Assets for Independence (AFI) Program Evaluation: a Randomized Control Trial of Matched Savings Accounts (Individual Development Accounts or IDAs) for Low-income Households.
Trial Snapshot
- Phase
- Not Applicable
- Sponsor
- Enrollment
- 808
- Locations
- 2
- Primary Endpoint
- Asset holdings
Study Overview
Brief Summary
The U.S. Department of Health and Human Services, Administration for Children and Families (ACF) is conducting an experimental evaluation of the Assets for Independence (AFI) Program. This evaluation-the first experimental evaluation of Individual Development Account (IDA) projects operating under the Assets for Independence Act-will contribute importantly to understanding the effects of IDA projects and IDA project features on participants. IDA programs provide matching funds to participants when the savings are withdrawn to spend on qualified asset purchases, most commonly homeownership, business-related expenses, or education.
This study will build on the prior quasi-experimental AFI evaluation, as well as studies of other non-AFI funded Individual Development Account (IDA) projects. While some evaluations suggest that IDAs help low-income families save, rigorous experimental research is limited. No experimental evaluation of AFI-funded programs has been conducted to date. Of the quasi- or non-experimental studies, few have focused on AFI-funded IDAs.
The evaluation is being conducted in two sites, with the random assignment of 299 AFI-eligible cases in one site and 509 cases in the other, for a total of 808 cases. Each site randomly assigned sample members to one of two groups: a control group and a treatment group receiving conventional AFI services. The primary research questions the study seeks to answer are:
- What are the impacts of AFI program participation on the outcomes it is designed to address (e.g., savings and asset purchases)?
- What are the impacts of AFI program participation on other outcome domains that the program might influence (e.g., material hardship, alternative financial product use, economic well-being)?
- How do the impacts of AFI program participation vary over time and by participant characteristics?
The study uses a two-armed (treatment vs. control) experimental design. This design allows the first two questions above to be addressed using a rigorous randomized approach.
In addition to the impact study, the evaluation includes an implementation study to describe and document how the AFI program is designed, implemented and operated in the participating grantee sites during the time of the study. This information will be used to provide context for interpreting the findings of the impact study.
Detailed Description
The Assets for Independence (AFI) evaluation is being conducted in two sites. Both sites are located in major metropolitan areas of the southwestern U.S., serving client populations that are 60-75 percent Hispanic. Both have some similar program features: maximum savings periods of 24 months and matchable savings amounts of up to $1,000. Important for estimating design feature differences, there are also key differences in program parameters: required hours of financial education and IDA match rates. The sites enrolled their samples within a 19-month period from January 2013 through July 2014. Sample members in each site were randomly assigned to two equal-sized groups: a treatment group (those able to enter the site's IDA program) and a control group (those not able to enter).
IMPACT STUDY
The impact study is the primary quantitative component of the research. The data collection and analysis will provide estimates of the effect of IDA participation on short- and long-term client outcomes, as measured through 12-month, 36-month, and 60-month follow-up periods.
Participant outcomes will be measured at the time of random assignment and 12, 36, and 60 months after random assignment. Measures that pertain to short-term program effects include amount of savings and material hardship avoidance. These are the effects most likely to emerge within the first year. Additional measures include employment status, earnings, means-tested public benefit receipt, and net worth. In the long-term, effects on homeownership, business ownership, and secondary education attainment are likely to emerge.
An unexplored area of short-term effects of IDAs is the use of unmatched savings to meet emergency needs. In the early stages of AFI participation, households may establish a savings habit but may need to draw on their savings for unexpected expenditures or to offset an unanticipated drop in income. The hypothesized effect of such unmatched withdrawals of IDA deposits is an avoidance of material hardship in food and health. This effect will be estimated using a small set of household-level survey questions, including some items drawn from the adult well-being topical module of the Survey of Income and Program Participation (SIPP).
Study Design
- Study Type
- Interventional
- Allocation
- Randomized
- Intervention Model
- Parallel
- Primary Purpose
- Treatment
- Masking
- None
Eligibility Criteria
- Ages
- 18 Years to — (Adult, Older Adult)
- Sex
- All
- Accepts Healthy Volunteers
- No
Inclusion Criteria
- •Must be eligible for participation in selected sites' Assets for Independence-funded Individual Development Account programs.
Exclusion Criteria
- •Cannot be enrolled in other Individual Development Account Programs.
Arms & Interventions
Program
The program group is eligible to participate in the Individual Development Account savings program.
Intervention: Individual Development Account and financial education (Behavioral)
Comparison
The comparison group cannot enter the Individual Development Account program.
Outcomes
Primary Outcomes
Asset holdings
Time Frame: 12 months
Debt
Time Frame: 12 months
Material Hardship
Time Frame: 12 months
Secondary Outcomes
- Educational attainment(12 months)
- Earnings(12 months)
- Public benefit receipt(12 months)
- Employment status(12 months)
Investigators
Gregory Mills
Senior Fellow
Urban Institute