EARN (Earned Assets Resource Network, Inc.)
Thousands of nonprofits serve the poor, but most do not offer a path that leads permanently out of poverty. EARN was founded to answer one basic question: how can we empower people to escape poverty forever?
EARN's answer is asset building - a new poverty-fighting strategy that empowers working-poor people with the same tools higher income people use to create financial stability. These tools include money management training, access to financial services, and a 401k-like matched account, called an Individual Development Account, or IDA. Funds in these accounts must be invested 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.
Innovation in action
EARN is a recognized national and international leader and innovator in the fight against poverty using asset-building tools. Among the more than 500 organizations which offer matched savings accounts in the US, EARN is the only one focused exclusively on reaching scale through an inventive approach to both practice and policy development. This combination of creativity and profound effectiveness was recognized when EARN was chosen as one of the ten finalists in the inaugural Amazon.com Non Profit Innovation Award in 2005.
On a grand scale, EARN's greatest notional innovation is growing the economic pie for all Americans with a focus on asset building and wealth creation - not just redistributing finite resources. Specifically, EARN leads innovation in the asset-building field in three ways:
- Relentlessly exploring new ways to increase efficiency and effectiveness in the delivery of our products and services,
- Working with financial institutions to create win-win, asset-building products and services that banks can eventually offer to working poor consumers in the way they offer IRAs to middle class customers,
- Educating policy makers on the power of asset building to create thriving economies where everyone can have a stake in their dreams and the dreams of their community.
In its four years of existence, EARN has built one of the largest IDA initiatives in the nation, opening over 900 IDAs. EARN Savers are putting aside an average of $75 per month, which is triple the national average for IDAs. EARN's attrition rate is under 10%, which is less than half the national average for IDA programs. The first 95 families to complete EARN's savings program leveraged over $6 million in home mortgages, small business capital and financial assistance for post secondary education, with an investment of just over $300,000. But the numbers only tell half of the story. EARN Savers tell the rest.
Chai, a father of two, purchased a truck for his house cleaning business, allowing him to serve many more clients and dramatically increase his income. Carmen, who had been a teenage parent, now plans on getting her MBA. Cesilia, who worked as a low-paid farm worker and a cleaning lady, bought a three-bedroom house where she, her daughter and her mother now live. Demonstrating tremendous real-world success, EARN is blazing new trails for addressing poverty on a large scale.