Helping Immigrants in Chicago Reach Financial Freedom

By Sabrina Terry, Project Manager, NCLR and Ulises Silva, Director of Communications and Marketing, The Resurrection Project

One critical skill to help new citizens to fulfill their American Dream is the financial know-how of the U.S. banking system. Financial capability -- financial knowledge, counseling, and access -- is critically important for immigrants who are in the process of changing their legal status.

Latinos and other immigrants encounter several economic hurdles during the U.S. citizenship process. And once they have completed the naturalization process, they find an economy with a vast racial wealth gap. According to a 2014 Pew Research Center report, the wealth of White households was 10 times that of Latino households -- a gap that has increased since 2007 and is predicted to continue growing. Community organizations that serve the most vulnerable families are all too aware of the wealth-building challenges for the Latino community and are proactively helping new U.S citizens start off on the right foot.

To do so, community organizations across the country are working in collaboration with NCLR to execute a legal services and financial capability integration program. This program, developed with support from Citi and the Citi Foundation, is designed to positively influence the financial behavior of immigrant clients when they seek legal assistance to become U.S. citizens.

Naturalization applicants receive both application assistance and financial coaching on household budgeting and savings, how to build and maintain good credit, and savings or loan products that can help them cover the cost of the application.

While people get on a path to achieving their financial goals, the community organizations that serve them also benefit from the program. The Resurrection Project (TRP), an NCLR Affiliate in Chicago, has built a successful model that provides both legal and financial capability services to Latinos who are in the process of applying for citizenship or DACA.

TRP ensures that every legal services client receives basic financial education and an opportunity for one-on-one coaching. Last year, TRP helped 76 clients with their citizenship application--90 percent of them demonstrated an increase in financial knowledge as measured by pre-education and post-education tests. TRP also established a partnership with a neighborhood credit union, Second Federal, for clients who needed safe and affordable loan products to cover the cost of their immigration application.

The use of financial products in their model helped TRP clients improve their credit scores -- after working with a financial coach, clients with a scored credit file increased their score by an average of 21 points and for clients who previously had an unscored file, the average increase was 649 points. As a result of TRP's collaborative approach, the organization has a stronger infrastructure to serve the community. This model allows TRP to meet clients where they are in their immigration journey and help them plan for their financial future.

Today, NCLR and TRP are talking with other Chicago organizations that want to embark on this integrated services approach. During a roundtable at TRP's La Casa Student Housing & Resource Center in Pilsen, Illinois, we are discussing why integrated legal services and financial capability are critical to asset development and wealth-building in Latino communities. TRP will share their model and outline best practices from both the legal services and financial wellness staff perspectives. The roundtable is also an opportunity to learn about credit union products that can advance economic inclusion for immigrant families.

Providing financial education, coaching, and products to immigrant communities is essential if legal permanent residents are to avoid predatory products that can stall their financial growth and delay wealth accumulation.

This was first posted to the NCLR Blog.