Guaranteed Income Works: Data from baltimore, md
Baltimore Young Families Success Fund (BYFSF)
The Baltimore Young Families Success Fund (BYFSF) provided 200 young parents with an unconditional cash payment of $1,000 per month over the course of 24 months, from August 2022 to July 2024. Launched by Mayor Brandon M. Scott, BYFSF aimed to combat the economic fallout from COVID-19 by providing payments to young parents who had been hit hardest by the crisis with schools and daycare closing, experiences of unemployment, and housing or food insecurity.
To qualify, recipients had to be Baltimore residents between 18-24 years old, be either the biological or adoptive parents, or guardians, with full or partial care-taking responsibilities and an income at or below 300% of the federal poverty level based on their household size. Independent researchers randomly selected 130 qualified applicants to receive guaranteed income through the BYFSF, and another 153 to serve as the control group. On average, BYFSF participants were in their early parenting years, with a child just under age 3.
Findings include increased financial stability, fewer work issues related to childcare, higher enrollment in post-secondary school or training programs, greater food security, less household chaos, reduced stress, and a higher level of satisfaction as parents.
Key Takeaways
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BYFSF participants were able to boost their financial well-being by paying off debt and increasing their savings, and these improvements lasted after payments ended. 24 months into the program, participants had more stable household finances and there was a statistically significant difference in debt, with 46% fewer participants reporting having credit card debt compared to the control group. There was also a significantly higher percentage of participants who had $500 or more in savings, at 12% compared to 1% of control group members.
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BYFSF participants were more likely to report doing either paid or unpaid work than control group participants, and a higher percentage of participants had income from employment compared to the control group. These trends continued after payments stopped, with 67 percent of BYFSF household income coming from employment, compared to 54 percent of control group household income.
Increased access to childcare may have contributed to fewer issues at work. At 24 months, BYFSF participants said they missed an average of 9 fewer hours of work in the past month, compared to control group members, and were 50 percent less likely than control group members to say they missed so much work they were reprimanded.
Using guaranteed income for childcare also allowed some interviewees to return to or attend school. BYFSF participants were more than twice as likely as control group members to say they had applied or were planning to apply for educational or professional training. By the end of the pilot, the percentage of BYFSF participants who were in school full- or part-time had increased to more than 20 percent, with another 26 percent in the process of applying.
BYFSF participants were also more likely to report being employed in work they found meaningful at 24 and 30 months, compared to control group members. At the 24-month survey, 39 percent more working BYFSF participants said that their job made a meaningful contribution to the world, relative to the control group.
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About half of interviewees used GI to buy food, and the rate of food insecurity was significantly lower among BYFSF participants compared to the control group. At 18 months, participants were 16 percentage points less likely to be food insecure, and this difference persisted even after payments stopped. At 30 months, participants were 20 percentage points less likely than control group members to be experiencing food insecurity.
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BYFSF helped about half of interviewed participants pay rent, and some reported using guaranteed income to pay for security deposits or the cost of moving. The percentage of participants living with a friend or relative dropped from 37% at baseline to 23% at 24 months and 19% after payments stopped. This coincided with an increase in those reporting renting, from 54% at baseline to 69% at 24 months.
At 18 and 24 months, participants reported less household chaos on average, compared to the control group, indicating guaranteed income may have helped families create more organized and peaceful home environments.
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Nearly all BYFSF participants reported that guaranteed income helped them provide for their children’s basic needs or engage their children in more enrichment activities. In interviews, participants reported that being able to provide for their children’s physical needs, from diapers and formula to healthcare expenses, alleviated stress and made them feel more satisfied and capable as parents
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Interviews indicate that guaranteed income helped reduce financial-related stress. BYFSF participants reported lower rates of stress than the control group at 24 months, and the impact may have lasted beyond the pilot, with participants reporting significantly lower scores on the Kessler scale at 30 months.
Participants were also 15 percentage points more likely to say they felt they mattered more to people around them.
BYFSF achieved goals of stabilizing young families financially and reducing barriers to economic mobility. Participants were able to afford the basics, such as rent, food, and diapers, while also being able to make choices for the long-term benefit of their families, such as paying down debt or going back to school. Importantly, the extra cash helped families with young children afford childcare, which removed barriers to employment and school. With less financial stress, BYFSF participants demonstrated better mental health, more peaceful home environments and an increase in quality time between parents and children. The success of BYFSF confirms the power of guaranteed income to improve the financial stability of families and create a more resilient economy.