CARTOONS BY CHRIS BRITT

or credit union, which handles the financial side of the IDA. Each month, you receive a
report telling you how much money is in your IDA, including the money you put in, any
matching amounts and interest. You can withdraw money as soon as you reach a specific
saving goal but you must first get approval from the IDA program sponsor. The goal can
be for something major, such as a home or a business, or something smaller, such as
college tuition and textbooks.
ADVANTAGES
Range of services. In addition to a savings account, you can access other programs
related to starting and managing a business, such as classes on managing cash flow and
preparing tax returns.
Match rates. IDA programs match each dollar you save with additional funds from
donors. Many programs offer a 1:1 match rate, which means that for each $1 you deposit
in your IDA, $1 in matching funds will be added to your savings. Depending on the
program, though, match rates can be more or less. For example, the Mercy Corps NW IDA
match savings program operates on an 8:1 match ratio. This means that every dollar you
save in your IDA, they will match it with $8 in additional grant monies.
Reasonable savings period. The savings period will vary from program to program, but
most savings periods range from 1 to 3 years. This period indicates the length of time
your savings will be matched.
Uses of match dollars. Most IDAs allow you to use the savings to buy a home, pay for
education or job training or start a small business. But programs vary, as do what they
allow you to use the money for. Be sure that you know all of the uses that each program
allows before enrolling.
DISADVANTAGES
Limits to the amount of match. Some programs will only match up to a certain dollar
amount (for example, $500) on an annual basis or during the course of the program.
In most cases, you can deposit as much as you like in your account, but savings over the
limit will not receive matching dollars.
Class attendance is mandatory. Most programs require you to attend a certain number of
classes so that you can learn more about setting and managing household budgets, using
credit responsibly, the basics of saving and investing, etc.
Different rules and restrictions. IDAs are not all the same. You will need to spend some
time researching the different programs so you can find the one that is the best match for
you. Different hosts have different rules. For example, some faith-based IDAs may require
regular church attendance as part of the match.
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