Joseph Gyourko ldquoRethinking the FHArdquo (WashingtonAmerican Enterprise Institute 2013) pp 5ndash7 available athttpwwwaeiorgfiles20130619-rethinking-the-fha_142030868406pdf

16 Joshua Rosner ldquoHow to Turn Homes Back Into Piggy Banksrdquo

Bloomberg View May 22 2014 available at httpwwwbloombergviewcomarticles2014-05-22how-to-turn-homes-back-into-piggy-banks

17 Cranston-Gonzalez National Affordable Housing Act S 556101 Cong (1990) available at httpswwwgovtrackuscongressbills101s566text

18 Hannah Emple ldquoAsset-Oriented Rental Assistance NextGeneration Reforms for HUDrsquos Family Self-Sufficiency Programrdquo(Washington New America Foundation 2013) p 8

19 Planmatics Inc and Abt Associates Inc ldquoEvaluation of theFamily Self-Sufficiency Program Prospective Studyrdquo (USDepartment of Housing and Urban Development Office of

Policy Development and Research 2011)

20 Ibid p ix

21 Emple ldquo Asset-Oriented Rental Assistancerdquo p 16

22 Fourteen percent of graduates became homeownersldquoduring the period of A pril 1 2011-March 30 2012rdquo See USDepartment of Housing and Urban Development ldquoFY 2014Congressional Justificationsrdquo (2013) H-2 available at httpportalhudgovhudportaldocumentshuddocid=FAMSELFSUFFPROGpdf

23 Planmatics Inc and Abt Associates Inc ldquoEvaluation of theFamily Self-Sufficiency Programrdquo Table 36

24 Emple ldquo Asset-Oriented Rental Assistancerdquo

25 Maya Brennan and Jeffrey Lubell ldquoMore Than a Roof CaseStudies of Public Housing Agency Initiatives to Increase

Rentersrsquo Economic Securityrdquo (Washington Center for HousingPolicy 2012) p 4 available at httpwwwnhcorgmediafilesIdeasBrief_AssetBdg_finalpdf

26 Joint Center on Housing Studies ldquoAmericarsquos Rental HousingEvolving Markets and Needsrdquo Table A-6

27 For more analysis of FSS program see Emple ldquoAsset-OrientedRental Assistancerdquo

28 Sen Jack Reed ldquoReed amp Blunt Introduce the Family Self-Sufficiency Actionrdquo Press release March 6 2013 available athttpwwwreedsenategovnewsreleasereed-and-blunt-introduce-the-family-self-sufficiency-act

29 Federal Reserve Bank of St Louis ldquoInnovation The 10000-Hour Challengerdquo available at httpwwwstlouisfedorgcommunity_development10000hourchallengepastfeaturedcfm (last accessed August 2014)

30 Cornerstone Corporation for Shared Equity ldquoAboutrdquo

available at httpcornerstone-equityorgabout

31 Federal Reserve Bank of St Louis ldquoInnovation The 10000-Hour Challengerdquo

32 Margery Spinney ldquoExpanding Economic Opportunity throughRenter Equityrdquo Renting Partnerships On file

33 Anita Drever ldquoCornerstonersquos Renter Equity PropertyManagement System Final Evaluation Repor trdquo (WashingtonCorporation for Enterprise Development 2013) p 8 availableat httpwwwohiohomeorgresearchdocumentsCornerstoneEvaluation-FinalReportpdf

34 Ibid

35 Ibid p 25

36 Margery Spinney interview with author November 2012For more information see Renting Partnerships ldquoAboutrdquo

available at httpwwwrentingpartnershipsorgabouthtml (last accessed August 2014)

37 Most homes are purchased through Starwood WaypointResidential Trust or SWAY

38 Waypoint Homes ldquoLease Plus Rewardsrdquo available at httpwwwwaypointhomescomlease_plus_rewardslang=en (last accessed August 2014)




39 Julian Hebron ldquoWhy Waypoint Homes is DominatingRent-To-Own Home Marketrdquo The Base Point November 152012 available at httpthebasispointcom20121115why-waypoint-homes-is-dominating-rent-to-own-home-market Notably Starwood Property Trust has announcedplans to acquire Waypointrsquos management group and spinthe single-family rental business off into a publicly tradedreal estate investment trust or REIT John GittelsohnldquoStarwood to Spin Off Home-Rental Division Into New REITrdquoBloomberg News October 31 2013 available at httpwwwbloombergcomnews2013-10-31starwood-said-to-plan-reit-ipo-buy-waypoint-managementhtml

40 See description of Michael Sherraden ldquoAssets and the Poorrdquo(ME Sharpe Inc 1991) in Kim Maturuk Jessica Dorranceand Sarah Riley ldquoFactors affecting completion of a matchedsavings program Impacts of time preference discount rateand financial hardshiprdquo Journal of Socio-Economics 41(2012) 836-842

