Matched Savings: Building Wealth and Economic Mobility
The Matched Savings Coalition leads the advocacy efforts for MA’s Matched Savings Bill
Co-led by United Way of Massachusetts Bay and The Midas Collaborative, the coalition brings together advocates, practitioners, and those with lived experience to advocate for the Matched Savings Bill, SB.628; HB.1023, which allows participants to save up to $20,000 with a 4:1 match. Matched Savings empowers participants to be financially independent.
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What is matched savings?
Matched Savings, also known as Individual Development Accounts (IDAs) is a type of asset-development program.
More well-known anti-poverty programs like SNAP and TANF focus on stabilizing income to meet current or short-term needs, while asset development programs are future-focused to help participants to experience upward economic mobility, strengthen financial security and build wealth over time.
Examples of assets are endless. They include bank savings accounts, which is the focus of this bill. But assets also include financial investments (e.g., stocks, bonds and mutual funds), real estate, personal property (e.g., a car), retirement account (e.g., 401Ks) and pensions. From an anti-poverty lens, the idea is that by accumulating and having assets, individuals will have sufficient money to pay off their debts.
Assets are more than an accounting term. For many people, it gives a feeling of being secure. Assets give people peace of mind.
What is the bill?
Sponsored by Senator Eldridge and Representative Gentile, SB.628; HB.1023, will create a state funded matched savings program.
The bill will fund 2,400 accounts which will be available to people who are below 80% area median income. Participants will be entered into a program where they will be able to save up to $20,000 dollars. Contributions are matched 4:1, that’s $4,000 personal contribution and $16,000 state contribution.
The cornerstone of the bill is that it empowers participants to make their own financial decisions. After graduating, participants can use their savings on a wide range of wealth building activities, including, a down payment on a home, higher education for themselves or a dependent, and purchasing a car or other forms of transportation.
Additionally, participants will be enrolled in financial coaching sessions while in the program; giving participants the skills and financial know how to continue saving post graduation.
Both bills had been assigned to the Joint Committee on Financial Services and had a hearing on October 24th. In February, both bills were granted an extension until May. Unfortunately, the Matched Savings bill was not reported out favorable and have been sent to Third Reading; effectively ending the possibility that it will be passed this legislative session. We will be seeking to refile the bill in the upcoming 2025 - 2026 legislative session. Sign-up for advocacy alerts below to get a notification for advocacy you can participate in next year.
