New York state is not doing enough to help its residents save for the future or an emergency and pay off debt, Comptroller Tom DiNapoli's office found in an audit released this week.
The audit comes after 2 1/2 years of the COVID-19 pandemic have roiled the economy and rising inflation has cut into the savings many people built up during an initial closure of many businesses and public spaces. But at the same time, many New Yorkers have not been able to build up any significant savings during that time, and struggle to pay off the money they owe.
"Many New Yorkers are trying to get through tough economic times right now. Having the right information and tools to manage their personal finances can help people be in a better position to weather both good times and bad,” DiNapoli said. “This audit found that the state agencies tasked with promoting financial education and giving New Yorkers the resources they need to safeguard their finances can improve and better coordinate their efforts.”
Even prior to the pandemic, 28% of New Yorkers made only the minimum monthly payment on their credit cards and 41% did not have savings to cover three months of an emergency. About 2.5 millon New Yorkers owed more than $37,600 on their federal student loan debt in 2020, which is slightly higher than the national average.
More than one in 10 older New Yorkers live in poverty.
DiNapoli's office audited the Department of Financial Services, the Department of State, the NYS Office for the Aging, the Office of Temporary and Disability Assistance and the State University of New York. Broadly, the state lacks a "coherent strategy" to help New Yorkers with financial literacy or inform them about available programs.
There is some collaboration among state agencies, but they lack a shared definition of what financial literacy even means.
DiNapoli's office recommended the five agencies find ways of providing more information to the public; strengthen financial education, especially for older adults; and find ways of improving a youth summer employment program.