Matched Savings Program

September’s Continuing Education gathering brought in Alice Gray, our IDA program coordinator, to explain the requirements and opportunities with regard to opening a Matched Savings account with Foundation Communities. As you may (hopefully) know, the Matched Savings (or IDA) program offers select clients the chance to open a savings account in which every $1 that they deposit will be matched by Foundation Communities with $2. The clients have a chance to put this money toward: 1) starting or expanding a business; 2) buying a home; or 3) paying college expenses. For more details on the process of opening an account and the requirements that the clients need to meet, visit the volunteer resource page, and take a look at our featured resource.

During the gathering, Alice also shared with us the story of one of her clients, Veronica, who used her account to open her very own salon. Before entering the program, Veronica rented a chair in an existing salon, but she was unhappy with the owner, whose behavior was inappropriate enough to scare away customers. She had little say in the reputation of the business, and her clients were disappearing due to problems that were out of her control.

Hoping to leave the unprofessional work environment behind, Veronica secured a lease in a different building and put her matched savings toward some of the overhead costs associated with having her own space. After Veronica attended Foundation Communities’ Money Management classes and took the required business classes, she created a business plan, then used her matched savings to bring it to fruition. Veronica effectively paid for only 33% of the costs involved with:

1)      Having the interior freshly painted

2)      Hiring an electrician to install outlets at each ‘station’

3)      Having a new floor installed

4)      Purchasing 2 brand new barber chairs (her husband works as a barber at the salon!)

5)      Purchasing an “Open Sign”

6)      Paying for a year’s worth of insurance on the building (required by the landlord)

7)      Paying her first month’s Gas bill for the building

Even after these expenses, Veronica still had about $260 of her own savings and $520 in matched funds, leaving a total of $780 left to use for the business. She was able to retain some loyal customers and is now developing marketing materials to draw the crowd to her clean, comfortable salon. With time, we hope to see that removing these start-up costs will help her business become self-sustainable.

Clients such as Veronica are being given the chance to make positive change for their financial future, and need to know the support that is available to get them off the ground. If your client matches the basic requirements and is looking to make progress on one of the three qualified goals, you can inform them of this no-risk option. Help spread the knowledge, and help spread the wealth.