Tax refund time is an important opportunity to build savings, particularly for low-wealth households who receive the Earned Income Tax Credit (EITC). The Earned Income Tax Credit for lower-wage workers ranged from $457 to $5,657, based on household size, in 2009. The IRS form 8888 allows tax filers to purchase savings bonds up to $5,000.
Bank branches play an important role in providing access to retail banking services, such as basic checking and savings accounts. Regulators measure how banks are doing in providing access to retail banking services on the CRA service test.
Until recently, the personal savings rate in the U.S. was negative 0.5 percent. Children need to be taught the importance of savings early. Governor Quinn is appointing a Task Force mandated to explore the development of a plan for instituting the children’s savings accounts.
The task force is charged with developing recommendations for a universal, statewide children’s savings plan which could help ensure that all Illinois children have the opportunity to build assets. Opened at birth and linked to financial education, the accounts would offer youth and their families the tools and incentives to accumulate savings. The proceeds could be used for long-term goals such as college or post-secondary training, buying a home, starting a business, or retirement.
One recent proposal, introduced by Congresswoman Tsongas (D-MA) and Congressman Petri (R-WI), promises to remove the savings disincentive. Currently, potential SSI recipients are disqualified if they have as little as $2,000 in savings for an individual or $3,000 for a couple and are required to spend down retirement savings. The SSI Savers Act of 2010 (H.R.