Community Action Agency of Southern New Mexico (CAASNM) has received a $15,000 donation from First American Bank. The generous donation will be used to fund eight Individual Development Accounts (IDAs) for low-income households through a partnership with Prosperity Works, the New Mexico Assets Consortium and Assets for Independence.
IDAs are special, custodial savings accounts where participants receive a combination of federal and non-federal funding that can be used to purchase a home, start or expand a business, or pursue post-secondary education. Dawn Z. Hommer CAASNM’s CEO explains, “The unique aspects of this life-changing, anti-poverty program are that the clients must reach a set savings goal, create and maintain a budget, enroll in financial literacy classes and receive asset specific training to encourage fiscal responsibility before they have access to the funding.” CAASNM then provides an 8-to-1 match to the participants’ savings accounts which gives them a total of $4,500 to purchase their selected assets.
Rodolfo Acosta-Pérez, CAASNM’s Director of Family Empowerment, said that “IDAs prove that community-based organizations and financial institutions can work together to connect low-income people to affordable and safe financial products and services. IDAs are tied to financial literacy and are an evidence-based approach to economic development.” According to the Corporation for Enterprise Development (CFED), each dollar invested in IDAs translates into a return of 5 dollars to a state’s economy in the form of increased mortgage holdings, more jobs, increased construction, higher educational attainment, and reduced government assistance expenditures
In addition to helping families purchase life-changing assets, IDAs help to combat the state’s problem of unbanked households. According to a 2012 FDIC national survey, 11.5% of households in New Mexico were “unbanked”, meaning that they had not established either a checking or saving account. IDA’s are also a proven method to help raise low-income families out of poverty.
Russell Foddrill, Market President for First American Bank’s Chaparral facility, states that “We believe these funds are an important part of First American Bank’s commitment to reach out to customers in under-served areas. Hopefully, we can assist them to find more cost-efficient methods for dealing with their personal finances than the higher cost alternatives many of them currently use.”
For more information, visit: www.caasnm.org
CAASNM is a non-profit dedicated to building self-reliance for low-income New Mexicans by connecting our community to high-impact programs that encourage family wellness, empower families and bridge resources. CAASNM has served the community for 50 years with high-impact programs to move people out of poverty and build self-sufficiency. Its purpose is to be a voice for underrepresented populations, mobilize communities, advocate for the poor, and work with the community to better the resources and lives of the people who live in it. CAASNM is an active partner with dozens of businesses and other agencies in its service area that work to improve the quality of life for the community. CAASNM also serves as a catalyst for change by helping new programs launch and sustain themselves. Focus areas are Family Empowerment, Bridging Resources, Family Wellness and Community Connections.
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