Financial Literacy and Education Commission, November 2016

 Resource Guide for Financial Institutions: 

Incorporating Financial Capability into Youth Employment Programs

This resource guide is for financial institutions 

interested in enhancing financial capability1

through partnerships with youth employment 

programs. It maps out how and why financial 

institutions can help young people2

 achieve 

greater financial well-being and employment 

success. 

This document highlights youth employment 

programs funded under the Workforce 

Innovation and Opportunity Act (WIOA) and 

locally-funded programs that have formed 

strong and effective partnerships with financial 

institutions. It is intended to help more financial 

institutions build on these successful 

approaches. 

Background 

As the President’s Advisory Council on 

Financial Capability for Young Americans 

concluded, “When young people receive their 

first paycheck, they are primed to learn more 

about money management and have a unique 

opportunity to make a timely and informed 

choice about their new income.”3

 Many young 

people participating in employment programs 

do not know how to access mainstream financial 

                                                            

1

 “Financial capability is the capacity, based on knowledge, skills, 

and access, to manage financial resources prudently and effectively. 

Efforts to improve financial capability, which should be based on 

evidence of effectiveness, empower individuals to make informed 

choices, plan and set goals, avoid pitfalls, know where to seek help, 

and take other actions to better their present and long-term financial 

well-being.” Executive Order 13646, see 78 FR 39159 (June 28, 

2013) 

2

 Unless otherwise specified, in this document the terms “youth” and 

“young people” generally refer to individuals aged 13 to 24 

participating in employment training programs. 

3 President’s Advisory Council on Financial Capability for Young 

Americans Final Report: https://www.treasury.gov/resourcecenter/financialeducation/Documents/PACFCYA%20Final%20Rep

ort%20June%202015.pdf

products and services. A study of youth 

participating in summer employment programs 

found that nearly half of them were unbanked at 

the start of their program.4 The Federal Deposit 

Insurance Corporation (FDIC) has found that 

households headed by individuals age 15 to 24 

are almost twice as likely to be unbanked than 

the national average, 5 and only one in five 

youth age 15-17 living at home have a bank 

account of their own. Access to a financial 

institution is a key starting point for building 

financial capability. 

It is critical to provide young people in 

employment programs with the appropriate 

resources to encourage financial capability. 

Youth employment programs can support this 

mission by incorporating financial education 

and access to safe and appropriate financial 

products. When these components are 

presented together, they result in even more 

effective financial capability outcomes for youth 

than if either component is presented alone. 

Efforts have proven to be most effective when 

both the education and access are customized to 

participants’ needs. In order to create these 

successful programs, a partnership with a 

financial institution is essential. 

What are WIOA programs and how do they 

expand youth financial capability? 

WIOA6

 was enacted in July 2014 to provide 

funding, resources, services, training, 

                                                            

4

 Cities for Financial Empowerment Fund, Summer Jobs Connect: 

More Than A Job, at 18 (February 2015), available at: 

http://cfefund.org/info/our-projects#summer-jobs-connect 5

 2015 FDIC National Survey of Unbanked and Underbanked 

Households (October 2016), available at: 

https://www.fdic.gov/householdsurvey/ 6

 Workforce Innovation and Opportunity Act. Public Law 113-128, 

July 22, 2014 
Financial Literacy and Education Commission, November 2016 – Page 2 

leadership, and support for workforce 

development and related programs across the 

country. The law is intended to improve an 

individual’s prospect for success in the labor 

market, by helping him or her find, train for and 

maintain a job. WIOA also helps businesses by 

connecting them with potential employees. 

Under WIOA, the U.S. Department of Labor 

(DOL) supports youth employment programs 

that provide paid employment opportunities for 

low- and moderate-income in-school youth, 

ages 14 to 21, and out-of-school youth, ages 16 

to 24, who meet other eligibility requirements. 

Locally funded programs may use different 

definitions of youth for eligibility purposes, but 

often target this same age group.

