Program brings financial planning to Chicago working families

The program aims to infuse social service programs with information about long-term financial and career goals.

Generational wealth has to start somewhere.

Why not design long-term financial goals into social service programs that assist families who are in financial crisis or have low incomes?

A new program in Chicago aims to find out. The program, supported by a $2.2 million grant from JPMorgan Chase and implemented by the Family Hub of Chicago Commons, provides immediate help in the context of long-term financial and career goals.

Infusing intervention with the wealth-building perspective of the financial advisory profession establishes expectations for financial stability, said Vikki Rompala, vice president of the Family Hub of Chicago Commons. She leads an alliance of Chicago nonprofits that will bring the program to families across the city.

When life insurance, retirement savings accounts and property ownership are the exception rather than the rule among family and friends, struggling families can’t turn to those trusted relationships for financial guidance. And in the absence of that guidance, families — especially the working parents that the agency concentrates on — often get caught in a cycle of reacting to financial crises, Rompala said, and aren’t sure how to envision long-term financial goals, never mind identify first steps.

The focus on sustainable financial advancement fits with JPMorgan Chase’s philanthropic priorities, said Joanna Trotter, executive director and senior program officer of the bank’s global philanthropy.

“We want to lift barriers for people of color, for wealth-building,” she said, noting that the Chicago Commons project is part of the bank’s $150 million, five-year commitment to the Chicago area.

The racial wealth gap is well-established. For instance, the homeownership rate among Black Americans is 44.9%, according to the latest data compiled by the St. Louis Federal Reserve Bank, which compares to a rate of 48.5% for Hispanic Americans and 74.5% for white Americans.

It will take a purposeful effort to reset the cycle from self-defeating to self-achieving. The program focuses on two generations at a time by helping working parents stabilize their careers and immediate financial situations, often in conjunction with childcare and mental health interventions. Then working parents can explore career growth even as they make progress with improving their credit scores, building emergency savings and pursuing professional skills development.

“Having a wealth-building lens includes financial coaching, which we haven’t done at scale,” Trotter said. “It includes career pathways, which includes getting some parents directly into wealth-building jobs, and some on the trajectory to wealth-building jobs.” Such jobs include nursing, manufacturing and in some cases, entry-level positions at Chase banks.

One element of the integrated career and wealth-building coaching, Rompala said, is to equip working parents with the information and language to better advocate for themselves at work. Often they aren’t aware of, or sure how to, make the most of workplace benefits, college scholarships and other forms of aid intended to solidify their financial security.

She detects a shift toward more inclusive benefits. That trend is verified by a new Transamerica report that predicts that by 2026, more than 40% of employers will offer tools that speed employee’s saving for emergencies and 50% will offer student loan repayment programs, while retirement plans will be just as available to employees at small organizations as at large ones.

“Many families have had little experience with saving, so wealth-building feels out of reach,” Rompala said. “A step-by-step process builds their capacity and helps remove, as they move from an action plan for their careers to using the financial coaching services to build savings.”