Study: Mississippi Families Have Low Net WorthBy Jeffrey Hess | Published 20 Apr 2011 11:30am |
A new study shows that Mississippi families have some of the lowest net worth in the nation. MPB's Jeffrey Hess tells us what that means for Mississippians.
Net worth is a family's financial assets minus their debts and liabilities.
The national average is 88-thousand dollars, but according to a study by the Mississippi Center for Economic Policy, Mississippi families have a net worth that is around 50-thousand dollars.
Ed Sivak with the Center for Economic Policy says low wages and high cost financial services like check cashing and payday loans stores, and car title loans keep families from building up personal wealth.
"In some communities there is no bank branch. This is something that is a challenge state wide. Some of the other reasons that may exist is (they are) not comfortable using bank or they didn't see their parents use one," Sivak said.
Sivak says those service also disproportionately affect low income families.
Outside this West Jackson strip mall you can see a check advance store, a liquor store and a cash only shoe retailer.
Rhonda Adams explains that she is raising her three kids on a minimum wage job and says she doesn't use banks.
"Because I don't make enough money, I just work on minimum wage. I just have enough to keep my bills paid. I don't have enough to save right now," Adams said.
But a savings account has been a life saver Janet Walden, who has relied on it since she was laid off from her job 7 months ago.
"Most people don't have any savings or any money to fall back on. We basically live paycheck to paycheck as a lot of people usually do. But when you find yourself without a job, your savings dwindle real quick," Walden said.
Walden says her parents showed her how to use a bank, and she has helped her 9-year old daughter set up her own savings account.
Ed Sivak with the Mississippi Center for Economic Policy says getting banks into low income areas as well as teaching financial literacy, in addition to improving wages, an help Mississippi families build up more personal wealth.
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