Financial and Educational Asset Building
92 percent of Greater Boston communities were considered affordable in 1998 and 37 percent in 2003. In 2004, only 17 percent were affordable.1
Building Assets
Did you also know that people earning the minimum wage must work 153 hours per week in order to afford the average monthly rent of $1460 for a two-bedroom apartment in Boston ? For many working poor families and individuals, the American Dream is not accessible. Opportunities to better themselves, own a house or start a business simply do not exist.
A core strategy of United Way of Massachusetts Bay (UWMB) is ”asset building.” It is the investment in policies and programs that move working-poor individuals and families into the economic mainstream, and help provide the opportunities and resources that will get these families started on the path to economic security. Individual Development Accounts (IDA) is one such program that helps working poor individuals and families get ahead by helping them create savings and “build assets” (such as higher education) and financial literacy.
IDAs are only offered through nonprofit or government organizations and can only be used to purchase a first home, pay for post secondary education or capitalize a business. To qualify, individuals must have a job and go through intensive financial education and other types of relevant training, such as homebuyer education, credit counseling or principles of entrepreneurship.
With our partners, UWMB offers a $2 for $1 match for IDA accounts. Due to the high cost of housing in the Greater Boston metropolitan region, we offer a $4 for $1 match for those first time buyers looking to purchase a home.
What is the benefit to you? Every year working poor individuals and families qualify for substantial governmental subsidies. For example, someone earning $20,000 a year has only to pay 30% of housing costs, with the remaining being subsidized by taxpayer money. By moving these people into the economic mainstream through an IDA program, their earning potential will be greater (due to their investment in education), rent is no longer subsidized at the expense of the taxpayer (due to home ownership) and you give another individual (or family) hope and opportunity.
1The Greater Boston Housing Report Card 2004.