Improving Individual Development Accounts after the Loss of Federal Matching Funds: Lessons on Scalability from a Community College Pilot
In 1998, Congress passed the Assets for Independence Act, which made federal dollars available for matched savings programs, called Individual Development Accounts (IDAs). The program was zeroed out in May 2017. The accounts were for eligible low-income households and intended to enable saving and investing, most often toward home ownership, small business, or postsecondary education. In practice, due to cumbersome eligibility and operational requirements and participants' need for intensive support, IDAs never achieved scale. This is despite concerted efforts by dedicated asset builders committed to improving lives in transformative ways. Mostly delivered through nonprofit community-based organizations, IDAs seemed to have potential for achieving scale in community college settings, given the access to a population of potentially eligible participants already investing in an allowable asset—postsecondary education. This brief describes the rationale for offering federally funded IDAs in community college settings and the persistent barriers to scale, drawing on observations of a pilot at three Massachusetts community colleges.