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News for Researchers

Disabled Americans Still Economically Shortchanged Despite Law

July 24, 2014
Source: U.S. News and World Report

Research shows that people with disabilities have significantly lower capabilities in personal financial planning, on top of numerous employment challenges.

Seventy percent of disabled Americans say they would not be able to scrape together $2,000 in an emergency within the next month.

As the United States marks the 24th anniversary of the landmark Americans with Disability Act (ADA), a leading research institute says that adults with disabilities continue to be economically shortchanged despite the laws promise.

In anticipation of the July 26 anniversary of the law, the National Disability Institute (NDI) released the results of a study and survey showing 70 percent of those with disabilities said they could not scrape together $2,000 in an emergency within the next month, as compared with 37 percent of people without disabilities.

Speaking at the release of the findings Tuesday, Gail Hillebrand of the Consumer Financial Protection Bureau said they illustrate the financial fragility of many people with disabilities.

“We know that having a rainy-day fund, having savings, takes some of financial worries off of life,” Hillebrand said. “We know that it gives consumers power in the credit market, because now you are deciding whether to borrow, not how to borrow.”

The survey also found that people with disabilities are twice as likely to only have a checking account as other respondents, who have both checking and savings accounts. And only 12 percent of disabled people frequently use credit cards, almost 20 percentage points lower than the average person, according to the report.

The findings “present a picture we thought would be better after 24 years,” Michael Morris, executive director of National Disability Institute, said. “We are not alone in thinking about these issues, and urgently we need to do more.”

For the disabled community, the concept of financial literacy is elusive, said Kathy Martinez of the Labor Department, who was born blind and now serves as the assistant secretary at the agencys office of Disability Employment Policy.

“We are under-banked, or unbanked,” Martinez said. “I see this as a real opportunity for the financial services sector to work with us, work with the [Consumer Financial Protection Bureau], work with the IRS to help address some of these issues.”

The Internal Revenue Service (IRS) is seeking to improve understanding and access of tax benefits among people with disabilities through a program called SPEC (stakeholder partnerships, education and communication). Debra Holland, commissioner of the wage and investment division at the IRS, said it is crucial for people with disabilities to take advantage of refunds and income tax credits to build their assets and investments.

Hillebrand said her consumer bureau is working to improve financial education by offering practical help so those with disabilities can develop financial skills and make better choices early in life.

“For persons with disabilities, its especially important to make sure that education is not saved for college, that its offered in high school, and perhaps even earlier,” Hillebrand said. “Whether its small savings, or banks in schools, things they can do to touch money and think about it as something real, not something thats for somebody else.”

According to 2012 census data, only one in three individuals with disabilities between the ages of 18 and 64 is employed, a far smaller footprint in the workforce than adults without disabilities.

The goal of the Americans with Disabilities Act was to “assure equality of opportunity, full participation, independent living, and economic self-sufficiency” for people with disabilities.

But Hannah Rudstam of Cornell Universitys Employment and Disability Institute said the ADA is not a quota-based law.

“It guarantees equal employment opportunity, it doesnt guarantee the outcome,” Rudstam said. “You cant legislate employers negative attitude.”

More information: National Disability Institute Report on the Financial Capability of Adults with Disabilities at

NDI Press Release July 22

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