From Helena to Harlem: Barriers to Saving at Two SEED Sites

Abstract

Policy makers are increasingly interested in incentivized savings programs for low-income children. This study reports findings from interviews with caregivers of accountholders in the Saving for Education, Entrepreneurship, and Downpayment (SEED), a national research initiative. Although asset-building proponents emphasize that low-income citizens can save with the right supports, median saving rates in the SEED study were quite low. In-depth interviews conducted with 27 caregivers at 2 distinct program sites describe obstacles to saving. Barriers are categorized as financial, spatial, cognitive, and behavioral. Policy and practice implications may enhance low savings rates among low-income participants in many incentivized savings programs.

KEYWORDS:

• asset building
• children’s savings accounts
• poverty
• savings barriers