Career Ladder Identifier and Financial Forecaster (CLIFF)
Some working families experience financial barriers to economic mobility. One significant barrier occurs when career advancement puts a family above the income eligibility threshold for public assistance programs. Due to the gradual or sudden loss of these programs, career advancement opportunities can result in the family being financially worse off (a benefits cliff) or no better off (a benefits plateau) than before the wage increase.
This loss of means-tested public assistance is an effective marginal tax rate on income gains. High effective marginal tax rates mean that some workers have a financial disincentive to invest in their own human capital and advance from lower-wage work to jobs that lead to economic self-sufficiency.
Federal Reserve Bank of Atlanta Tools
The complexity of public assistance programs means that many workers may struggle to understand the timing and magnitude of benefits loss. Coupled with economic insecurity, this uncertainty can prevent individuals from actively seeking opportunities for career advancement. Further, individuals who do advance without knowledge of when assistance will end can find themselves in situations where their standard of living doesn't improve, or even declines.
The Federal Reserve Bank of Atlanta has developed four tools designed to provide information about how benefits change with income gains.
The CLIFF Dashboard is an informational dashboard that shows how public assistance losses intersect with local in-demand career paths. The dashboard shows the financial tradeoffs associated with career advancement and the net gains to the taxpayer when workers advance. For some of our partners, it also simulates policy and programmatic solutions.
The CLIFF Planner is a career path planner and budgeting tool that shows how public assistance losses intersect with local in-demand career paths. The planner allows the user to compare career choices and provide individualized results in more detail than with the CLIFF Dashboard. It also allows the user to create a budget that will mitigate financial barriers to career advancement.
CLIFF Guaranteed Income (GI) Dashboard
The CLIFF GI Dashboard shows the effect that receiving guaranteed income has on the receipt of public assistance. The dashboard is being used to inform prospective participants in guaranteed-income (GI) pilot programs about the possible implications of a guaranteed income on their eligibility for social safety net programs so they can make an informed decision about whether to enroll in a GI pilot. The dashboard is also helping GI pilot program designers create their programs and negotiate income-disregard waivers for government assistance programs in their areas.
Policy Rules Database (PRD) Dashboard
The Policy Rules Database (PRD) Dashboard is a simple-to-use visualization tool that shows how all existing public assistance programs and tax credits come together to support any type of family in any location in the United States.
The PRD Dashboard shows how the dollar value and composition of public assistance changes with increases in income. It can be used to identify when wage gains make a family worse off or no better off financially than they were before the wage increase. Using dropdown menus, users can select any public assistance program, location, and family type and visualize how benefits value changes with income.
Visit the Community and Institutional Partnerships page to learn more about our tools and see how Atlanta Fed partners are using them.
Contact us at email@example.com if you are interested in partnering with us to use any of the CLIFF tools.