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Washington, D.C. has a lottery and nearby casinos, but both are more interested in taking your money than in your winning it.  

Then there is Capital Area Asset Builders (CAAB), a non-profit that can help many low-income D.C. residents increase their financial stability. Unlike government-run lotteries or casinos, says director Richard Petersen, CAAB wants to help empower low and moderate-income residents of the region to increase their savings, to learn how to manage their money better, and to build wealth for the future through savings.  

It’s a timely message, particularly since new reports from the Federal Reserve showed that only four in ten American adults would be able to pay a sudden $400 emergency expense. Too many households in D.C. are not financially stable.    

With a new year coming up, it is a good time to start thinking of how you might better manage your money. Recently, I sat down with Joseph Leitmann-Santa Cruz, associate director of CAAB. He described some steps that D.C. residents with low or moderate incomes should take to keep and obtain more money. 

It starts with setting realistic goals. Many of CAAB’s clients set such goals to fund their education, obtain housing or purchase a  vehicle, start a small business or simply strengthen their financial security. Leitmann-Santa Cruz also advises people to determine how much money they are spending per month, then develop a realistic budget and stick to it. Every dollar not spent on unnecessary expenses such as eating out is a dollar that can be saved. 

The next step is to establish an account with a bank or credit union. According to one of the federal reserve reports, 30 percent of D.C. families lack sufficient bank accounts and instead “use, sometimes heavily, expensive alternative financial services such as check cashing, payday lenders, online lenders and wiring money.  

D.C. households are among the highest in the nation when it comes to unbanked households, meaning they lack an account with an established financial institution, relying instead on costly Alternative Financial Services (AFS) to cash checks, obtain loans, and to transfer money. Overall, nearly 30 percent of D.C. households are unbanked or underbanked; the latter are households with regular financial accounts but who also used AFSs within the past year too. 

Setting up a bank or credit union account can introduce newcomers to savings and to financial products such as retirement accounts and credit cards. But families should first compare banks and credit unions to learn what fees they charge. “Make sure your account is working for you,” Leitmann-Santa Cruz says.  

A regular savings strategy is important in planning for “life happens” situations. Something is always going to happen that will eat away your money, such as an unanticipated medical expense. Ideally, you should have a regular savings account and an emergency account.  

Accessing your credit report is another crucial step. You need to be creditworthy to obtain loans and credit cards, rent property and obtain employment, even if you have money. Leitmann-Santa Cruz recounted how one CAAB client’s job was in peril until she took steps to fix her credit rating. As we move increasingly toward a cashless society, it’s more important than ever to have good credit.  

Free tax preparation services can help you report your income for 2018. “The Earned Income Tax Credit is the most effective poverty alleviation program this country has,” Leitmann-Santa Cruz says. “Too many Washingtonians do not take advantage of it.” 

For example, by filing their D.C. and federal income tax forms, a family of four in D.C. with income up to $25,000 can receive back as much as $9,000.  

But be sure to use free tax preparers–such as those offered by non-profits–rather than the big chain preparers to ensure you keep all of what’s yours. Check CAAB’s website for a list of places where you can find such help before taxes are due on April 15.  

CAAB offers more too–including classes–and all of their programs are free. Check out their webpage for success stories of D.C. residents who, through CAAB’s help, made their goals come true.    

So if you want to end up with more money in your bank account this coming year, visit CAAB at www.caab.org! 

Steve Lilienthal is a freelance writer.