Tax Season Highlights the Importance of Providing Families with Financial Coaching to Weather Unforeseen Setbacks
Some families across the country received an unwelcome surprise this tax season, getting less in refunds than years before and, in some cases, owing the government. Unanticipated financial setbacks, like this one, can have a severe impact on working, low-income families’ wellbeing. For many families, this will mean sacrificing what the rest of us consider essential, such as phone service or utility payments. The situation can easily spiral out of control, affecting not only financial stability but relationships, health, employment and academic achievement.
Of course, this should be no surprise to U.S. families. Economic volatility is increasingly common among American families. According to the Pew Charitable Trust, more than 40 percent of families experience as much as 25 percent change in income from year to year. New Jersey families are no exception.
At the moment, 1.3 million people in New Jersey — more than one-third (37 percent) of New Jersey residents — are struggling to make ends meet, but don’t qualify for, or can’t access government assistance. These are capable families led by adults who are trying to do the right things: raise their children and succeed in life. Unexpected financial challenges such as the absence of a tax refund boost, car repair or a child’s illness force families to the brink of crisis.
If they find support, it is often focused on assisting just one family member or solving the immediate crisis rather than on long-term solutions to prevent future financial crises. But lasting financial stability is linked with many other family behaviors and requires the buy-in and cooperation of all family members, young and old, to truly succeed. Families know what they want for themselves and for their future, but they don’t always know what tools or social support they can tap into to help them get there.
The Whole Family Approach empowers working low-income families to not only become financially stable but also to reach their full potential. The Approach is a collaborative, family-led strategy in which caregivers and children together set their individual and family goals, take ownership of those goals and accomplish their dreams.
For some used to living from paycheck to paycheck, the move from “get me through this day” to “here’s where we’re going” involves an entirely different way of thinking. Families work with a life coach who helps them clarify goals for adults, children and the family unit. Goals such as better housing, improved employment or children attending college are common. The life coach suggests resources, not handouts, and concrete steps toward their goals. Those steps may involve anything from creating and following a budget to a teen taking a part-time job to contribute to the family, or adults opening a bank account to save for better housing. All focus on small behavior changes that are necessary to reach goals.
All of us know that financial stability, healthy relationships, physical health, and social and emotional well-being are intertwined. When the whole family makes progress toward individual and family goals, health and well-being improve. Long-term change and stability become realities, not just passing phases.
Family coaches encourage families to develop a network of support of other family members, neighbors, religious centers and community organizations. Social capital is a basic need. Once developed, families begin to contribute to the community well-being of others.
Organizations like ours use the Whole Family Approach to champion families and their success. At the Pascale Sykes Foundation, we know each family is different, so each family’s goals are varied and accomplished through various steps. After each goal is accomplished, the life coach stays in touch, and families frequently establish new goals that build on their stability. Children and parents begin to move higher up the socio-economic ladder.
With its focus on behavior changes, the Whole Family Approach enables families to face situations clearly, establish goals and priorities, identify appropriate resources and focus on behaviors. Others in the philanthropy space should adopt this method to provide holistic, sustainable outcomes. The Whole Family Approach acknowledges the power of a family working together as one — giving families hope that they can weather life’s unpredictable challenges and achieve their dreams. – By Frances P. Sykes
As president of the Pascale Sykes Foundation, Frances P. Sykes developed and refined the Foundation’s mission of promoting the independence, integrity and well-being of working low-income families and led its evolution into the Whole Family Approach. Mrs. Sykes received a B.A. from Smith College, and M.A. from the University of Pittsburgh
