A Novel Unconditional Gifted Savings Program

Assessing the Impacts of a Novel Unconditional Gifted Savings Program

The goal of this randomized control trial is to test the impacts of an unconditional Gifted Savings account of $2,000 of assets ($100 United States Dollars available upon enrollment; $500 United States Dollars available for emergency use each year for two years) on adults with household incomes of three times the Federal Poverty Level or less in Yellow Springs, Ohio.

Many lower to middle income families are unable to weather an unforeseen financial emergency. Even in the best economic conditions, the personal saving rate in the US is profoundly low: just under 10% of disposable income. The consequences are as follows:

• Some low to middle income families, and particularly families of color and those headed by single women, turn to alternative financial services (pawn shops, credit cards not paid in full, high-interest loans, and payday lenders) to cover the financial shock. Others turn to family and friends.
• Over time, and with constrained financial resources, some households are unable to pay back these alternative financial services resulting in substantial debt. In the event these households turn to family and friends on a recurrent basis, relationships and a person's sense of dignity, worth, and control over one's future are fractured.
• These financial conditions cause stress, anxiety, and other mental health issues that lock a person in the here and now--rationally occupied with the dire economic conditions of the present and unable to plan for the future This has a resultant impact on cognitive capacity, hope for the future, future savings and goals horizons, and mental well-being.

This randomized control trial is being conducted to evaluate a program created by Gifted Savings (GS), an experimental non-profit start-up. GS is not a bank or an insured financial institution. GS will issue accounts seeded with $2,000 of assets in the form of cash, Bitcoin, and/or stock the experimental study group (n=250). The control group (n=500) will not receive a GS account but will be invited to complete study surveys every six months for 36 months.

For participants who receive a GS account, the original value of the account is not guaranteed, as assets may increase or decrease in value over time depending on market conditions. After two years, participants may withdraw the entire value of their GS account or choose to continue holding the assets in the GS account. Assets may be held forever or until the GS non-profit ceases to exist. GS funds are unconditional, which means there are no restrictions or limitations on how the money can be spent. Withdrawn funds will be available by check or direct deposit.

Over three years, researchers will measure the impacts of receiving a Gifted Savings account on:

• Psychological distress
• Employment and income
• Financial well-being
• Agency and hope for the future
• Material hardship
• Savings behavior and horizons
• Ability to manage financial shocks
• Subjective financial knowledge
• Cryptocurrency knowledge, attitudes, and behaviors

All participants will complete:

• A baseline survey
• Follow-up surveys at 6-, 12-, 18-, 24-, 30-, and 36-months after enrollment

Participants who receive a Gifted Savings account will:

• Register on the Gifted Savings website to claim their account
• Hold their Gifted Savings account assets for at least two years

Some participants who receive a Gifted Savings account will also participate in an in-depth interview.

Researchers will compare participants who receive a Gifted Savings account to participants who do not receive a Gifted Savings account to test the effects of receiving a Gifted Savings account on the above research questions.

Inclusion Criteria:

• Resident of Yellow Springs, Ohio
• At least 18 years of age
• Annual household income of three times the Federal Poverty Level or less

Exclusion Criteria:

• Not a resident of Yellow Springs, Ohio
• Under 18 years of age
• Annual household income of more than three times the Federal Poverty Level