The Key to Building Assets with an Individual Development Accounts IDAs:

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IDA for EducationProgram
Jackie E. Goff, MPA Program Coordinator
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Asset Building Through an IDA

• I stands for Individual
• D stands for Development
• A stands for Account

A matched savings account

• Provides money management training
• Helps you pay for College

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Matched Saving Account

• For every 1 you save, receive 4 in matched
  funds
• Save up to 1,000, earn up to 4,000 in matched
  funds

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Do The Math
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Money Management

• 10 hours of free workshops on
• Budgeting
• Saving and goal setting
• Credit building and repair
• Held on evenings and weekends
• This remains the same as Housing

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Saving for your Goal

• Open a free IDA account, with one of our
  partnering agencies
• Save an average of 25 per month
• Save every month for 1-2 years
• Enrollment in an automatic deposit service is
  encouraged

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ZERO Risk With An IDA Account

• The savings are always the participants No
  penalties for exiting the program
• Emergencies allowed

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Investing in Education
Those with a postsecondary education earn on
average 23,000 extra a year.
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Investing in Education

• 23,000 x 2 years 46,000
• 23,000 x 5 years 115,000
• And thats extra
• That can break the cycle of poverty!

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Investing in Education

• Use money for post-secondary education for
  themselves, their spouse or their dependents.
• Eligible schools include Accredited
• Proprietary Schools
• Community College
• University and graduate school
• Start spending money after 45 days

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EducationIDA can be used for

• No
• Room Board
• Student loans
• Electronics
• Car/transportation
• Parking
• Supplies
• Equipment

Yes Tuition Fees Books
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IDA Savings Period An Example
Toni starts saving in August 2009 She saves 100
per month.
September 2010
August 2009
January 2010
September 2010
5 months
Toni begins saving 100 per month
Toni has saved 500 and earned 2,000. She can
now pay for her school expenses at a vocational
school
Toni has spent all 5,000 of her IDA money on
school and is on the way to her degree!
Toni has transferred to SU. She now spends IDA
funds every semester for tuition, fees and books.
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Who Qualifies?

• Families that meet the eligibility criteria of
  the program.
• Participants must have some source of earned
  income.
• Participants must have at least one minor
  dependent child living in the home.
• Participants must not have net worth exceeding
  10,000 and.

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Meet IDA Income Limits-2009
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Gobbledegook?

• One of the factors that need to be taken into
  account when considering communication is ability
  of the human brain to create meaning where,
  perhaps, none exists. Sometimes this is a block
  to communication, but it can also be a great
  benefit as this exercise will show. Simply
  display or hand out the following passage and see
  how difficult or easy it is for people to read.

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Gobbledegook?

• Aoccdrnig to rscheearch at Cmabrigde Uinervtisy,
  it deosn't mttaer in waht oredr the ltteers in a
  wrod are, the olny iprmoetnt tihng is taht the
  frist and lsat ltteer be at the rghit pclae. The
  rset can be a ttoal mses and you can sitll raed
  it wouthit porbelm. Tihs is bcuseae the huamn
  mnid deos not raed ervey lteter by istlef, but
  the wrod as a wlohe.

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Process
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Submit Application

• Complete application and submit to IDA program
• Provide supplemental information (ID, social
  security card, last 2 pay stubs, prior year tax
  forms, IRS Form 4506T, Employer Income
  Verification Form)
• Submit release of information forms
• Sign Participant Agreement

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Process
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Verify Eligibility

• Request information from IRS and match tax
  information to application data
• Request employer income verification
• Issue acceptance/denial letter

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Process
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Orientation/ Training

• Explain program policy and procedure
• Complete release of information, complete
  orientation
• Schedule participant for financial education (10
  hours)
• Secure certificates documenting financial
  education training
• Open savings account and begin saving 2 weeks
  after orientation

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Professional Readiness Education Plan

• Attend PREP training (4 hours)
• Develop PREP plan and submit to IDA
  representative
• Apply to post secondary institution, register for
  classes and receive fee bill

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Process
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Meet Savings Goal

• Establish IDA Custodial Savings Account
• Participant/ bank provides monthly copies of
  savings statement
• Participant saves at least 250 and complete at
  least 45 days within program

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Process
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Participant Request Funds

• Participant is accepted into a school
• Participant submit a Request of Funds form to the
  LA asset building program representative 14-30
  days in advance of need for funding.

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Process
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IDA Pays Fees

• Verify documentation
• Process request for education IDA funds release
• Send letter to vendor with requirements for
  disbursal of funds

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Community Partners

• IDA Contracted Community Partners

General Service Partners
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General Service Partners

• Market the program by including program
  information in newsletters, press releases and
  other marketing materials.
• Refer participants into the program.

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General Service Partners

• Churches
• High Schools
• YMCA/YWCA
• Nonprofit Organizations
• Grocery Stores

• Local businesses
• Beauty/Barber Shops
• Nail Salons
• Beauty Supply Shops

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IDA Contracted Community Partners

• Market the program by including program
  information in newsletters, press releases and
  other marketing materials.
• Recruit/refer participants into the program.
• And

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IDA Contracted Community Partners contd

• Conduct Financial Education Seminars using
  approved curriculum.
• Assist with participants Professional Readiness
  Education Plan (PREP) development
• Facilitate scheduling for pilot
• Eventually providing the training

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IDA Contracted Community Partners contd

• Track participants progress toward meeting their
  asset goals.
• Assist participants in opening IDA savings
  account.
• Provide documentation of participants successful
  completion of Financial Education Training and
  PREP Plan through certificates

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IDA Contracted Community Partners contd

• Assist program in enrolling students into
  approved schools
• Follow-up with participants at 6 month and 12
  month intervals after completion of educational
  program and receive progress reports from
  participants

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Same Forms

• Savings Plan
• Monthly Estimates of Income and Expenses
• Open IDA Savings Account
• Release of Information
• Termination Policy
• Participant Release of Liability
• Consent Form

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Payment

• Agencies can receive 300 per participant for
  which they
• Recruit or receive referral
• Provide 10 hrs of Financial Education
• Assist in scheduling the PREP Training
  (eventually provide)
• Assist participant in meeting asset goal
• Assist participant in enrolling in school

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Getting the word out

• There is an old adage that goes
• If you are sitting behind your desk who is
  working in the community?

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Who are we targeting

• Persons who are in the families that meet the
  eligibility criteria of the program.
• Yes, the IDA can be available for use by any
  member of an eligible household. However, there
  is a limit of just one active IDA per household
  at a time.

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How many education IDAs can be offer to a
household over a life time?

• Conceivably, all children in an eligible
  household could utilize the IDA... but one at a
  time. Time will tell on how this will work.

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Marketing

• Flyers
• Brochures
• E-mail
• Newspaper Articles
• Newsletter Articles

• TV Broadcasts
• Radio Ads
• Radio Talk Shows
• Internet Venues
• Concerts
• Community Events

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In less than 2 months

• 15 application from persons who meet the
  eligibility criteria have been received.

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Remember we are in our pilot phase BUT It only
takes a spark, to get a fire going. And soon all
those around, can warm up from it - it's glowing.

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Question and Answers
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For additional information contact

• Contact
• Jackie Goff
• 225-771-5402
• Jackie_Goff_at_subr.edu
• OR
• Mary Joseph
• 225-771-5454
• Mary_E_Joseph_at_subr.edu