Connecticut Department of Labor
  Home About Us FAQ News and Notices Contact Us
Unemployment Benefits On-Line Job Seekers Employers Labor Market Information Directions/Office Information

 

Connecticut Individual Development Account Initiative (IDA)
Frequently Asked Questions


CLICK ON EACH QUESTION TO SHOW THE ANSWER. CLICK ON THE QUESTION AGAIN TO HIDE THE ANSWER.

IDA Gears Logo

1. What is an IDA?
An IDA, or Individual Development Account, is a special matched savings account designed to help families and individuals of modest means establish a pattern of regular saving and, ultimately, purchase a "qualifying asset".

A "qualifying asset" is something of value that is likely to return substantial long-term benefits to its owner, benefits like security, stability and opportunities for more income. 

Participants may use their savings and match money toward one of several assets, which depending on the program -- might include a first home, a small business, a post-secondary education, a vehicle if needed to get or keep a job, or a deposit on an apartment, or post-secondary education for a dependent child.
 
2. What is a "savings match"?
A "savings match" is a commitment to match an IDA participant's savings deposits at a specific rate. The savings in your IDA can be matched $2.00 for every $1.00 that you save, up to a maximum match of $3,000.
 
3. Who is eligible to participate?
IDA Programs are designed to help low-income working families build assets. There is an income eligibility limit for entrance into the program. Income eligibility is determined once, upon entrance into the Program; there is no subsequent re-determination of income eligibility. The eligibility criteria differ with each program, but there is usually an income eligibility limit as well as an asset limit for entrance into the program. There are also other things that the program operator will consider when determining your eligibility for the program like your ability to attend meetings and your willingness to save. IDA Program staff will meet with you to determine if you meet income eligibility and other eligibility requirements.
 
4. What is required of IDA participants?
IDA participants must commit to:
  • Make regular savings deposits (the amounts are determined on an individual basis).

  • Attend a Financial Education Course.

  • Participate in monthly Asset Specific Savings Clubs.

  • Work with a Case Manager on an on-going basis.

 
5. Why would anyone give away money like that?
IDA savings matches are not "giveaways." Participants earn matches by saving their own hard-earned dollars and taking other steps to prepare for the future, like attending Financial Education classes. Furthermore, providing match dollars is a way to help hard-working low-income families and individuals build a more stable and secure future. Everyone benefits when more members of a community have the tools they need -- to provide for themselves and their families. This same thinking has been behind government initiatives like the Homestead Act of the 19th century and the G.I. Bill following World War II.
 
6. Is there more to an IDA Program than just saving matches?
Absolutely! Most people need more than just cash to become successful homeowners, entrepreneurs or college or vocational school students. For this reason, participants in the IDA program attend both Financial Education classes and a special on-going asset preparation program. These workshops are designed to help participants acquire or polish the personal and financial skills that are essential for long-term success; such as skills for long-range planning, household budgeting, credit repair and savvy consumer habits. Participants learn important information that will help them make a wise asset purchase and also protect their asset in the future.
 
7. Where are savings deposited?
Your Case Manager will tell you in which Bank you will open your IDA Account. IDAs will not be assessed any monthly service fees and will be insured by the FDIC for up to $100,000 per account.
 
8. What about making savings withdrawals?
Because IDAs are intended to help people purchase assets, withdrawals for non-asset uses are strongly discouraged. However, some programs allow program participants to withdraw some of their savings for certain emergency situations before they are ready to purchase their chosen asset goal. Such withdrawals would not include savings matches. A participant has to work with their Case Manager to develop a plan to replace the funds withdrawn from their IDA. Of course, participants are always free to close their accounts, withdraw from the program and receive all of their savings and earned interest.
 
9. How do participants receive match funds?
Matching funds will be made available to participants when they are ready to purchase an asset. At that time, a check will be issued directly to the company, institution, or individual furnishing a participant's asset goal (a bank or mortgage company, wholesale supplies or community college, for example). When a participant is saving for post-secondary education for a dependent child, at the time of asset purchase the participant will open a 529 Savings Plan and the IDA savings and matching funds will be deposited in it.
 
10. What if I am unable to complete the Program?
A Participant might decide to withdraw from the Program for several reasons. If a Participant is not able to continue saving or is having difficulties meeting the other requirements of the Program, the Case Manager will help the Participant identify resources or other ways to continue to meet their Program obligations. If, after counseling, the Participant decides to withdraw from the Program, the Participant will be given the money in their IDA and any interest earned. They will not receive any matching funds.
 
11. How can I find out more and apply to participate?
To find the closest IDA program to where you live, go to "IDA Programs in Connecticut". You will find the contact name and information for each program in the state. The person listed will be able to tell you more about the IDA program and what you need to do to apply.


200 Folly Brook Boulevard, Wethersfield, CT 06109 / Phone: 860-263-6000
Home | 
CT.gov Home Send Feedback
State of Connecticut Disclaimer and Privacy Policy. Copyright 2002 - present year