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Journal of Family and Economic Issues

, Volume 31, Issue 2, pp 212–227 | Cite as

Does Prior Banking Experience Matter? Differences of the Banked and Unbanked in Individual Development Accounts

  • Michal Grinstein-WeissEmail author
  • Yeong H. Yeo
  • Mathieu R. Despard
  • Adriane M. Casalotti
  • Min Zhan
Original Paper

Abstract

Using data from the 4-year American Dream Demonstration, this study compares saving performance and program participation of banked (n = 1,538) and unbanked participants (n = 466) enrolled in 14 IDA programs. The study shows banked participants had $2.74 higher average monthly net deposit (p < 0.05); 5% higher deposit frequency (p < 0.001); and 42% less odds of drop out than unbanked participants (p < 0.001). Moreover, program characteristics such as financial education, monthly saving targets, peer group meetings, and direct deposit are important predictors of program performances. Individual characteristics such as race/ethnicity, home ownership, and income are significantly associated with program performance.

Keywords

Asset building Banked IDAs Savings Unbanked 

Notes

Acknowledgments

The authors wish to thank the following foundations for support of this paper: the Ford Foundation, Charles Stewart Mott Foundation, FB Heron Foundation, and Metropolitan Life Foundation for funding ADD research; HUD for the Early Dissertation Grant; the IDA program staff at the 14 research sites of the American Dream Demonstration (ADD); the Corporation for Enterprise Development for implementing ADD; Michael Sherraden, director of the Center for Social Development, Lissa Johnson, ADD research project manager; Margaret Clancy, for ensuring quality of the monitoring data; and Mark Schreiner for data management and preparation. Finally, the paper greatly benefited from the comments of Diane Wyant, Susanna Birdsong, and Roderick Rose.

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Copyright information

© Springer Science+Business Media, LLC 2010

Authors and Affiliations

  • Michal Grinstein-Weiss
    • 1
    Email author
  • Yeong H. Yeo
    • 1
  • Mathieu R. Despard
    • 1
  • Adriane M. Casalotti
    • 1
  • Min Zhan
    • 2
  1. 1.School of Social WorkUniversity of North Carolina at Chapel HillChapel HillUSA
  2. 2.School of Social WorkUniversity of Illinois at Urbana-ChampaignUrbanaUSA

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