41 Richard Thaler and Shlomo Benartzi ldquoSave More TomorrowUsing Behavioral Economics to Increase Employee Savingrdquo

Journal of Political Economy 112 (1) (2004) pt 2

42 Brigitte Madrian and Dennis Shea ldquoThe Power of SuggestionInertia in 401(k) Participation and Savings Behaviorrdquo TheQuarterly Journal of Economics 116 (4) (2001) 1149-1525available at httpwwwretirementmadesimplerorgLibraryThe20Power20of20Suggestion-20Inertia20in2040128k29pdf

43 Valenti and Weller ldquoCreating Economic Securityrdquo

44 Ibid

45 Ibid

46 Ester Duflo and others ldquoSaving incentives for low- andmiddle-income families evidence from a field experimentfrom HampR Blockrdquo The Quarterly Journal of Economics 121(2006) available at httpelsaberkeleyedu~saezduflo-gale-liebman-orszag-saezQJE06block_smallpdf

47 UNC Center for Community Capital ldquoThe Importance of Tax

Time for Building Emergency Savings Major Findings from$ave NYCrdquo (2013) available at httpcccsitesuncedufiles201305SaveNYCpdf

48 Kim Manturuk Jessica Dorrance and Sarah Riley ldquoFactorsaffecting completion of a matched savings program Impactof time preference discou nt rate and financial hardshiprdquo(Chapel Hill NC UNC Center for Community Capital 2012)available at httpwwwcccuncedudocumentsMatchedSavingsProg40912pdf




provide a review o behavioral economics undamenals o help inorm he conversaion

abou designing effecive programs o pu reners on a pah oward financial securiy

The chal lenges of building savings while renting

Te mos recen snapsho o American households shows ha he median rener householdhas virually no cash savings According o Harvardrsquos Join Cener or Housing Sudies

reners have median cash savings o $630 and he median rener ne worh including all

asses is jus $5100 For homeowners he cash savings cushion is 10 imes as large as

ha o reners991252$6400991252and median ne worh is almos 35 imes as much991252$1730107

In shor mos rener households have neiher a personal saey ne nor a way o build

asses or he uure

I is no easy o isolae he individual acors ha explain his correlaion beween rening

and relaively low savings One acor may be he high percenage o income ha mos

amilies pay or ren Hal o reners pay more han 30 percen o heir gross householdincome or heir housing which classifies hem as ldquocos-burdenedrdquo by housing coss and

represens a 12 percen increase since 20018 weny-eigh percen o reners pay more

han hal heir income oward having a place o live a roughly 8 percen increase since

20019 Arican American and Laino households ace even seeper ren burdens han he

populaion as a whole 35 percen o Arican American households and 31 percen o

Laino households spend more han hal o heir income on ren10

For many o hese households paying ren compees wih paying or oher basic needs

According o one analysis lower-income amilies in unaffordable housing unis spend

ldquoa hird less on ood hal as much on pensions and reiremen hal as much on clohesand hree-quarers less on healhcare as amilies paying affordable shares o heir incomes

or housingrdquo11

Creating savings opportunities for renters Existing models and

emerging approaches

For amilies ha ren a well-designed savings program can provide he means o buy a

home inves in a small business or send a child o college In many cases having he abiliy

o save means he difference beween being able o financially weaher a job loss an illness

or even a major car repair insead o going ino deb o cover hese ypes o unexpeced

coss12 Ulimaely having savings can make he difference beween a financial seback

being a small navigable bump in he road versus a rigger or longer-erm dependence

on governmenal social saey ne programs



















Housing Conerence25













































































srucure or reners








o savings



























and was simpler46


































Conclusion























Endnotes


2 Ibid


4 Ibid







10 Ibid




Savings_for_Lifepdf









20 Ibid p ix
















34 Ibid

35 Ibid p 25














44 Ibid

45 Ibid























Housing Conerence25













































































srucure or reners








o savings



























and was simpler46


































Conclusion























Endnotes


2 Ibid


4 Ibid







10 Ibid




Savings_for_Lifepdf









20 Ibid p ix
















34 Ibid

35 Ibid p 25














44 Ibid

45 Ibid





























































srucure or reners








o savings



























and was simpler46


































Conclusion























Endnotes


2 Ibid


4 Ibid







10 Ibid




Savings_for_Lifepdf









20 Ibid p ix
















34 Ibid

35 Ibid p 25














44 Ibid

45 Ibid























and was simpler46


































Conclusion























Endnotes


2 Ibid


4 Ibid







10 Ibid




Savings_for_Lifepdf









20 Ibid p ix
















34 Ibid

35 Ibid p 25














44 Ibid

45 Ibid
















Conclusion























Endnotes


2 Ibid


4 Ibid







10 Ibid




Savings_for_Lifepdf









20 Ibid p ix
















34 Ibid

35 Ibid p 25














44 Ibid

45 Ibid








Endnotes


2 Ibid


4 Ibid







10 Ibid




Savings_for_Lifepdf









20 Ibid p ix
















34 Ibid

35 Ibid p 25














44 Ibid

45 Ibid














44 Ibid

45 Ibid





as more households rent, how can we encourage them to save?

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