Account holders also get training in personal finance and connect with other savers in peer groups. Many of them have never even had a bank account before. The Corporation for Enterprise Development , a nonprofit organization in Washington, D.C., is spearheading Downpayments on the American Dream in a dozen metropolitan and rural areas around the country. Altogether, there are approximately 200 IDA programs nationwide, most of them launched in the last three or four years, according to the development group. The savings are typically earmarked for home purchases, business start-ups and education or job training.
Participants can withdraw their own money for other reasons, but they lose the match if they do so.
Though still considered experimental, IDAs have caught the attention of political leaders in Washington. During his State of the Union address, President Clinton pointed to the IDA movement in calling for a national system of matched savings. I propose to match their contributions, however small, dollar for dollar, every year. The president's plan would allow higher-income families to receive a smaller match on their savings. Other proposals to provide federal money for matching contributions by local institutions have received bipartisan support in Congress.