With cities' programs for poor, IT PAYS TO SAVE(!).

[JohnWxy]

http://www.usatoday.com/news/nation/2009-02-18-bonus_N.htm


Yahoo! Buzz Digg Newsvine Reddit FacebookWhat's this?By Martha T. Moore, USA TODAY


NEW YORK — Should people be paid to behave responsibly? Some cities think so.
New York wants poor people to save money, so it is offering a big incentive to encourage them to do so: a 50% match of up to $250 if they put money from their federal earned-income tax credit into a savings account and keep it there for a year.


MORE: Cash incentives to save gain interest in N.Y.

In San Francisco, families can get $100 just for filing for the earned-income tax credit, which gives low-income workers up to $4,800 beyond their wages.

"There's nothing that speaks as loudly as the opportunity for someone to receive a little bit more cash," says city Treasurer José Cisneros.
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I'm glad to see this. I have advocated for years for tax incentives in the form of a tax credit for savings account interest earned (up to a certain ceiling) to give the saver a chance at making a more attractive, effective rate of interest. This would incentivize saving money. There are plenty of incentives through advertizing for spending money. What we need is some incentives for the small saver to bring up their savings account balances.. Also, introduces people to and reinforces another habit - saving some of your earnings!

This would actually help to provide the banking system with a bit more money and help keep loan rates lower. Beneficial effects all around.

[sandnsea]

1. They should require a 10% savings

To qualify for the match. And maybe it's time to change a little bit of that EIC and make it a college/business savings fund instead.