Program to help CHA residents build savings, financial freedom comes to Chicago

One thousand Chicago Housing Authority residents will soon get the chance to build their savings and receive free financial coaching with the help of a program aiming to close the racial and ethnic wealth gap in the city.

Last week, the CHA began its gradual rollout of an initiative that attempts to make a federal program called Family Self-Sufficiency (FSS) easier to use for residents of subsidized housing.

Nonprofit funder GreenLight Fund Chicago partnered with national nonprofit Compass Working Capital and CHA to leverage the FSS program in Chicago.

FSS addresses “a bit of a disincentive” in federal rental assistance, said Jimmy Stuart, chief external affairs officer at Compass. Stuart explained that when recipients of housing assistance earn more income, their rent also goes up.

“Our clients often express to us is that, ‘I feel like I take one step forward and I'm two steps further behind,’ ” he said.

Established by the U.S. Department of Housing and Urban Development (HUD) in 1990, FSS allows a housing provider to redirect the increased rental payment into a savings account for the family. Compass adds to the benefit by providing personalized financial coaching to help participants manage debt, build savings and plan for the future.

"We have a lot of folks in our public benefits social safety net, who are making rational choices inside what is actually a very irrational system,” Stuart said. “We have a system that is, in many ways, by design, punishes people or discourages people from doing the things that we actually know are going to help them move to greater financial stability over time."

Success in other states

Compass has worked with families in 13 states to help build financial freedom. Families that Compass worked with for five years have saved an average of $8,500.

Laura Rosa, 37, joined the program in Boston in 2021. Since then, she's saved over $45,000 and started working for Compass on the strategy and client success team. She particularly enjoyed having a financial counselor, and said she thinks the program is "undervalued."

"It's been helpful, because finances is not something I sit at brunch talking about," she said. "So it was helpful to have that person give me the time and space to just get that knowledge and awareness."

She said talking about finances was "taboo" in her culture.

"I'm Puerto Rican, so it's something that was never really, as a child coming up, I never really had inside detail about it," Rosa said. "Nobody ever taught me or took the time."

In Chicago, Compass is looking to make the program easier to join. CHA has identified one thousand residents, and over the next few months Compass will be working toward getting them set up in the program, Stuart said.

“This opt-out program pilot empowers families to build wealth, achieve financial goals and ultimately transition off public assistance. It’s a proven pathway to long-term success and a journey toward dreams,” said Mary Howard, chief administrative and resident services officer with Chicago Housing Authority, in a news release.

One goal of the program is for residents to be able to handle financial emergencies or unexpected expenses with ease.

“People think of [Compass] as a housing organization, and they think about this as a housing issue. But it's really not,” said Hermilo Hinojosa, executive director of GreenLight Fund Chicago. “It's really about … that economic freedom that residents in public housing really need to get at and to really experience, to be able to…get further and further away from that poverty line.”