WIOA differs from past legislation related to 

federal job training programs by including 

financial literacy as a program element. A local 

recipient of WIOA formula funds must offer or 

make available a financial literacy curriculum or 

training to youth participating in its local 

workforce program. The training must support 

youth’s ability to create budgets, open checking 

and savings accounts at financial institutions, 

learn about credit, and make informed financial 

decisions.7

 As this is now a requirement for 

many youth employment programs, there is an 

even greater opportunity for collaboration with 

financial institutions. 

 

Example: In St. Louis, M.O., the St. Louis 

Agency on Training and Employment 

(S.L.A.T.E.), a WIOA formula fund recipient, 

has partnered with a local credit union to offer 

a robust financial literacy training and a 

tailored transactional account for all youth 

participants. During the enrollment process for 

the Summer Youth Employment Program 

(SYEP), youth applicants are assigned a trained 

job coach, who explains the benefits of banking 

and can help facilitate an account opening with 

the partner credit union at that moment. 

Participants are required to enroll in direct 

                                                            

7

 DOL, WIOA Final Rule, https://doleta.gov/wioa/Docs/wioa-regslabor-final-rule.pdf 

deposit, and continue to interact with the 

trained job coaches throughout the summer. 

How can youth employment programs help 

participants build financial capability? 

Youth employment programs have many ways 

to help participants build financial capability. 

Some programs match young workers with 

mentors or coaches, to help them identify 

savings goals and develop budgeting skills to 

work toward these goals. Young workers also 

work with these mentors and coaches to learn 

about building credit and how to repair a credit 

history. Teaching young people how to manage 

their finances effectively can prevent them from 

misusing credit. Some programs have found it 

effective to offer incentives to develop good 

habits. A recent study has documented that a 

combination of these items has measurable 

impact on knowledge and positive financial 

actions.8

Programs can provide youth with information 

about and access to a range of available 

financial products and services so they can 

make informed decisions about which ones best 

meet their needs. This can range from directing 

them to free or low-cost direct deposit accounts 

to providing connections to federal financial aid 

information for youth who are interested in 

college or career school. Federal resources at 

the end of this document provide information 

and tools to help. 

Example: In New York City, the local SYEP is 

helping youth build financial capability by 

encouraging direct deposit. NYC SYEP has 

incorporated financial nudges into the online 

application and enrollment process, to educate 

about and encourage sign-up for direct deposit 

and split savings. Since prioritizing direct 

                                                            

8 Vernon Loke, et al., Boosting the Power of Youth Paychecks: 

Integrating Financial Capability into Youth Employment Programs, 

at 4 (April 2016), Federal Reserve Bank of San Francisco & MyPath 

available at: http://mypathus.org/wpcontent/uploads/2014/09/Boosting-the-Power-of-YouthPaychecks.pdf. 
Financial Literacy and Education Commission, November 2016 – Page 3 

deposit, 30 percent of participants, about 

16,000 youth, are now enrolled, up from zero 

participation a few years ago. All participants 

are also required to participate in an 

orientation that covers financial management 

and the benefits of using a bank account. 

What are the opportunities for financial 

institutions to work with youth employment 

programs? 

Many financial institutions are deepening their 

engagement with communities by working with 

workforce programs, non-profit organizations 

and others to deliver financial education that 

meets the needs of the programs and the youth. 

Financial institutions are also tailoring their 

financial products and services to better serve 

participating youth. 

Financial institutions find that working with 

youth employment programs can connect them 

to a new, young set of customers or members 

and future employees. Youth in these programs 

have been encouraged, and in some cases 

incentivized to participate in financial education 

workshops, seminars or games, sign up for 

direct deposit, save regularly, or reach a specific 

financial goal. 

