Back to normal? We can do better than that.

Part I: Income Volatility

The deep cracks that exist in the financial lives of millions of Americans were ripped open by the economic fallout of COVID-19. Millions of families lack the ability to survive a financial emergency, be it a personal emergency, a natural disaster, or in this case, an unprecedented global pandemic. This was true before COVID-19 and will remain true after this crisis subsides if we do not take swift action to address root problems. We cannot go back to normal. We must do so much better.

We are grateful to the Mastercard Center for Inclusive Growth and the W.K. Kellogg Foundation for supporting this work.

Today we release the first of four reports that spotlight how pre-existing financial inequities are now causing widespread suffering throughout our communities. 

First up: the crushing effects of pervasive income volatility that make it so hard for people to get ahead and stay ahead. 

In 2019, California SaverLife members told us in no uncertain terms that “a more consistent work schedule” was the number one thing that could change their financial lives for the better. This came as no surprise. The data from our two-year deep dive on income volatility validated their concerns. More than 70% of SaverLife members experience frequent dips and spikes in income of over $1,000 month-over-month.

At SaverLife, we turn insights into action. In this report we describe:

• How our research led to an overhaul of our entire product

• How we prototyped new approaches for consistent savings despite inconsistent incomes

• Results from three savings interventions designed to address how people really experience income and expenses

• Our plans to continue building on our progress

These innovations are now helping us face the mother of all income disruptions – the financial freefall of COVID-19. We are using the income volatility tracker we developed to identify families experiencing a sudden drop in income of 25% or greater and distributing $500 emergency savings boosts directly to their accounts.

Next up: A report on the household financial impact of government fines and fees in partnership with the Financial Justice Project.