individual development accounts
nm assets
frequently asked questions
What is an IDA?
An Individual Development Account, or an IDA, is a restricted savings account
that is established for a very specific purpose.  Through financial planning,
using debt wisely, and discovering ways to either increase your income or
reduce your spending, it is possible to put aside funds in order to secure an
asset for you and your family.

What kind of asset can I save for?
An asset is something of value, that will likely increase in value over the years.  
Although “value” is often referred to as how much money an object is worth,
there are other types of value.  Learning a skill or trade that will help you secure
a job, developing strong financial management skills, and learning how to get
the most from community resources are all strong assets that can not be
taken away from you. Assets eligible under this plan are:

  • Creation or expansion of a business
  • First time homeownership
  • Education (college or trade school)

How do I know if I am eligible to save?
To be eligible, you must meet both of the following criteria:
Community Action New Mexico   400 Central Ave. SE #103  Albuquerque, NM  87102    505.217.2747
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Household Size
Annual Income Limit
1
$19,600
2
$26,400
3
$33,200
4
$40,000
5
$46,800
6
$53,600
7
$60,400
8
$67,200
  • The adjusted net worth of your household, excluding a home and one
    vehicle, falls under $10,000.

What if my income goes above the requirements while I am saving?
Once you qualify to open an IDA, you do not have to re-qualify.  If your net
income or net worth moves above the requirements you will not be removed
from the savings opportunity.

Why save this way?
These accounts are custodial accounts that will not put your federal or state
benefits at risk.

What do you mean by custodial account?
The savings account is a partnership between you and the organization you
are working with.  The account will be opened in both your names and will
require two signatures for any withdrawals.

Can the organization take my money?
No.  The savings account is your account.  Your signature is required for any
action on that account.  You can stop the matched savings plan at any time
and remove your money from the account.

What do you mean by “matched savings”?
Your savings is matched at a 4:1 ratio – a match of $4.00 for every $1.00 you
save.

How much will you match?
$4,000 is the most that can be matched to your account.  This means that we
will not match over $1,000 of your personal savings, for a total account of
$5,000.

What if I want to save more than $1,000?
You can save as much as you like in this account.  Once you reach $1,000 the
match (4:1) will stop, however you may continue adding to the savings.

When can I withdraw my funds?
Anytime.  However, in order to receive the match funds as well, the following
must be complete:

  • savings held in the bank for no less than 6 months;
  • graduate from the Financial Management and Planning Course;
  • prepare a Household Budget and a Family Financial Plan;
  • complete an Asset Plan showing use of funds.

What if more than one person from my family wants to save?
It is okay to open up more than one account per household.  No more than
$8,000 will be matched within any one household ($2,000 of your personal
savings).

Tell me about EITC.
The Earned Income Tax Credit (EITC) is a tax refund that must be claimed (i.e.,
you must fill out a very specific form) in order to be received.  If you had an
earned income this year and you fall within the income guidelines you may be
eligible for this income tax return.  

Where do I go for EITC help?
To find out more call TAX HELP New Mexico at 224-4TAX between February 1st
through April 30th.  TAX HELP has qualified tax preparers throughout New
Mexico who will help you file your state and federal income taxes for free.  

How do I open an Individual Development Account?
Call (505) 894-3469 for more information.