Brief Do Asset Limits in Social Programs Affect the Accumulation of Wealth?
Henry Chen, Robert I. Lerman
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In providing benefits to people without resources to support themselves, public assistance programs must define what counts as resources. Typically, programs consider assets and income in determining assistance eligibility. However, valuing assets can be difficult, and asset tests create disincentives to save. In some cases, one additional dollar of assets can result in the loss of benefits worth thousands of dollars. Current practices raise two questions: Are asset tests fair? and Do asset tests discourage asset accumulation? This brief identifies the population subject to asset tests, reviews existing research, considers strategies for meeting objectives, and offers suggestions for additional research.
Research Areas Wealth and financial well-being Social safety net Housing
Tags Federal housing programs and policies Poverty Low-Income Home Energy Assistance Program (LIHEAP) Asset and debts Temporary Assistance for Needy Families (TANF) Hunger and food assistance Housing vouchers and mobility Supplemental Security Income (SSI) Public and assisted housing