Dana Goldstein: The “Assets Effect”

Dana Goldstein, a Bernard Schwartz Fellow with New America and writer for publications such as The Nation, authored a piece for the July/August Washington Monthly that takes a look at the “assets effect”: namely, the impact ownership of savings has on young people as they strive to attend and complete college. Goldstein’s piece draws on the research and personal life experiences of Willie Elliott (a Senior Research Fellow with the Asset Building Program) to highlight the importance of savings for long-term educational success.

Her piece and remarks at our event in July identify some of the key links between education and assets. Having ownership of financial resources helps young people develop concrete college aspirations and ultimately succeed at attending post-secondary education. She sums up a few of Elliott’s key ideas this way: “Elliott posits that having some savings earmarked for college creates what he calls a “virtuous circle.” The money in the account may be miniscule compared to the cost of a college education, but it nonetheless has a powerful aspirational effect.”

Elliott and colleagues have now developed an extensive body of research that supports the creation of universal children’s savings accounts. By creating structures and pathways through which low-income students can interact with financial institutions, build up their own savings, and take ownership of building assets to support their educational pursuits, children’s savings accounts have the potential to improve educational outcomes and ultimately improve low-income young people’s prospects for economic mobility.

Goldstein’s commentary here on the interplay of assets and education is part of a longer event we hosted on July 11th with a panel of other contributors to this issue of the Monthly and other expert commentators. You can also view footage of remarks by Reid Cramer, Phil Longman, and Mark Schmitt. The full event “Jobs are Not Enough” is available here.

Goldstein and Longman appeared together to discuss their work on Minnesota Public Radio.