Economic Opportunities Program

Credit Path

This research project was undertaken to refine a conceptual framework known as the "Credit Path®," which identified four stages people pass through on their way to asset accumulation and greater financial security: transactor (where individuals rely primarily on a cash economy), saver, borrower and owner.

First developed in 1995 by William Myers, CEO of Alternatives Federal Credit Union of Ithaca, N.Y., the Credit Path® was used by Alternatives and other financial institutions as a tool to design new products and services that would help people move along a path toward greater financial security.

Given recent sweeping changes in the financial services industry, this research project focused on whether the Credit Path®, as originally conceived, still realistically represented credit union members' financial lives.

With funding from the Annie E. Casey Foundation, Alternatives worked with Aspen/EOP, New England Market Research and independent consultant Cathie Mahon to better understand the pathway people follow today. Their work culminated in a report entitled, "Toward a New Credit Path®." (See below for details.)

Funder: Annie E. Casey Foundation

Research product:

"Toward a New Credit Path®" Full report or overview
December 2006

This report takes a fresh look at the "Credit Path®" concept, first developed in 1995 by Alternatives Federal Credit Union CEO William Myers. As originally formulated, the Credit Path® assumed that people grow and accumulate assets by sequentially following a pathway consisting of financial stages: transactor (where individuals rely primarily on a cash economy), saver, borrower and owner. However, this study, a collaboration between Alternatives, Aspen/EOP, New England Market Research and independent consultant Cathie Mahon, found that people often hopscotch among stages—and sometimes can be in two stages or more simultaneously. The research involved surveying more than 900 Alternatives credit union members about their financial lives, behaviors and attitudes toward finances.