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Financial Education Empowers Financial Equity Financial education is crucial to achieving financial equity in a more inclusive global digital economy. But what does it mean in the first place? Financial education is about empowering you to effectively navigate personal finances, budgeting and investing. People with access to greater financial education tend to: Save for retirement Set aside non-retirement savings More easily navigate unexpected expenses Be less financially fragile overall Even though financial education is critical for individuals to succeed in the digital economy, the curriculum needed is far from commonplace in American schools. This is where financial equity comes into the equation. The lack of financial education disproportionately impacts communities of color – according to the FDIC, 47.3% of all African American households and 42.9% of all Latino households are financially underserved. Managing money outside of traditional banking systems because of a lack of education and trust is expensive, with underserved households spending an estimated $38 billion each year on alternative financial services alone. Master Your Card and Mastercard are on a Mission to Achieve Financial Equity for All Since 2011, Master Your Card (MYC) has been working to bridge the financial knowledge gap through financial education resources, partnerships with community leaders focused on financial literacy, and electronic payments technology. To date, MYC has reached more than 55,000 students with financial education resources, engaged with thousands of individuals and small business owners through events and trainings, and partnered with more than 120 committed organizations to empower equity in local communities across America. In 2020, as America has battled impacts of the COVID-19 pandemic and woken up to national calls for racial equity, we’ve set our sights even higher. This summer, Mastercard announced it is investing $500 million in Black communities across the U.S. through a variety of programs across the country. In parallel, Master Your Card has conducted financial empowerment digital sessions and launched new resources built for remote learning. Master Your Card’s Financial Literacy Resources Include: Educational sessions through Mastercard Volunteers, including presentations and webinars, engaging videos and educational handouts to get small business owners and individuals set up for financial literacy. Empowerment through partner organizations, including training community facilitators who will pass the knowledge on to their networks and collaborate on resources and thought leadership with some of the most inspirational leaders in financial and racial equality. Self-guided virtual resources through the Master Your Card website, including interactive financial education platforms, and customized toolkits for community educators, individuals and small business owners Find out how Master Your Card can work with you, your city or organizations in your community by clicking here [link to Allies two-pager]. You can also keep up with all Master Your Card happenings by following us on Twitter, Facebook or LinkedIn.

Using cash to manage your money sounds straightforward, but it will end up costing you more money in the long run. Unbanked individuals, those that do not have any type of bank account, tend to manage their finances solely in cash and rely on alternative financial services such as check cashing centers.  According to a 2019 survey conducted by the FDIC, 5.4% of households in the United States are unbanked – that’s 7.1 million households.1 An additional 17.2% of U.S. households (21.3 million) are underbanked, meaning that the household has either a checking or savings accounts, but still relies on alternative financial services. Black and Hispanic communities are disproportionally impacted by the burden of being unbanked. In fact, the abovementioned FDIC study found that 13.8% of Black households and 12.2% of Hispanic households are unbanked. This is compared to just 2.5% of white households. In addition to being inconvenient and time-consuming (think of all the hours spent going to a check-cashing center and paying your bills in person with cash!), being unbanked is expensive. In 2019, unbanked and underbanked Americans spent $189 billion in fees and interest in alternative financial products. 2 Getting out of an expensive cash economy can help individuals and families participate and get ahead in today’s economy. Electronic payments provide greater value in buying power, convenience, safety, and financial management. One example of an electronic payment is the use of reloadable Prepaid cards.  Prepaid cards don’t require a bank account or having a credit history. Funds are loaded, and reloaded, onto a prepaid card account. The benefits of Prepaid Cards include: Saving time and money. Payment cards save customers time and money by avoiding a trip to a check-cashing center and paying fees to cash a check. With Prepaid Cards, paychecks can be electronically deposited onto prepaid card accounts, eliminating check cashing centers and fees altogether. Banking on your card. Use a Prepaid Card to pay bills online or over the phone and save the cost of buying money orders. Many cards come with financial management tools for budgeting and tracking expenses. These tools can be used to track spending and stick to a financial budget. Using cash, in contrast, can make it more difficult to keep records, track expenditure and maintain a budget. Feeling more secure. Payment cards reduce threats to personal safety associated with obtaining and carrying large amounts of cash. Unlike cash, cards that are lost or stolen can easily be replaced. Interested in learning more about Prepaid Cards or enhance your financial knowledge? Check out our toolkit for individuals to learn all you need about payment cards, credit scores, and more.   1  Federal Deposit Insurance Company (FDIC). (2019). FDIC National Survey of Unbanked and Underbanked Households. https://economicinclusion.gov/ 2 Financial Health Network. (2019). “Financially Underserved Market Size”