The tax deadline has passed and you are waiting to receive your income tax refund. You have probably thought of 101 ways to spend the incoming cash. (That new iPad is finally within reach, huh?) Let me provide an alternative option. What if I told you there was a government-run program that rewarded you for saving, would you believe me? Well it does exist – Save USA!
Started in 2011, Save USA is a program created by New York City’s own, Mayor Mike Bloomberg. (This should be better received than his soda ban. haha) The program aims to encourage low-income New Yorkers to save their tax refunds in a savings account versus spending it. The program requires participants to save at least $200 and you will receive an additional $0.50 cents per dollar! (Who doesn’t like free money?) Save $1,000 and receive the maximum $500 match! What’s the catch? You have to be a committed saver and don’t touch the money for a full year. (But as a reader of this blog I am sure you are a long term saver, so that minor stipulation doesn’t affect you. *ahem*) Sadly, only 70% of participants in 2012 successfully saved for the entire year to receive the account bonus.
Bad news: the program is officially closed for 2013. But get a jumpstart and be ready for 2014! Good news: the program is also available in Newark, NJ and a couple of others cities nationwide.
We at D.R.E.A.M. really love this initiative as it aligns with our core values. The program takes aim at the cycle of poverty that is rampant in low income urban neighborhoods. The program encourages saving, a building block for a solid financial future. This program, in and of itself, is not the solution but it’s a great first step. We encourage everyone that is eligible to participate. Here are the criteria to qualify:
- Earn $50,000 or less if you have children
- Earn $18,000 or less if you do not have children
- Have a minimum refund of $200 and agree to save at least $200 in the account
- Be 18 years of age or older
- Provide two forms of identification and proof of address in addition to your tax documents
- Open the account at the time you file your taxes if you are assigned to a SaveUSA account
Check out the video below produced by Brian Epstein and PBS. It features New York City Deputy Mayor for Health and Human Services, Linda Gibbs, as she explains the benefits and desired outcome of the program. Also visit the Save USA site for additional information.
About the Author: Femi Faoye is the Co-Founder and Chief Executive Officer of D.R.E.A.M. He’s a staunch and passionate financial literacy education advocate.
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