Getting ahead in an increasingly tough economy depends on much more than having an income. While many families and individuals are able to maintain steady employment, the grip of poverty is often one paycheck, one illness or one health condition away.
Through strategic grantmaking, the Levi Strauss Foundation (LSF) seeks to increase economic and education opportunities that support financial independence for disadvantaged women and youth.
That is why LSF funds the Earned Assets Resource Network or EARN -- a unique San Francisco organization that employs an anti-poverty strategy known as “asset building” to help working poor families achieve financial stability. The foundation has been funding EARN since 2000.
EARN works with the federal government and private donors to provide working-poor individuals and families with the same tools higher-income people use to create financial stability — money management training, access to financial services and a 401(k)-like savings account.
The savings account is where EARN clients begin to build assets. The clients’ savings are matched two-to-one. They can invest their account savings in a home, a small-business or higher education — investments that have been proven to lift people out of poverty for the rest of their lives. Every private donation EARN receives goes directly into a client’s savings account.
“As a corporate funder, a portion of our grant money goes to help triple the savers’ funds,” said Merle Lawrence, Senior Manager, Levi Strauss Foundation. “They put in a dollar, we put in a dollar and the federal government puts in a dollar. Pretty soon EARN clients are poised to make important investments that can help lift them out of poverty forever.”
The average EARN family has an annual income of $17,776. Saving about $75 or more a month can be difficult for them, but that investment helps them reach goals that once may have seemed unattainable. Nearly 60 families have already invested more than $175,000 in assets. Fifteen of those families have been able to purchase homes in the past two years.
The combination of business smarts and big-vision thinking has earned the organization national attention. Fast Company magazine named EARN one of their Social Capitalists of the Year in 2004 and BusinessWeek, CBS MarketWatch, and NPR’s Morning Edition have profiled the San Francisco nonprofit.
“Helping people to increase their assets is important because assets provide families and individuals with choices that poor people usually lack -- choices about housing, education, entrepreneurship and job training,” Merle said. “Assets enable families to plan for the future, to weather tough times, and to share their prosperity with future generations.”
EARN’s clients are living proof that assets can be leveraged to create opportunities and long-term economic stability. A father of two, purchased a truck for his house cleaning business, allowing him to serve many more clients and dramatically increase his income; a teenage parent who grew up in public housing is working toward her MBA; and a woman who works as a cleaning lady was able to buy a three-bedroom house where she, her daughter and her mother now live.
EARN has opened nearly 800 matched savings accounts for low-income San Francisco families and individuals, making it the fastest growing organization of its kind in the U.S. And for every EARN client currently being served, there is another potential client on the waiting list, anxious to get into the program.
“We owe a large part of our success to funders like the Levi Strauss Foundation, our first corporate foundation sponsor,” said Ben Mangan, President and CEO of EARN. “When our donors are willing to take risks and go beyond simply addressing symptoms – that’s when we are able to create systemic change in the fight against poverty.”
To learn more about this innovative organization, visit EARN’s Web site at www.sfearn.org
| EARN Numbers* |
| People saving in EARN accounts |
800 |
| Average household income of EARN savers |
$17,776 |
| Average monthly savings rate |
5% (or $75 / mo.) |
| Personal savings with matching funds |
$1.7 million |
| Amount already invested in homes, education and businesses |
$375,000 |
| Amount leveraged in mortgages, small business loans and educational loans |
$4.7 million |
* Figures accurate as of August, 2005.