Additionally, some financial institutions have 

expanded economic opportunities for youth by 

offering internships and employment 

opportunities in connection with workforce 

programs. These financial institutions help lay 

the foundation for a diverse and more inclusive 

workforce. WIOA programs may be able to 

further contribute to these efforts. 

Example: In Washington, D.C., two local 

financial institutions have partnered with the 

DC SYEP and Bank On DC to offer free 

checking and savings accounts, which can be 

opened online. One of the accounts offered is a 

non-custodial account, open to participants age 

14 and older. The program also hires and 

trains peer educators, known as Young 

Money Managers, to teach financial education 

workshops to all SYEP participants at their 

employment sites. DC SYEP also uses a 

self-paced online platform that youth 

participants may access even after their summer 

employment ends. 

What are youth-friendly account features 

and services that financial institutions may 

offer? 

Young people save more when given the 

opportunity to open accounts that come with 

youth-friendly account features. 9 When 

financial institutions create products using safe 

youth account standards10 (such as those based 

on the Bank On National Account Standards11), 

it results in higher account enrollment rates. 

Many financial institutions have been successful 

in meeting the financial needs of young people 

through one or more types of savings and 

transaction accounts, including linked accounts. 

These generally are savings and checking 

accounts that are linked by an account number 

and enable the customer to keep the majority of 

his or her funds in the savings account and 

move money into the transaction (demand) 

account, as needed. 

The most typical features for youth-friendly 

accounts include no minimum or starting 

balance, zero or low monthly and minimum 

balance fees, no overdraft capability, no 

dormancy or inactivity fees, free and 

unrestricted access to customer service, free 

online/mobile banking and bill pay, ability to 

add cash or other direct deposit sources to the 

account/card without fees, and free and 

unrestricted use of in-network Automated Teller 

Machines (ATMs). 

                                                            

9

Vernon Loke, et al., see note 7. . 

10 Federal Reserve Bank of San Francisco & MyPath, Boosting the 

Power of Youth Paychecks: Integrating Financial Capability into 

Youth Employment Programs, at 4 (April 2016), available at: 

http://mypathus.org/wp-content/uploads/2014/09/Boosting-thePower-of-Youth-Paychecks.pdf. 11 Bank On National Account Standards: 

http://www.joinbankon.org/wp-content/uploads/Bank-On-NationalAccount-Standards-2015-2016-Final.pdf
Financial Literacy and Education Commission, November 2016 – Page 4 

Financial institutions have successfully opened 

accounts for many youth at once, by allowing 

remote account opening (such as during 

registration for the employment 

program). Financial institutions may be able to 

work with partners to assist in opening accounts 

using student IDs, municipal IDs, program 

documentation or other reasonable means of 

identity verification consistent with the financial 

institution’s policies and procedures.12 

Some youth employment programs have found 

that having non-custodial accounts for young 

workers that do not require an adult custodian to 

cosign or guarantee the account, is beneficial 

because it empowers youth to manage their own 

money and work for their own savings goals. 

Regulatory agencies have released guidance to 

encourage financial institutions to develop 

youth savings programs. This guidance may be 

helpful in developing transaction products for 

working youth.13 

Example: In San Francisco, a non-profit 

organization works with a local financial 

institution to provide two different youth savings 

accounts: previously, a restricted savings 

account to encourage participants to meet a 

savings goal, and a regular savings account tied 

to an ATM card. New transaction accounts are 

also available. Both accounts have low fees, do 

not require parental signature, and cannot be 

overdrawn. The program supports setting 

personal financial goals and includes incentives 

to succeed. Since 2011, participants have saved 

over $850,000. 

Example: In Chicago, several financial 

institutions have partnered with Bank On 

Chicago and One Summer Chicago to place 

nearly 25,000 youth ages 14 to 24 in summer 

                                                            

12http://www.ffiec.gov/bsa_aml_infobase/documents/BSA_AML_M

an_2014_v2.pdf    13 Guidance to Encourage Financial Institutions’ Youth Savings 

Programs and Address Related Frequently Asked Questions, 

February 24, 2015. https://www.treasury.gov/resourcecenter/financial-education/SiteAssets/Pages/commissionindex/Final%20Proposed%20Youth%20Savings%20Guidance%200

3022015%20Clean.pdf 

employment and learning opportunities and to 

provide participating youth with accounts. 

