Civic savings is a solution that builds on the roles that government can play to foster financial security and opportunity through savings.
The financial challenges faced by Americans are complex and solutions will require the participation of all sectors of the economy. While government alone cannot solve financial insecurity, government is uniquely positioned to jumpstart, coordinate, and sustain a national, state, or local focus on broader financial security and opportunity.
At Commonwealth, we believe an important solution to financial vulnerability is government championing cultural norms that signal the importance of savings, fostering policies to make innovative savings products and distribution strategies accessible to the private and social sectors, and on occasion, directly providing products to address a market failure. Government can eliminate regulatory barriers to innovation, craft and protect policies that enable broad access to the financial system, introduce tools to encourage public-private collaboration, and deliver essential consumer products at scale. Examples of this solution in action include local governments establishing Children Savings Accounts, the IRS adding a mechanism for tax filers to easily split and save a portion of their refund, providing free tax filing software to the private and social sectors, and since 1935, the Federal Government selling US Savings Bonds.