NEW YORK (CNN/Money) - Shortly after the Sept. 11 terrorist attacks, Carmen Kelley was worried.

The struggling 24-year-old single mother had just graduated from UC-Berkeley and started working in human resources. With the economy in a downturn, she was concerned that she wouldn't be able to set aside funds to buy a home or fulfill her dream of earning an MBA -- assets she hoped would propel her to more financial security in the future.

Fast-forward three years and Kelley has now started the process of applying to business school, thanks to a special savings program called an individual development account administered by San Francisco-based non-profit Earned Assets Resource Network (EARN).

While it's hard enough for the average American to sock away a few extra dollars, if the nation's zero savings rate is any indication, for low-income families, saving for a house or a college degree is even more challenging. For that reason, IDAs are becoming an increasingly popular tool among the working poor to help jumpstart their savings and have become a model for legislators on how to combat poverty.

The individual development accounts program provides low-income individuals and families with a matched savings account and financial literacy training to help them accumulate assets for the specific purpose of buying a home, paying for college or starting a small business.

To qualify for an IDA, a person or family must earn less than two times the national poverty level, currently $18,620 for an individual or about $37,000 for a family of four. The Census Bureau estimates that there are nearly 37 million people living at or below the poverty level.

The person must be saving for a specific goal, and must attend financial workshops to learn how to manage their money.

Local, non-profit community groups administer the IDA programs and provide financial education while private foundations and the federal government, through a $25 million grant, match an individual's savings to help their account grow. The size of the match can vary from program to program. In the case of EARN, the non-profit provides savers with the promise of a 2-to-1 match. Once the saver accumulates $2,000 in the account, EARN will match that contribution with $4,000.

While IDAs first became available in the mid-1990s in a handful of demonstration projects, they've sharply grown in popularity since 2000. Currently, there are about 500 organizations in the country that run these programs with about 28,000 participants, said Carol Wayman, senior legislative director at the Corporation for Enterprise Development (CFED).

That's up from 12,252 accounts in 2003, and the organization projects that the number of enrollees could grow to as much as 50,000 by the end of 2005.

For that reason, public policy groups and political leaders are calling for the government to provide better funding for these programs.

Fred Nathan, executive director of Think New Mexico, an independent think tank, recently petitioned the government of New Mexico, which has one of the country's highest poverty rates, to fund an IDA program for the state. He said while the plan has received bipartisan interest, the biggest hurdle is the expense. To create 1,000 IDAs would cost the state $600,000 per year.

"It's expensive, but we're pointing to what's happened in the other states that have this program in place," he said. "There are higher rates of banking, lower credit card debt, higher homeowner rates, and people that participate in IDAs tend to stay in jobs longer and work more hours."

He said the funds could come from New Mexico's lottery.

On a federal level, Senator Rick Santorum recently introduced a bill that would amend the Internal Revenue Code of 1986 to provide matching funds for IDAs through a tax credit for qualified financial institutions that manage these accounts.

While the program sounds like an ideal solution, there are some difficulties. Interested individuals may have a tough time finding a funded IDA program in their community. (For a list of participating programs, go to www.idanetwork.org.)

There are also concerns that those at the poverty level may not be able to afford even the few dollars a month needed for an IDA.

"We're not talking about discretionary spending for most people in the lower-income category," said Ron Roge, chairman and chief executive at wealth management firm R.W. Roge & Co. "Most of their money is going towards food, health and shelter."

He said any method that encourages savings is helpful, but for some low income families, it may not be practical.

But Ben Mangan, president and chief executive of EARN, said earlier demonstrations in the mid-1990s proved that with this program, those below the poverty rate were saving more than the national savings rate.

"The working poor are on an economic hamster wheel," he said. "What they need to get off that wheel is assets and IDAs are a critical tool in building those assets."

CFED's Wayman said most people save about $25 a month, and an average of $700 to $900 a year including the state's contribution, in a tax-free interest-bearing account.

The secret is the financial education associated with an IDA programs, she said. By providing people with a goal and then the knowledge to create detailed budgets and spending plans, IDA programs help savers break the cycle of poverty.