The U.S. Can Create True Wealth by Giving Cash to Parents Who Need It

The mix of basic cash and the space to dream can lead to transformation.

Advocates gather outside the White House to advocate for the child tax credit in advance of the White House Conference on Hunger, Nutrition, and Health on Sept. 20, 2022. (Larry French / Getty Images for SKDK)

Editor’s note: The House passed a bipartisan bill last month that would allocate $78 billion to expand the child tax credit. It now heads to the Senate, where it face obstacles to passage. If passed, the Tax Relief for American Families and Workers Act of 2024 would help an estimated 16 million children this year and lift 400,000 out of poverty, with a disproportionate positive impact on children of color. (The bill also restores three business tax breaks and directs investments to low-income housing development.)

Late last year, Aisha Nyandoro spoke at the TEDWomen conference on her experience creating the Magnolia Mother’s Trust (MMT). Launched in the fall of 2018, MMT provides low-income mothers in Jackson, Miss., with $1,000 a month for a year. Now in its fifth cohort, the trust has served over 400 moms, making it the longest-running guaranteed income program in the country. Across the country, guaranteed income pilots like MMT are finding that recipients are overwhelmingly using their payments for basic needs like groceries, housing and transportation.

Watch or read her TED Talk below, which highlights the positive effects of unrestricted cash assistance to parents.

Growing up in Mississippi, my family never talked about money. But I inferred how much everyone had by pattern-keeping at Christmas time. 

You could count on Uncle Chip for cold hard cash—an absolute delight. JC Penney here I come!

My MaDear would always give apples, oranges and butterscotch candies in a brown paper bag. Disappointing, but no one would dare disparage the matriarch of the family. 

My parents would always make sure my twin and I had the latest fashions—whether it was Gibaud jeans or a Starter Jacket. Looking fly made us feel rich, even if we weren’t.  

It’s so interesting, because I vividly remember conversations about prison reform, voter rights, overhauling the education system—the list goes on and on. But a candid conversation about money? Never. 

As a graduate student in Michigan, my world expanded. Hearing my friends talk about their trips out of the country made me envious. I had never been to a foreign country.  

When I got my first job after graduate school making a whopping $70,000 a year, I felt rich. But a shopping splurge at JC Penney was no longer scratching that itch. I wanted to do whatever was necessary to be legit wealthy. My now-husband and I would spend our Sunday afternoons driving around neighborhoods in Michigan, oohing and aahing over the grand houses. 

I think that’s why one of the many Oprah Winfrey episodes I watched during the 2000s really stood out to me. The special guest was Suze Orman—an American financial advisor and writer with the most perfect teeth I’ve ever seen. So she’s on Oprah talking about 401Ks and I pick up the basic gist: Save a little money now, you have a lot of money in the future.  Great—right—this sounded amazing—so I got all inspired and set out to meet a wealth advisor that I found on the internet. 

I felt that this random person would unlock some magical room and provide all the answers I needed to become wealthy; get the big house backed up against the lack, fancy cars and luxurious vacations. I was so excited … until I wasn’t. 

Immediately the nondescript building in the strip mall in East Lansing, did not boost my confidence that this was how the wealthy managed their affairs.  

I was placed into a small white waiting room. 

A man who couldn’t even bother to learn the correct pronunciation of my name asked me about my goals for the future. I had a response for that. With excitement, I boldly stated

  1. to retire comfortably by age 60, and
  2. to  support my momma.

His response? “I don’t know why taking care of your mom is your responsibility.” Then, he proceeded to ramble on in financial jargon I didn’t understand. 

I was so taken aback I decided to only share the bare minimum for the rest of the meeting. The whole interaction made me question everything. 

Maybe wealth wasn’t actually for me? Was I reaching for too much? 

I couldn’t figure out why this felt more like an adulthood test I was failing than a dream I was seeding. 

Which is why it’s kind of funny, or maybe serendipitous, that I think about money and wealth all the time now. 

For the last decade I have led an organization in Jackson, Miss., that takes a radically community driven approach to addressing the needs of families—mainly Black women—living in federally subsidized affordable housing. Our programs are holistic and super strategic. But a few years ago, we started to worry that we really were not moving the needle on poverty. So, we started asking the women in our program, “What are we missing?”  

The answers were all different, but the underlying problem was the same. The problem was a lack of cash—a few dollars for pizza on Friday night with the kids, an unexpected car repair leading to unemployment, school fees pushing the dreams of higher education further and further away. I began researching how to distribute cash, not another program, to those living in poverty. 

And in 2018, we launched the Magnolia Mother’s Trust, the United States’ first modern-day guaranteed income program and the first in the world to focus solely on low-income Black mothers. 

Quickly, for the uninitiated: Guaranteed income is a set amount of money people can rely on over a period of time; usually issued by the government or a private funder. And recipients can use the money without restrictions.

It’s not a new idea—Johnnie Tillman, a mom and welfare activist called for a guaranteed income stating moms needed to be compensated for the work of raising their children in 1972. And Dr. Martin Luther King, Jr., and even Richard Nixon were talking about it decades ago as a way to lift families out of poverty. But we’re pioneers in the modern era. And it’s working. 

