Press Releases

Remarks of Assistant Secretary Amir-Mokri at a Public Meeting of the FLEC

(Archived Content)




WASHINGTON - Welcome to Treasury.  I am pleased to have you all with us this morning as we explore how the federal government can partner with state and local governments to advance the financial capability of our nation’s young people.  Today we will talk about the strengths and opportunities each level of government can offer toward achieving the goals of helping young Americans better navigate financial decisions and achieve financial security. 


I don’t need to remind you of the importance of this cause.  The economic changes in the last few decades have brought us to a point where too many American families live on the financial edge.  The themes of income and asset disparity, debt overhang for families, and the consequent imperiling of the opportunities for social mobility have been widely documented.  To take one of many examples, a recent report by the Corporation for Enterprise Development (CFED) found that more than 40 percent of American households are in asset poverty, meaning that they would be unable to sustain themselves even at poverty level if their current income were interrupted.  Similarly, many studies indicate that too many American families do not have either a financial cushion or the ability to obtain financing to handle an emergency expense.  Families without a “rainy day” savings cushion, moreover, are less likely to make future financial plans, such as saving for a child’s education, homeownership, or retirement.  This absence of investment for current and future purchasing power impacts the national economy.  A little later today, we will hear from Ray Boshara, who leads the Center for Household Financial Stability at the Federal Reserve Bank of St. Louis, about how to rebuild family balance sheets and its link to sustaining a strong economy. 


To begin to tackle this issue, this Commission has prioritized the financial capability of young Americans.  We have concentrated on helping Americans “start early for financial success” out of recognition that securing economic opportunity for individuals requires early action.  By helping young people make sound choices about higher education and by providing families opportunities to save for the long term, agencies across the federal government can help Americans lower barriers to upward economic mobility.


This Commission and its members have begun to take affirmative steps in this regard.  To assist the decision-making of young people with respect to pursuing higher education, the Consumer Financial Protection Bureau (CFPB) has taken important measures to provide students with the information they need to assess the advantages and disadvantages of various educational opportunities, with a focus on analyzing the financial dimensions of higher education.  The CFPB’s Paying for College resources provide easy-to-follow information to help students and their families navigate various college decisions, including applying for financial aid, comparing college costs, and deciding on student loans.  The site also has tools to help those with student loans make choices on how to manage their debt. 


The Administration has also developed new tools and approaches to help young people better manage their debt, including the Department of Education’s income-driven repayment plans available for federal student loan borrowers.  We are also working with partners in the private sector to raise awareness of these options. Last month, Treasury and Education announced a collaboration with Intuit Inc. that we hope will lead tax filers using the Turbo Tax website to the Department of Education’s Repayment Estimator, where they can determine whether they could lower their monthly student loan payments through an income-driven repayment plan, and if so, sign up online.  In addition, more than 20 million Americans will receive information about the Repayment Estimator when they receive their income tax refund checks this year.


Looking beyond education, the Administration is also undertaking efforts to enable Americans of all ages to secure a dignified retirement. In his State of the Union address last month, President Obama directed Treasury to create “myRA,” a new simple, safe and affordable “starter” retirement savings account that could help millions of Americans begin to save for retirement. myRA will be offered via a familiar Roth IRA account, and savers will benefit from principal protection, so the account balance will never go down. And the security in the account, like all savings bonds, will be backed by the U.S. government. Savers will be able open a myRA with as little as $25, and contribute as little as $5 with each payroll. 


myRA will allow workers to start to save, building the habit and expectation of saving regularly for retirement. We hope this product will be particularly valuable to young workers, who might be working multiple jobs, or part-time as they strive to move up the economic ladder.


Looking ahead, the Commission has developed a plan to take additional steps in 2014.  The Commission is announcing the following as its target outcomes for the coming year:


·         Provide guidance on common questions to regulators regarding youth savings programs. We hope this guidance will encourage more banks and credit unions to work with schools and communities to open such accounts so that more children may have opportunities to save and learn the habit of savings, along with classroom financial education.

·         Share the findings from research conducted for the Department of the Treasury on outcomes of bank and credit union savings programs paired with classroom financial education.

  • Expand resources available for federally funded social service providers to connect low-income clients to financial education and asset-building. 
  • Enable more guidance counselors to better help students and their families make sound financial decisions about higher education choices, and encourage colleges and universities to continue that guidance with their students.
  • See that more workers in the federal government and beyond will have access to financial education in the workplace to help them make informed choices to manage their current needs and debt and plan and save for their retirement.

Efforts by the federal government alone, however, are not enough.  So, today, we are very pleased to highlight the efforts of state and local leaders to address the financial capability of young people across the country.  We cannot think of anyone who better exemplifies this effort than Governor Jack Markell of Delaware, who will speak about Delaware’s “$tand By Me program,” which focuses on developing financial resources for an array of residents, including providing financial counseling to college bound students. 


Following Governor Markell, we will hear from the Treasurer of the State of Nevada, Kate Marshall; Treasurer of the City and County of San Francisco, Jose Cisneros; President of the Arizona Board of Regents, Eileen Klein; and the President and CEO of the Council on Economic Education, Nan Morrison.  These innovative leaders will describe the initiatives they are pioneering and explain how the federal government might partner with state and local governments to promote financial capability, including ways to help students select an affordable college education and methods to encourage children and families to save for college, even starting as early as kindergarten.  Some of these initiatives use matched savings to incentivize parents and students to save for their education.  Other states are using tax incentives and are exploring ways to expand the use of these programs for low and middle-income families. 


I look forward to hearing from the speakers on how this Commission can complement efforts at the state and local levels.  I believe that there are ample opportunities for federal, state and local actors to leverage off of each other. 


The strength of this Commission is that we have diverse resources and expertise across our agencies that can work together to build financial capability at key moments in the life course: children in school, youth starting their first jobs, and employees starting out in their careers.  We look forward to a robust collaboration with our state and local partners.


And soon, we hope to strengthen this broad partnership with the introduction of the President’s Advisory Council on Financial Capability for Young Americans.  This group of leaders from the private, non-profit, educational, and state, local and tribal government sectors will advise the Secretary of the Treasury and the President on how to promote the financial capability of young people as they make decisions about managing their money, pursuing higher education, and beginning to plan and save for their futures. 


Once again, I thank everyone today for their interest and their participation.  I now turn it over to Director of the Consumer Financial Protection Bureau, an agency doing so much important work on financial capability, Richard Cordray.