United Way Los Angeles - Hybrid IDAs Increase Savings for Account Holders
The United Way Los Angeles, a long-time AFI grantee, has developed the Hybrid IDA, which provides an additional incentive for participants to make regular deposits into their IDAs. Where traditional IDAs only provide match funds and limited interest on savings, participants who save in the special Hybrid IDAs receive additional interest payments at rates of 15% to 19%. The United Way launched a pilot of this approach in 2007, with support of Citibank. Results of the pilot are impressive: Hybrid IDA participants saved 28% more money during the pilot period ($765 on average) than those who were saving in regular IDAs and they were more likely to make regular deposits. Download the AFI Resource Center article, Holding on to the Dream.
This article originally ran in the IDAresources.org Update Newsletter on 03/04/10 and is available for archival purposes.