These financial institutions offer products that 

have no monthly fees, minimum balances, and 

overdraft-capability. An adult co-signer is not 

required for any participating youth over age 

16. Most allow youth to receive an ATM and 

debit card, and some allow accounts to be 

opened remotely. Many of the partnering 

financial institutions also have mobile apps, so 

young people can manage their accounts from 

a mobile phone. 

What are the Community Reinvestment Act 

(CRA) implications for banks to work with 

youth employment programs? 

The CRA was enacted to encourage banks and 

savings associations (collectively, banks)14 to 

help meet the credit needs of all segments of 

their communities, including low- and 

moderate-income neighborhoods and 

individuals. CRA and its implementing 

regulations require the three federal banking 

agencies (FDIC, the Fed and the OCC) to access 

the record of each bank in meeting the credit 

needs of its community and to consider that 

record in evaluating and approving applications 

for charters, bank mergers, acquisitions, and 

branch openings. 

Financial literacy and education programs targeted 

to low- and moderate-income youth that are 

responsive to community needs may receive 

favorable consideration as responsive, innovative, 

or flexible services, or as community development 

activities under the CRA, depending on the size 

and type of the institution and type of CRA 

evaluation. 

CRA consideration may also be given to banks 

that provide retail banking services that improve 

access to financial services, or decrease costs, 

for low- or moderate-income individuals, such 

as low-cost deposit accounts. Examples of bank 

support for financial literacy programs that may 

                                                            

14 CRA applies to FDIC-insured depository institutions, such as 

national banks, savings associations, and state-chartered commercial 

and savings banks.
Financial Literacy and Education Commission, November 2016 – Page 5 

receive favorable consideration under CRA 

include15: 

 Investments in, or contributions to a 

program, activity, or organization that 

provides credit counseling, personal money 

management, and other financial services 

education programs targeted to low- and 

moderate- income youth. 

 

 Investments in organizations supporting 

activities essential to the ability of low- and 

moderate-income individuals or geographies 

to utilize credit or to sustain economic 

development, such as, job training programs 

or workforce development programs that 

enable low- or moderate-income individuals 

to work. 

 Providing bank staff to serve as educators in 

financial literacy programs targeted to lowand moderate-income youth. 

What are other incentives for financial 

institutions to work with youth employment 

programs?

The Community Development Financial 

Institutions Fund (CDFI Fund), part of the U.S. 

Department of the Treasury, supports missiondriven financial institutions working on a local 

level. Financial institutions that become 

certified by the CDFI Fund are eligible to apply 

for the comprehensive services it offers, 

including monetary support and training to build 

organization capacity.16 Through the Bank 

Enterprise Award Program (BEA Program), the 

CDFI Fund provides monetary awards to FDICinsured financial institutions that successfully 

demonstrate an increase in their lending, 

investing, or service activities in distressed 

communities, including youth savings 

accounts.17

                                                            

15 Community Reinvestment Act; Interagency Questions and 

Answer Regarding Community Reinvestment 

https://www.gpo.gov/fdsys/pkg/FR-2016-07-25/pdf/2016-16693.pdf 16 https://www.cdfifund.gov/Documents/CDFI_Brochure.pdf 17 https://www.cdfifund.gov/programstraining/Programs/bank_enterprise_award/Pages/applystep.aspx#step12

For credit unions specifically, the Federal Credit 

Union Act provides that federal credit 

unions were organized for, among other things, 

promoting thrift among members.18 This 

provision is the basis for credit unions’ youth 

savings programs, and can be the basis for 

working with youth employment programs. 

