The Leveraging Mobility Series
What has driven these wealth changes?
The trends in these interviews and national survey data raise the question: What has enabled some families to build wealth while others fall behind? The interviews point to some key variables that subsequent briefs and reports in this series will explore in greater depth. In untangling the web of choices families face in creating family financial security, it is clear that extended family wealth, policy and employment structures, and knowledge about and access to reliable information, all incentivize and drive the strategies, decisions, and trade-offs that families make. The data point to the intersection of the choices and prospects that families encounter, and the need to create opportunity structures that enable families to access and leverage opportunity to build wealth and family well-being over time.
Each of the briefs will explore the policy implications of the findings in greater depth. We will complete the series with a synthesis report that pulls the series together and highlights the intertwining policy implications.
"Leveraging Mobility: Building Wealth, Security and Opportunity for Family Well-Being" looks at how families build and secure wealth. In a decade of stagnating economic mobility, and increasing income and wealth inequality, how have families built and secured a nest egg for their own retirement security and to leverage their children’s future well-being? What are the pathways and structures that helped them get on and stay on the wealth escalator? Drawing on a unique dataset of longitudinal interviews conducted twelve years apart, families with children in three major cities across the nation were asked about their assets, wealth, income, economic security and life aspirations. This first brief “Leveraging Mobility: Building Wealth, Security and Opportunity for Family Well-Being” highlights some surprising key findings, and provides information on how families in the study have fared over the first decade of the twenty-first century.
“Employment Capital: How Work Builds and Protects Family Wealth and Security,” suggests the link between employment and building wealth goes far beyond the paycheck. Drawing on the lived experiences of families, this report adds a critical new understanding of the connection between work and wealth. Interviewing young families in the late 1990s—when the economy was growing and prosperous—and again in 2010—during a stagnant economy amid dramatic wealth loss—we were surprised to find that more than two-thirds had seen their wealth increase. As we talked to them, it became clear that many factors were at play. One important observation was that for many of the families that built wealth, the characteristics of their employment facilitated a pathway to accumulating wealth that income alone could not provide. A puzzle remained, however. African-American families in our interview sample saw their incomes and educations rise in relation to those of white families, and yet their wealth increased at a significantly lower rate. Sifting through the interview data and aligning it with national data as a comparison, it became clear that wealth-building job characteristics are distributed unequally, and sorted through race, class, and occupation.
"Keeping Dreams Alive: The Lane-Changer Costs of Financial Disruptions" explores income-disrupting life events (divorce, unemployment, poor health, caregiving) that occur far more frequently than we think and the real costs and consequences and how the effect financial well-being. The report reveals that these life events can have deeper consequences that shift life’s trajectories and curtail family-member's dreams. Not everyone experiences the same risk of income-disrupting life events. Nor do all families have the same depth of resources to navigate them. The result, these life events affect families differently. This report reviews how families bear the costs of income-disrupting life events and the financial context that impacts how they make decisions to maintain immediate well-being. This report looks at ways policy can increase the capacity of families to stay on track as well as methods that policy can generate opportunities for families to overcome income-disrupting life events.
To be released in 2014:
The Private Social Safety Net: The Impact of Extended Family Wealth on Family Financial Security
The asset field challenges how economic security and well-being is measured and understood. A fuller picture emerges when we include household wealth. The interview data suggest fluid movement of wealth within kinship networks, implying we need a broader view of how surveys currently measure wealth flows. By understanding wealth flows around kinship networks in greater depth we get a more complete picture of how a family faces economic challenges and how they might be able to take advantage of opportunities for mobility. This brief will explore the myriad ways that extended family support–both direct and indirect financial support–help families maintain income, financial security, and build opportunities for the next generation.
Changing the Rules of the Game: Homeownership and Wealth
Homeownership has historically been the means to build wealth in the U.S. Our interviews confirm that the wealth built from homeownership has converted into other forms of security and well-being, allowing families to renovate their homes, send their children to college, start a business, and save for retirement. But volatile and uneven home prices and neighborhood decline has left some families with a liability rather than an asset. In the leveraging mobility data we see examples where homes continue to be a source of wealth, where homes are simply a place to live, and where homes are a liability. This brief will explore the new reality of owning a home for families in the twenty-first century and whether homeownership can still provide the same wealth benefits promised in the twentieth century.
Contact Hannah Thomas at (781) 736-3819 for more information.