Programs that provide cash to mothers strings-free can strengthen family bonds and increase confidence in parents.
Photo by Enigma_images, courtesy iStockphoto
Lights stay on. Cars get repaired. Evictions are avoided and refrigerators restocked. For the women who receive monthly cash payments through Magnolia Mother's Trust in Jackson, Mississippi, the impact is often seen in crises that never happen.
The program provides $1,000 a month for a full year to mothers who live in the community's subsidized housing, with no requirements or restrictions on how the money is spent.
The guiding principle of the program is simple: “Trust,” said Sarah Stripp, director of socioeconomic well-being for Springboard to Opportunities, the Jackson-based nonprofit that launched Magnolia Mother's Trust in 2018. While many programs require families to navigate bureaucratic hurdles, “this program starts from a different place and removes those obstacles,” she said.
Cash transfer programs have succeeded around the world for decades, improving outcomes in education, mental health, breastfeeding, nutrition, overall health and well-being. In many countries, payments to families are considered routine, and studies show nearly 70% of countries include child allowances as a regular part of their social safety nets.
Data from such programs conducted in the U.S. are equally encouraging. Findings from more than 150 pilot programs and federal initiatives demonstrate that cash transfer programs can reduce poverty, enhance health and boost financial stability without reducing labor force participation. Funds are spent on essential needs, including food, clothing, utilities and transportation. Studies show that larger and longer-running programs yield the greatest benefits.
Despite the mounting evidence showing they work in the U.S. as well as abroad, some critics remain opposed, insisting that recipients must prove they deserve assistance, or that they should somehow fix their circumstances on their own. Such thinking often softens when programs are funded by philanthropy, rather than public funds.
In Jackson, broader debates gave way to something simpler: listening. Springboard to Opportunities devoted its early years to offering after-school programs, workforce training, parenting workshops and education advocacy in its largely subsidized-housing communities. However, repeated feedback from mothers highlighted a critical need: While the classes were helpful, what families truly needed was cash support.
Beginning in 2018 with 20 mothers, Magnolia Mother's Trust has grown to support cohorts of about 100 participants. The program provides not only $1,000 per month for 12 months, but also deposits $1,000 in a college savings account for each child.
To date, more than 550 mothers have completed the program, funded entirely by private philanthropy and managed internally. Early data indicate that families use the funds to pay rent, purchase groceries, repair vehicles and access medical care. Subsequent research points to deeper outcomes: increased parental confidence, stronger family bonds, reduced financial strain and a lasting sense of control over their lives.
Recognized as one of the nation's earliest and most influential no-strings-attached cash transfer programs, Magnolia Mother's Trust challenges long-standing beliefs about who can be trusted with cash.
“Looking at the amount of layering, paternalism, bureaucracy and all of those different pieces that we make people go through to be able to just take care of their families, it certainly seems like the U.S. social safety net is pretty far behind other countries,” Stripp told The Nation's Health.
Lorrine Paradela received monthly payments through a Stockton, California, program, which helped her afford her car.
Photo by Nick Otto, courtesy AFP/Getty Images
For a short time, federal policy moved in that direction with the temporary expansion of the child tax credit during the early part of the COVID-19 pandemic. The program lifted millions of children out of poverty and drove the child poverty rate to historic lows. However, the expansion expired in December 2021 and child poverty rates have since reverted to pre- pandemic levels.
Further illustrating the importance of cash support, new research shows declines in food sufficiency as the U.S. moves to scale back key safety net programs such as the Supplemental Nutrition Assistance Program under the Trump administration.
“Poverty is a fundamental driver of poor health,” said Aaron Richterman, MD, MPH, assistant professor of medicine in the Division of Infectious Diseases at the University of Pennsylvania. “Whatever outcome you're looking at, from a health standpoint it's much worse among lower-income populations and people living in poverty.”
In a study in The Lancet in December, Richterman and other researchers at the University of Pennsylvania Perelman School of Medicine showed that large-scale, government-led cash transfer programs significantly improved health in low- and middle-income countries, increasing rates of early prenatal care, facility births and attended deliveries.
Programs that reached a greater share of the population delivered greater gains, researchers found, including higher rates of breastfeeding, child nutrition and vaccination coverage, and reductions in diarrhea and underweight status.
“Cash transfers have become very popular types of poverty alleviation programs,” Richterman told The Nation's Health. “They're in hundreds of countries — high-income countries, low-income countries — all across the world.”
Some programs impose conditions, requiring recipients to meet certain benchmarks. But imposing barriers increases administrative costs, including costs associated with ensuring compliance. For that reason, unconditional cash transfers are increasingly favored, he said.
“These are no-strings-attached kinds of interventions, and they are popular both because the administrative costs are quite low, but there's also the sense that people ultimately best know what they need to spend the money on,” Richterman said.
Many U.S. anti-poverty initiatives maintain strict eligibility requirements and work mandates, however.
“In practice, the requirements often just have the effect of kicking people off benefits — people who are, in fact, eligible but struggling to demonstrate compliance or navigate the paperwork,” Laura Keen, MPP, U.S. program director for GiveDirectly, a nonprofit that delivers donations directly to people living in poverty, told The Nation's Health.
A Mississippi program provides $1,000 a month for a full year to mothers as well as money for child college savings programs.
Photo by Mediaphotos, courtesy iStockphoto
GiveDirectly launched its U.S. operations in 2017, providing hurricane relief in Puerto Rico and Texas. Since then, the program's U.S. footprint has grown dramatically. To date, it has provided more than $330 million in cash to over half a million people. Worldwide, GiveDirectly has provided more than a billion dollars to over 2 million people.
“We don't see people making reckless choices,” Keen said. “We see people stabilizing their lives.”
GiveDirectly has expanded into targeted initiatives such as Rx Kids in Michigan, a public-private partnership providing no-strings-attached cash to pregnant women and new mothers during what researchers describe as one of the most economically vulnerable periods in a family's life.
The program has been linked to an 18% reduction in preterm births, a 27% decline in low-birthweight babies and a 29% decrease in neonatal intensive care unit admissions, resulting in more than $6 million in health care savings. Researchers attribute the improvements to factors such as increased prenatal care and reduced smoking during pregnancy.
In Georgia, another initiative demonstrates that cash can function as health policy. GiveDirectly partners with the Georgia Resilience and Opportunity Fund, or GRO Fund, to administer “In Her Hands.” The program provides low-income women in urban, suburban and rural communities with recurring, no-strings-attached monthly payments over multiple years. Like Magnolia Mother's Trust in Mississippi, the Georgia program was co-designed with residents and community leaders and emerged from stark economic disparities. The program initially provided $20,400 over two years to about 650 low-income women statewide.
“We saw clearly that participants' financial stability and overall wellness improved,” GRO Fund Executive Director Hope Wollensack, MPA, told The Nation's Health. “In our economy, health and wealth are interdependent. Cash is not charity. It is a practical tool that turns women's expertise about their own lives into better health, stronger families and more resilient communities.”
Participants reported stronger financial indicators, including increased savings and more consistent on-time bill payments. The ability to afford rent and utilities rose while evictions declined.
“The stability made room for longer-term planning and marked improvements in health,” said Wollensack, noting that the program is primarily funded by private philanthropy, major foundations and individual donors.
For more, visit www.thegrofund.org/about-in-her-hands, www.springboardto.org and www.givedirectly.org.
- Copyright The Nation’s Health, American Public Health Association