How do financial institutions get in touch 

with youth employment programs and get 

involved? 

Financial institutions can find their appropriate 

state and local Workforce Development Board 

or related contacts at: 

http://www.servicelocator.org/workforcecontact

s.asp.

Financial institutions can reach out to 

community affairs officers from their respective 

regulatory agencies for more information (see 

below). Local government agencies that work 

on financial capability and Bank On Programs 

may also be able provide links to youth 

employment programs. 

                                                            

18 12 U.S.C. 1752(1)
Financial Literacy and Education Commission, November 2016

Resources to Support Financial Institution and Youth Employment Program Partnerships 

Regulatory Agency Community Affairs Contacts 

 Federal Reserve Banks (Fed): https://www.federalreserveeducation.org

 Federal Deposit Insurance Corporation (FDIC): http://www.fdic.gov/consumers/communit

 National Credit Union Administration (NCUA): https://www.ncua.gov/consumers/Pages/financialliteracy-resources.aspx

 Office of the Comptroller of the Currency (OCC): http://www.occ.gov/topics/communityaffairs/index-community-affairs.html

Federal Government 

 Adminstration for Children and Families (ACF) and Consumer Financial ProtectioN Bureau 

(CFPB)’s Building Financial Capability in Youth Programs, Insights from Roundtable: 

http://files.consumerfinance.gov/f/201408_cfpb_report_financial-capability-in-youth-employment-programs.pdf

 CRA Regulation Resources: https://www.ffiec.gov/cra/ 

 DOL’s WorkforceGPS: https://www.workforcegps.org/ 

 FDIC’s Model Safe Accounts Template: https://www.fdic.gov/consumers/template/template.pdf 

 FDIC’s Money Smart: https://www.fdic.gov/consumers/consumer/moneysmart/young.html 

 Federal Student Aid’s Preparing and Paying for College: www.studentaid.gov 

 Financial Literacy and Education Commission (FLEC) background and financial education 

resources: http://www.mymoney.gov/Pages/for-youth.aspx

 Guidance to Encourage Financial Institutions’ Youth Savings Programs and Address Related 

Frequently Asked Questions (February 24, 2015): 

https://www.federalreserve.gov/newsevents/press/bcreg/bcreg20150224a1.pdf

 NCUA’s MyCreditUnion.gov: http://www.mycreditunion.gov/Pages/default.aspx 

 OCC’s Community Developments Insights - School-Based Bank Savings Programs: 

https://occ.gov/topics/community-affairs/publications/insights/insights-school-based-bank-savings-programs.pdf

 President’s Advisory Council on Financial Capability for Young Americans Final Report: 

https://www.treasury.gov/resource-center/financial-education/Documents/PACFCYA%20Final%20Report%20June%202015.pdf 

 SEC Student Resources for Saving and Investing: https://investor.gov/outreach/students

 Social Security Administration Resources for Young People: 

https://www.ssa.gov/people/youngpeople/saving.html

 WIOA Resource Page: www.doleta.gov/wioa 

Non-Government 

Please note that these resources have not been supported or endorsed by the FLEC and may not be an 

exhaustive list of materials on this topic. 

 

 America Saves for Young Workers: http://www.americasaves.org/organizations/currentinitiatives/first-time-workers 

 Cities for Financial Empowerment Fund Summer Jobs Connect: http://cfefund.org/info/ourprojects#innovation-center 

 Federal Reserve Bank of Boston’s Leveraging Financial Education to Improve the Impact of 

Workforce Innovation and Opportunity Act (WIOA): 

 http://bostonfed.org/commdev/conf/2015/leveraging-financial-education/index.htm

 MyPath: http://mypathus.org/ 

 National League of Cities Municipal Action Guide: http://www.nlc.org/Documents/Find%20City%

 20Solutions/IYEF/Family%20Economic%20Success/YE-FC%20Mag%20Pub_finaldraft%20v2.pdf