Looking ahead to the 2012 tax season, the Filene Research Institute hopes to recruit a few more credit unions for a new savings initiative.
The Saver’s Credit, the Earned Income Tax Credit and the refunds that taxpayers receive are all major contributors to the savings mix, so the initiative is designed to help taxpayers preserve as much of their refund as possible.
The Filene project, which is partially funded by the National Credit Union Foundation, stems from a Filene i3 initiative called Savings Exchange. The Savings Exchange is a two-pronged approach that addresses both the product and the support system to boost retirement savings and help members claim the Saver’s Credit they have earned.
The product is an automated IRA-designated club savings account with a low minimum balance of $10 specifically designed to take advantage of the Saver’s Credit. For the support system, think Weight Watchers for developing healthy financial behaviors.
At a Savings Exchange meeting, participants “weigh in” with savings and then receive ongoing motivation, support, savings tips, videos and encouragement from savings coaches. Progress, goal achievements and milestones are tracked on a savings guide map.
One key metric for the success of the program is the number of participants who successfully claim a Saver’s Credit on their tax return. Credit unions interested in participating can click here.
The i3 team collaborated with Kim Pate of the Corporation for Enterprise Development and project consultants John Hoffmire and Craig Wilson from Progress Through Business, a national non-profit organization. Hoffmire is also director of the Center on Business and Poverty at the Puelicher Center on Banking Education at the Wisconsin School of Business, University of Wisconsin-Madison.