Cash-Flow and Savings Practices of Low Income Households : Evidence from a Follow-Up Study of IDA Participants

This study uses a survey of participants from an Individual Development Account (IDA) matched savings intervention to examine self-reported financial practices (cash flow and savings) five years after the intervention terminated. Latent class analysis produced three groups of financial practices -- high, medium, and low functioning. Results showed that some low income households are carefully managing their finances. Psychological sense of mastery was positively related to high functioning cash-flow and savings. The IDA intervention had no association with latent class membership. Antipoverty interventions should assess the financial practices of participants at the time of service enrollment. Further, social service providers should not assume that households are not already carefully managing their finances