A new report from the Pew Charitable Trusts found that despite the economic recovery, most American households continue to be financially vulnerable.

According to the report, almost half of households are income-constrained, reporting that they spent as much as or more than they made in the past year. Wages have barely budged in recent years, while the costs of housing, health care, and other necessities have increased. This strains the budget of American families, particularly families with a low income.

While overall wealth has grown, that wealth has not been equally shared. Families with the lowest incomes have not seen their wealth increase in recent years. 55% of American households are savings-limited, meaning that they have less than one month of their income in cash, checking, and savings accounts. Additionally, 8% of American households are debt-challenged, spending 41% or more of their monthly income to repay debt.

The result: most American households are still facing a financial challenge and are not prepared for a financial emergency, despite years of overall economic recovery. Both state and federal government need to be passing and implementing policies that promote asset building and financial security among low- and middle-income families.

IABG continues to work with our partners to promote policies that protect and support families as they try to balance their budgets following a devastating recession. Last year, IABG worked with partners to create wage protections for workers paid via a payroll card and to pass the Secure Choice Savings Program, expanding access to employment-based retirement savings programs.

Take Action

IABG is working with partners to pass legislation that will provide greater protections for Illinoisans in the debt collection process. SB1248 / HB2584 enables families to responsibly pay down their debt while ensure that creditors do not take so much of their wages and emergency savings that they are unable to meet their basic needs. The legislation:

• Protects a larger percentage of a worker’s wages from garnishment
• Protects a portion of a family’s savings
• Exempts college savings accounts
• Prohibits wage assignments
• Ensures all exemption amounts are tied to inflation
• Decreases interest rates facing consumers

Click here to add your organization’s support to the bill. We hope you will join us as we work for a future in which all Illinois families have the opportunity to build financial secure futures.