We give Black mothers  $1000 a month for 12 months. Today, the Magnolia Mothers’ Trust is the longest running guaranteed income project in the country at five years. 

Our goal is simple: Provide the financial capital necessary for these mothers to dream a little bigger and breathe a little easier. 

We’ve learned that $12,000 is a life altering amount of money. Yes it allows you to address the practical needs of life—like paying the science fair registration fees, or getting your car fixed so you can travel to and from work, but it also allows you to shift your reality

Literally, shift your reality…

From scarcity to abundance.

From tunneling to imagination. 

From scraping by to genuine opportunity. 

The problem was a lack of cash—a few dollars for pizza on Friday night with the kids, an unexpected car repair leading to unemployment, school fees pushing the dreams of higher education further and further away.

There are currently over 100 guaranteed income projects in this country, many of them inspired by what we piloted in Jackson, Mississippi of all places. Black women have created a movement … and it is beautiful. 

But it’s only the first step. 

Over the last few years, as I have watched more mothers move towards income stability, as I have listened to them dream about a future free of stress, I have begun to see them dream about wealth. 

Of course, I know the most basic concept of wealth is what you own minus what you owe. I know that in this country we have long defined wealth as owning your own home, having fancy cars, one-upping your neighbor in a never-ending race up the economic ladder.

But for many women—particularly women of color who do not own assets or can make a living wage because of pay inequity—this definition of wealth is inadequate or meaningless. Black women make 61 percent of what white men make, and our country’s economic system has historically excluded people of color through practices like redlining and discriminatory policies, which has led us to the current reality. 

Lord knows we must close the racial wealth gap—it’s going to take all of us and a real reinvention of big systems in this country. But in the meantime, people should not be gaslit into believing that their definition of wealth is any less important or valid. 

bell hooks once wrote, “Definitions are vital starting points for the imagination. What we cannot imagine cannot come into being.”

I asked Coco, one of the women in the Magnolia Mother’s Trust, “What is wealth to you?” 

Without skipping a beat, she said: “If something happened to me, my family would have the money needed to cover my burial expenses.” 

Asking other moms this same question, I have learned moms dream about dignifying funerals, the privilege of privacy, completing school, business ownership and the thrill of being extravagant aunties.  

All of these examples are wealth to them.

They collectively define wealth as a sense of agency, a sense of freedom, the ability to care for their people in a way that honors the depth of their loyalty and love. Wealth to them is about the well-being of the collective, not some pathologically individual pursuit.

For too long, we have defined wealth—and the process of building it—on the terms of the financial institutions. I have never had a mom tell me wealth is having stocks and bonds, equity in their home, or a retirement account. 

Instead, they dream about what a life of ease and care would provide. 

Case in point: One time I asked a mom I work with if she had six months in savings to help with an emergency. She started laughing and told me that before the Magnolia Mother’s Trust she didn’t have one month’s worth of savings. 

She couldn’t even begin to see herself in that equation. 

But when I asked this same mom how she defined wealth, she said all her bills paid every month with a little left for savings. She knew exactly what she wanted; our narrow definition simply didn’t match her needs. 

This response made me finally start listening—we can redefine wealth; and the way this is accomplished is first by listening to others and then by being brave enough to listen to ourselves. 

Moms dream about dignifying funerals, the privilege of privacy, completing school, business ownership and the thrill of being extravagant aunties.  

As I have listened to the women be bold as they define wealth for themselves, I have finally found my voice and learned to define wealth for myself as well. 

When I first asked myself, “What is wealth?” I started crying. I realized that for 20 years, I have been holding on to a definition of wealth that wasn’t written for me, nor does it mirror my desires. I never wanted those big houses perched on the edge of the lake. I wanted what they symbolized in my young mind: the ability to gather those I love, spoil them, nourish our whole crew so we can be ready to go out in the world and do good work for others. 

Don’t get me twisted: I’m not saying that all women experiencing poverty need space to dream. Don’t walk away with that. They need money. But what I am saying is that the mix of basic cash and the space to dream can lead to transformation. It can lead to true wealth. 

It’s my belief that we are made less wealthy by virtue of tolerating a country where anyone must prove themselves worthy. We may have 500 different definitions of wealth in this room, but one thing we can all agree on is that we are all degraded by normalizing immoral inequity.  

I have finally accomplished what I set out to accomplish all those years ago, I am emboldened and empowered to manage my newfound riches. And when I say riches, I don’t mean cash. I mean getting to be the woman I most aspire to be: a loving daughter, a momma who takes her boys on vacations, and you best believe, an extravagant auntie.

We have a poverty of imagination about what makes us truly wealthy. I mean “the things people say about you at your funeral” rich. I mean legacy.

And from where I sit, I really think we can give everyone that kind of wealth. And yes, I will play on the word here—we can guarantee it. If we are willing to understand, a little financial investment can change someone’s life, and allow them the flexibility, heart and mind to build and define true wealth—equity, delight, honor and love. 

Front and Center is a groundbreaking Ms. series that offers first-person accounts of Black mothers living in Jackson, Miss., receiving a guaranteed income. Explore the series here.

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Aisha Nyandoro is the chief executive officer of Springboard to Opportunities.