A bipartisan bill has been introduced in the House of Representatives that would allow the Consumer Financial Protection Bureau to use money it receives from fines assessed in enforcement orders to fund financial education programs in schools, libraries, and non-profit organizations nationwide. If enacted, the CFPB would be allowed to use up to $15 million per year to fund such programs.
More information about H.R. 9272, the Consumer Financial Education and Empowerment Act, which was introduced by Rep. David Scott [D-Ga.], the chair of the House Agriculture Committee, can be accessed by clicking here.
Among the topics that would be allowed to receive funds through the program are:
- personal financial wellness
- credit and alternatives to credit
- management of student loan debt
- preparation for homeownership
- basic investing
- financial saving, planning, and management
- tax planning
- personal information security
- preparation for household changes, including merging assets after marriage and preparing for costs associated with children
The programs can not be self-taught and must include an in-person instruction component, such as in a classroom, via a webinar, or one-on-one financial coaching.
Programs would have to submit an application to the Director of the CFPB in order to be approved and to receive funding. In the first year following enactment, the Director would be able to use up to $30 million of the CFPB’s Civil Penalty Fund to fund education programs. In subsequent years, the Director would be limited to the lesser of either $15 million or 20% of the amount remaining in the fund after allocation to victims has been determined.
“Today, far too many Americans struggle with decisions around financial planning, saving, and investing. This lack of basic financial education often leaves consumers vulnerable to potentially avoidable financial pitfalls,” said Rep. Scott, in a statement. “My bill will allocate vital financial education resources, thus allowing consumers to make better informed decisions regarding their personal finances while improving the overall financial health and well-being of their families.”
The bill has been endorsed by the Association for Financial Counseling & Planning Education (AFCPE), Local Initiatives Support Corporation (LISC), Credit Builders Alliance (CBA), National Association for Latino Community Asset Builders (NALCAB), National Disability Institute (NDI), National Endowment for Financial Education (NEFE), National NeighborWorks Association, and Operation Hope.