The Power of Paradox to Build Financial Well-Being
It’s been a year since the release of What It’s Worth: Strengthening the Financial Future of Families, Communities and the Nation, and authors and readers from across the country have engaged in rich discussion on the topic of financial health. One of the things I’ve come to appreciate most from these conversations is the subtle paradox of what it takes to build financial well-being for families and communities across the nation.
Many of the solutions described in the book embrace the complex challenge of affecting systems-level change, such as cross-sector coordination, equity-based policy reform and integrated approaches that incorporate financial capability into health, education, employment and prisoner reentry services.
But a number of authors also make clear that such approaches must be grounded in the simplest of principles: trust, hope, and a belief in the productive capacity and strength of every person. Without these fundamental elements, even the most well-thought-out systems-level solutions are bound to fail.
“Paradox,” Presidio Graduate School President William Shutkin said, “is really just another name for the tension that resides in all of us, the contradictory impulses and beliefs that can alternately deflate or invigorate us. It is a creative tension that, like a motor, propels us from one state of being to the next, making the very act of change possible.”
Shutkin’s words serve as a vital reminder that although this is hard work, complicated work — and deeply frustrating work at times — it is also an opportunity to move forward.
The scale of financial insecurity and inequality in this country is indeed astounding. In a world of collective action and an understanding of poverty as a complex adaptive system, it can be overwhelming to know where to start. But we must move forward.
This is the beauty of paradox as a driving force for change: In the effort to build financial well-being, we cannot and must not choose between simplicity and complexity. Our solutions are not either/or. They are both/and.
We must engage in the messy and complex work of addressing the interconnections of race, place and economic opportunity while honoring the cornerstones of family, culture and trust. We must be willing to persist in the long battle for data-sharing agreements that expand our understanding of financial well-being metrics. But we must also balance our quest for big data with the simple question of whether a person feels in control of his or her life.
I believe that financial well-being is both a stop on the road and a predictor of success for virtually every outcome that we collectively care about — from health, education and employment to economic growth and social stability. Put differently, the road that gets to those important outcomes runs through a way station of household financial well-being.
As we enter 2017, let’s embrace both complexity and simplicity, and allow the creative tension of paradox to invigorate and energize each of us in the pursuit of financial well-being for all.
Laura Choi is a Senior Research Associate in Community Development at the Federal Reserve Bank of San Francisco.
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