A think tank that works on creating economic opportunity came out with its annual scorecard, a state-by-state comparison of household financial security. According to the nonpartisan, Washington-based Corporation for Enterprise Development, Illinois ranks 33 out of the 50 states on how secure families are in their finances.
The report analyzes five areas–financial assets and income, business and jobs, housing and homeownership, health care and education–and looks at how state policies are influencing those measures. Our state got a “C” in every category but housing and homeownership, where we got a “D.”
One set of data points from the report caught my eye–three different measures of poverty in our state. The first is just the regular poverty rate–13.6 percent. The second is “asset poverty,” or what percentage of families would be able to get by for three months if they lost their incomes. The third is “liquid asset poverty,” further refining the idea of asset poverty. A family of four, the report says, would need about $5,763 to get by for three months. A family may technically have that in assets, like the value of a home or car, for instance. But liquid assets are those they can get to quickly–savings, mutual funds, investments, 401Ks, etc. Liquid asset poverty means those families who don’t have enough set aside to get by for three months in a way that can be easily cashed in.
So, how are we doing on these last two measures? Take a look at this graphic: More than a quarter of Illinois families, or 26.4 percent, are “asset poor.” What’s more, 42 percent of us are “liquid asset poor.” The report on Illinois also breaks down the numbers by race. Families of color are nearly three times as likely to be asset poor, and over two times as likely to be liquid asset poor. The scorecard highlights many policies the Corporation for Enterprise Development says need to change to help families build assets. For instance, like programs that create incentives for poor families to save, more protection from pay-day lenders and a change in the income tax structure. The bottom 20 percent of families, the think tank says, pay 2.8 times more of their income in taxes than the top 1 percent.
Gov. Pat Quinn’s press office did not provide a formal response to the report card, but did point to recent legislation passed, like the bill streamlining the foreclosure process, as well as efforts to increase the minimum wage and new federal funding for health care and education, to show how Quinn is addressing the issues raised in the report.
What about you? Do you have $5,763 or likewise at the ready in case of financial collapse? Tell us your thoughts on how families can cushion themselves from job loss or debt and what the state’s role in that should be. You can leave us a comment here or find us on Facebook or twitter.