Building Financial Stability for Households and Communities

Efforts to grow household wealth in Black and Latinx communities are vital to the well-being of our region. By increasing incomes, building assets, and reducing debt, households throughout Chicago will have the opportunity to achieve greater financial security—which has long-term effects on families, neighborhoods, and the economic health of the entire region.  

As leaders in the Trust’s work on this issue—a pivotal part of our commitment to closing the Chicago region’s racial and ethnic wealth gap—Wesley Walker and Caleb Herod share more about the Trust’s approach and why growing wealth benefits all Chicagoans.

How does the Trust approach growing household wealth? Why is it important to the overall economic health of our region? 

Wesley Walker: The Trust’s approach to growing household wealth is organized around a simple equation that income plus assets, minus debt, equals greater wealth for individuals and families. We support nonprofit organizations and community stakeholders and partners who are: 

• Providing pathways to homeownership 
• Creating education pathways that lead to a college degree or career with minimal debt 
• Providing training for jobs that grow individual net worth and create quality employment opportunities for Black and Latinx residents in the region 
• Partnering with other funders to create a support structure for small business entrepreneurs to help maintain and grow entrepreneurship in Black and Brown communities 

All of this contributes to building the overall economic health of the communities being served —which in turn will raise the viability and livability of our whole region.  
 

Why are the three objectives of the Trust’s Growing Household Wealth strategy—Increasing Incomes, Building Assets, and Reducing Debt—all critical to building stability for families in the region?  

WW: We can’t ignore how intertwined these issues are. Increasing incomes through quality employment opportunities creates a wider range of options for housing, education, access to healthy food options, and reliable transportation—to name just a few benefits. Increased income also provides individuals and families with the opportunity to build assets that can be passed down to successive generations, such as property, savings, investment vehicles, and small business ventures.  

To accomplish this, it’s necessary to reduce a family’s debt obligations. Homeownership, for example, is out of reach if a family’s debt-to-income ratio exceeds what is acceptable to a bank or lending institution.  

In the recent Financial Health Pulse 2022 Chicago report, Financial Health Network found that even achieving higher levels of income does not ensure financial health: only 40 percent of Black residents and 44 percent of Latinx residents in households making $100,000 or more say they are financially healthy, compared to 69 percent of white residents. What does this tell us about wealth disparities and financial health in our region?  

Caleb Herod: It will not be easy and we have to be clear-eyed about the challenges ahead. For generations, Black and Latinx residents have faced barriers – many of which are systemic and policy-based – that have prevented them from building and maintaining financial health. To grow household wealth equitably, we will need policy change, practice change, and mindset shifts. That seems big, but if we are intentional and work together, it is attainable.  

Homeownership remains the primary vehicle for families to build generational wealth. How do initiatives like Connecting Capital and Community (3C) and the Advancing Innovative Homeownership Financing Solutions funding program put homeownership in reach for more Chicagoans? 

WW: Homeownership is integral to closing the region’s racial and ethnic wealth gap, benefiting not just the individuals and families, but neighborhoods and larger communities. 3C is an initiative funded by JPMorgan Chase, housed at the Trust, that has built a network of developers, nonprofits, community members, and others to test innovative ideas for increasing Black and Latinx homeownership in East Garfield Park and Humboldt Park. 3C’s three priorities are increasing inventory, developing alternative lending products, and building a buyer pipeline.   

The availability of flexible, safe, and affordable capital is a huge obstacle for Black and Latinx households to purchase and sustain their homes. The Advancing Innovative Homeownership Financing Solutions program will fund collaborative partnerships comprised of a lender and housing counseling organizations to plan and design alternative financial solutions and match buyers to safe and affordable financing. 

The Trust is also focused on supporting entrepreneurship. What is the purpose of the Fund for Equitable Business Growth, and why is it important to focus on the entire ecosystem that supports entrepreneurs of color? 

WW: Small businesses are major employers, providing 58 percent of all jobs in Chicago. The Fund for Equitable Business Growth is a collaborative of nine organizations, including the Trust, which funds technical assistance, services, and support to entrepreneurs of color. For Black and Brown communities in Chicago to thrive, we must have a strong small business ecosystem that enables the businesses that provide goods, services, and jobs in these communities to thrive.  

How can Trust donors and individuals learn more and connect with the Trust’s work to grow household wealth?  

CH: Connecting with our staff at the Trust is a great start. We can provide information on ways to get involved with and support either specific initiatives or our work more broadly. We also want to create more opportunities for donors to directly connect with the organizations, individuals, and businesses that we are working with in this effort.