Financial Fitness

Counselor helping woman to achieve Financial Fitness

NeighborWorks® America, working with national partners, has developed a “Financial Fitness” program to help individuals and families develop sound money management skills. More than 85 NeighborWorks organizations participate in the financial fitness program.

Financial Fitness education has become a critical tool in successful community development, given today’s business climate of deregulated government institutions and increasingly complex financial services.

Financial education is a critical need both for consumers and for communities. For consumers, financial education is the key to building wealth — regardless of their incomes. For communities, financial education programs can help promote stronger and more stable neighborhoods—where residents are more resistant to downturns in the economy and other financial threats.

The U.S. financial system is not only complex, but also laden with institutional barriers and potential pitfalls. Over the years, access to legitimate financial institutions and credit in low-income neighborhoods has become more and more difficult. Local bank branches have been replaced by expensive fringe banking outlets, such as check-cashing stores, payday loan outlets and pawnshops. Moreover, some residents face cultural or language barriers that prevent them from fully accessing suitable financial services. Other dangers include consumer scams and schemes, as well as predatory lending practices— high-cost loans that strip away the wealth and assets families may have accumulated.

Financial education can help families become more aware of common pitfalls and thus avoid them. It can also help them to learn the financial management and planning skills needed to make the most of their income, savings and assets.

The need for broad financial education services has been recognized by many and has led to an increase in the number of organizations developing and delivering financial education. Many curricula are in circulation around the country, being used by Cooperative Extension and education organizations; government agencies; consumer, nonprofit and community organizations; as well as private financial institutions and credit agencies.