9. Conclusion The benefits of having even a small amount of savings include increased resiliency (the ability to bounce back financially), reduced use of high-cost financial services in response to a financial emergency, and reduced household stress. However, one-third of consumers have no savings whatsoever and nearly half do not have enough saving to get by if they lose their source of income. Tax time represents a unique opportunity for many consumers, particularly low-income consumers, to make that important decision by saving all or some of their tax refund.

Given this opportune moment, it is important that VITA programs and other tax assistance providers that encourage saving utilize effective strategies to help consumers understand their options and set and reach savings goals. Our work for the past three years suggests that some promising practices include delivering a single message of saving, encouraging consumers to commit to save before they receive the funds and using an automated method to have their funds deposited into an account. 49 Taking advantage of the tax-time moment to encourage saving for financial goals, and assisting consumers in following through, can help millions of consumer who may be asset-poor to begin to build wealth and to increase their financial security and resiliency. 49 Sondra Beverly, Daniel Schneider and Peter Tufano; Splitting Tax Refunds and Building Savings: An Empirical Test.

2005. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=814007 27 CONSUMER FINANCIAL PROTECTION BUREAU .