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New Hampshire Community Loan Fund

New Hampshire Statewide Individual Development Account (IDA) Collaborative ____________________________________ Marcy Meyer Director of Asset Development New Hampshire Community Loan Fund (603) 224-6669 mmeyer@communityloanfund.org. New Hampshire Community Loan Fund.

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New Hampshire Community Loan Fund

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  1. New Hampshire StatewideIndividual Development Account (IDA) Collaborative____________________________________Marcy MeyerDirector of Asset DevelopmentNew Hampshire Community Loan Fund(603) 224-6669mmeyer@communityloanfund.org

  2. New Hampshire Community Loan Fund • Non-profit Community Development Financial Institution (CDFI) • Loans, programs and services to promote affordable housing, economic development and community opportunity • Current areas of focus: manufactured housing, small business development, child care, IDAs/matched savings

  3. What is an IDA? • Matched savings account for eligible high return assets • Offered in combination with financial education and asset-related training/counseling – incentivizes participation in training • Targets lower-income individuals/households • Helps income-eligible individuals accumulate savings more quickly to pay for a qualified asset • Can reduce the amount of money borrowed to pay for an asset or provide financing if loans or other resources not available • Promotes financial self-sufficiency and long-term financial opportunity • Encourages savings behavior

  4. NH IDA Program Objectives Help program participants: • Set realistic financial and asset-related goals • Obtain financial skills and knowledge • Obtain asset-related skills and knowledge • Develop or improve regular savings behavior • Acquire assets that promote financial security and opportunity

  5. NH IDA Program Overview • 3:1 match • 300% return on the investment! • Up to $2,000 matched • Up to $6,000 subsidy • Up to $8,000 in total available funds • Eligible Assets: • First-time home purchase • Small business/self-employment development • Vehicle purchase (through More Than Wheels only) • Post-secondary education/training • Home Repair (Coos and Grafton Counties only)

  6. NH IDA Program Requirements • Must fall within income and net worth limits • At least one household member must have a source of earned income • No minimum age requirement • Regular savings required – at least $25/month until matchable savings limit reached • 6 hours of financial fitness/asset training required before application • 10 hours of financial fitness/asset-related training required each year in program • Participants must be in the program for 6 months before IDA match can be accessed

  7. Other Program Information of Interest • Federally-supported IDAs are not counted as an asset for federal aid programs, so will not impact eligibility • Participants can withdraw from the program at any time, taking their personal savings with them • Only interest earned on participant’s personal savings is potentially taxable, whether the IDA is federally-supported or not

  8. NH IDA Program Model Back-room operations managed by the New Hampshire Community Loan Fund Direct services to program participants provided by Community Partners in local communities

  9. How do Education IDAs work? • Student financial aid option • Can reduce student loan and/or work study burden • Can help with the estimated family contribution • Can fill a gap left if a school cannot provide the full Financial Aid Package needed • For adult students, represents an alternative to scholarships • Helps students who cannot access federal financial aid • Helps students from groups traditionally reluctant to take out loans • Can be used for tuition, fees, books, supplies and/or equipment purchased at or through an approved educational institution • Must be used at a post-secondary institution or program eligible under U.S. Department of Education guidelines

  10. General Benefits of Education/Small Business IDAs

  11. Benefits to Post-Secondary Schoolsof Offering Education IDAs • Help schools meet mission of access by promoting access to education for lower-income students • Promote positive recruitment and retention results • IDAs can be used as an outreach tool to attract students • IDA funds make it financially possible to attend school • Planning process means students are prepared • Training provides helpful life skills that contribute to student enrollment/retention success

  12. Education IDAs & Other Student Aid • Personal IDA savings • considered a protected asset by the federal government • per US Department of Education, personal savings in an AFI-eligible IDA is excluded as an asset for eligibility and assistance level determinations in connection with federal aid (not reported on the FAFSA) • Does not negatively impact ability to receive Pell Grants • Schools are encouraged to exclude IDA for state, local or school-funded assistance Continued

  13. Education IDAs & Other Student Aid • IDA Match Funds • Considered an outside resource (like a scholarship) • Will be assessed by an educational institution in connection with federally-supported campus-based aid and federal loans (e.g., FSEO grant, work study, Perkins loans, institutional funds, etc.) • Generally no negative impact on overall financial aid package • Typically reduce loans or work study • Schools are encouraged to exclude IDA for state, local or school-funded assistance

  14. How can we work together to help your students access IDAs? • Referral partners • Community Partners • Let’s talk about what referral partners do first…

  15. What do IDA referral partners do? • Regularly provide IDA information to students • - distribute brochures/posting IDA information on • campus • - send regular IDA reminders (e-mail/snail mail) to • students likely to be eligible • - train Financial Aid staff to identify and refer IDA • candidates • Create an active referral process where students • sign up to be referred to the IDA program

  16. What do IDA Community Partners do? • Publicize the IDA program • Assist with the screening and application process • Assist participants to access appropriate training • Monitor participant compliance with savings and • training requirements • Review withdrawal requests

  17. Should your school consider becoming an IDA Community Partner? • Does your school provide services that involve • some level of longer-term, ongoing one-on-one • contact with students? • Would IDAs help you promote success for • students in the lower-income ranges?

  18. Your questions and ideas • Questions about the IDA program • How do you think we can help college • students access this program?

  19. For more information, visit our website at: http://www.communityloanfund.org/how-we-help/ida/how-we-can-help-you/education

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