San Francisco Introduces Accounts-at-Kindergarten Proposal for College

Who says child savings accounts has to be a nationally instituted policy? 

Our friends in the City by the Bay are planning to introduce a system of accounts for students to save for college. Today, a front-page story in the San Francisco Chronicle details the new program, set to roll out later this year, that would provide a college account for every kindergartener entering San Francisco’s public school program. The program is designed to be implemented gradually – 25% of incoming kindergarteners will be enrolled this school year, 50% next year, with universal enrollment by the third year.The initiative will deposit $50 for every child entering primary school, with low-income students receiving an initial $100 sum. Furthermore, EARN – a California-based non-profit that promotes asset building for low-income families – has promised to match the first $100 of a family’s individual savings in each account.

The Chronicle article cites research from the College Savings Initiative indicating why this is good policy:

City officials point to a study from the Center for Social Development at Washington University in St. Louis that found children who had just some savings set aside for college were about seven times more likely to go.

Much of CSD’s research for the College Savings Initiative has linked account ownership and savings to college access and completion, and a recent New America brief builds on this framework, providing a menu of federal and state policy options that promote inclusive 529 college savings plans as a vehicle to increase college affordability, access, and completion. Included in the policy options are proposals for accounts-at-birth (or kindergarten) that could be implemented by states, or universally by the federal government.

It’s also pretty cheap in the grand scheme of things. Mayor Gavin Newsom is expected to include $400,000 in his budget submission next week to San Francisco’s Board of Supervisors, for the first ­two years of the program. Ostensibly, such a policy could set off a wave of similar enterprises in municipalities and states across the country. On the federal level, the ASPIRE Act would provide even more of a start ($500, with a chance for low-income families) for every child born in the United States.

While a few institutional details have yet to be resolved (including the small detail of approval from the city board), this serves as a signal to – literally – the rest of the world that providing early, targeted accounts should be a priority, even in a time of seeming fiscal austerity.