Building Family Economic Success: Individual Development Accounts (IDAs) and Other Savings Tools

IDA Defined

Individual Development Accounts (IDAs) are special accounts that offer low-income individuals a chance to build assets and save for the future. In IDA programs, an account holder deposits money and it’s matched — often at double the value — by private or public funds.

Assets Get Due Attention

Most efforts to combat poverty focus on a family’s current income and their ability to fulfill basic needs, such as securing clothing, housing and food. However, experts are beginning to recognize that another factor — financial assets — is equally important in determining a household’s economic health.

Casey in Action

Three ways that the Foundation is working to help low-income families save and build assets include: 1) promoting policies that support asset development; 2) investing in ways to broaden the range of available asset development strategies; and 3) building an infrastructure that can support an expanded IDA field capable of reaching millions of low-income families.

A Limited Reach

Today’s IDAs serve only a fraction of the millions of families who might benefit from their savings potential. Casey’s advice? Make the accounts simpler and more cost-effective to help expand IDA programs to a grander scale.

The Catch

Individuals can only use their IDA savings for specific purposes, such as buying a home, launching a business or paying for education.

Pervasive Poverty

In America, 40% of white children and 73% of black children grow up in families with zero or negative net financial assets.