The U.S. Department of Health and Human Services is giving just over 342-thousand dollars to the Iowa Credit Union Foundation for a program to help low-income families save. Foundation executive director, Marybeth Foster, says the families are given what’s called an "Individual Development Account."
Foster says it’s a matched savings account, so for every dollar they save, the money is matched by the program. Foster says the family has to save the money with a goal. Foster says the idea is to save toward a long-term purchase, so they could use the money as a down payment on a home, to start a small business, or for education and job training.
Foster says saving money is just part of the program. The program also requires the family to undergo some type of financial education, so they learn how to save, how to budget and how to deal with credit and debt issues. Foster says most programs require people to save money for six months so they build the habit of saving money, and don’t just put the money into the account and then take it out.
Foster says the program has been successful in other states. She says it’s targeted toward low and moderate income families which are often thought to have a hard time saving, but says this program shows they can save if they have a goal. The federal money matches donations the Iowa Credit Union Foundation has raised to start the program. Twelve credit unions were selected by the foundation’s IDA committee in late March to pilot the program, which will launch summer 2008.
Foster says interested families should check with their local credit union to find out more about the program. The following credit unions are a part of the pilot group: ACE Community Credit Union, Ames;Affinity Credit Union, Des Moines; Ascentra Credit Union, Bettendorf, Davenport, Muscatine;Cedar Falls Community Credit Union, Cedar Falls; Community 1st Credit Union, Ottumwa and other branches; Dupaco Community Credit Union, Dubuque; DuTrac Community Credit Union, Dubuque, Maquoketa, Eldridge, Davenport; Employees Credit Union, Estherville; Family Community Credit Union, Charles City; Linn Area Credit Union, Cedar Rapids; Marine Credit Union, Decorah;Veridian Credit Union, Waterloo. http://