Colleen O’Dea | APRIL 4, 2019 | NJ Spotlight |
Social advocacy group urges Garden State to get behind Individual Development Accounts, a matched approach to savings funded by participants, nonprofits, and the state
A social justice advocacy group and some lawmakers are urging New Jersey to create a matched savings-account program for low-income residents as a way to begin to close the wealth gap between whites and people of color.
These Individual Development Accounts would operate like a 401(k), except the money could be used for more than just retirement. Under the plan, a person would deposit money every month and that amount would be matched by a nonprofit and by the state. The New Jersey Institute for Social Justice outlined its proposal Wednesday in a report titled “Reclaiming the American Dream: Expanding Financial Security and Reducing the Racial Wealth Gap Through Matched Savings Accounts.”
“Building on both state and private investments, these matched savings accounts will provide life-changing opportunities for people in our state using relatively modest investments of a few hundred dollars to a few thousand dollars per participant,” said Ryan P. Haygood, president and CEO of the New Jersey Institute for Social Justice. “We are experiencing income inequalities in the United States that we’ve not seen since the Great Depression nearly 100 years ago … New Jersey has a disaster.”
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