Institutions and savings in low-income households

Abstract

This paper examines the influence of structured savings program arrangements on the saving performance of low-income households in individual development accounts (IDAs). Data are drawn from the American Dream Demonstration (1997-2004), which looked at the saving performance of low-income households in matched savings accounts across the United States. Hierarchical multivariate regression is used to identify which specific structural program arrangements are important in influencing the saving performance of low-income families. Findings suggest that overall, structured program arrangements, including financial education, peer mentoring groups and saving targets are important in influencing people's saving performance-including low-income families.