Individual Development Accounts (IDAs)

What is an individual development account (IDA)?

How does an IDA work?

Am I eligible?

What benefits will I get?

How do I apply?

Useful links

What is an individual development account (IDA)?

An individual development account (IDA) is a special matched savings account to help low-income people put money aside for homeownership, education, or a small business.

For every dollar you deposit in your IDA account, the IDA program puts in one or more matching dollars. Your savings double or triple (or even more) with the matching IDA deposits.

How does an IDA work?

An IDA account is a matched savings account. For every dollar you deposit, the IDA puts one or more matching dollars in your account.

The amount of matching money you get depends on your IDA's match rate. Many IDAs have a 3 to 1 match, but some are higher and some are lower.

If your IDA program offers a 3 to1 savings match, you get three extra dollars for each dollar you save. If you deposit $50 per month, for example, you get another $150 deposited in your account, for a total of $200. There is a limit on the amount of deposits that will be matched.

Not all IDA programs are the same. IDAs vary in the match rate they offer, the length of the program, the amount of savings that can be matched, and the way the money can be used. Massachusetts IDAs can be used to buy a house, pay for education, or start a small business.

Most IDAs require that you stay with the program for a certain amount of time in order to get the match. An IDA program can last one year or as long as five years. If you take out your money before the end of the program, you may lose the matching funds. Your IDA program will help you set up a savings goal and deposit schedule.

Am I eligible?

IDA programs vary in their requirements. Generally, to be eligible:

• You must have limited income and assets 
• You must be working
• You must be motivated to save some of your earnings
• You must be willing to attend money management classes
• You must live in the program's service area

What benefits will I get?

Benefits vary depending on the IDA program.

All IDA programs match savings. The match rates differ from one program to another. Most programs offer a 2-to-1 or a 3-to-1 match. Some match rates are as high as 4 to 1.

In addition, IDA programs usually offer one or more of the following:

• Financial education classes to help you with budgeting, saving, and banking
• Home-buying classes
• One-on-one counseling
• Small business classes
• Savings clubs
• Case management

How do I apply?

To apply for an IDA program, you should contact your local IDA sponsor. For programs in Massachusetts, see:

• 2008 IDA Service Provider Listing (PDF) from the Office of Housing and Economic Development
• IDA Programs in Massachusetts on the Corporation for Enterprise Development (CFED) web site

Useful links

These links are external links to web sites that are not part of MassResources.org. When you click on these links, you will leave our site. Click "Back" on your browser to return.

1. Individual Development Account (IDA)
   Description of the Massachusetts IDA program, participating agencies, target populations, and eligibility. From the Massachusetts Office of Housing and Economic Development.

2. Individual Development Accounts (IDAs)
   Basic information about IDAs, including answers to frequently asked questions. From the Corporation for Enterprise Development (CFED).

Individual Development Account (IDA) section last updated on 4/15/10