How to Advocate for Children's Savings Policies
Increasingly, the path to economic security requires some sort of postsecondary education. But the soaring costs of college are a major barrier to many students from low- and moderate-income families.
Fortunately, even a little savings can have a big impact on the college graduation rates of low-income students. Research shows that low-income kids with just $500 or less in college savings are four times as likely to graduate from college as those without savings. Unfortunately, because of high fees, minimum deposits and other barriers, many of the educational savings programs currently available make saving difficult for low- and moderate-income families.
That's why children's savings account (CSA) policies—which increase access and promote savings for all families—are so important. Policies to establish strong, universal CSAs are beginning to emerge in cities and states across the country, often as a result of advocacy efforts from the asset-building field.
Recognizing the work of these advocates, and with more joining their ranks every day, the Assets & Opportunity Network convened the Children's Savings Policy Learning Group to create a forum for advocates from ten states across the country to share their challenges and successes and to learn the skills needed to launch new campaigns in more states. In March, the six-month learning group facilitated, by Network Leader Janet Byrd, Executive Director of Neighborhood Partnerships in Oregon, drew to a close.
The learning group was a beneficial opportunity for sharing ideas and best practices. The discussion covered the basics of making account design choices, the strategic importance of designing for scale and identifying funding needs, with direct examples from the field from experts and advocates in Nevada, Illinois, Massachusetts, Connecticut and the 1:1 Fund. Here's what we learned from these conversations:
Advocacy strategy hinges on account structure.
Account structure plays a significant role in determining how an advocacy strategy should take shape. The learning group discussed various models for CSA structures – e.g., 529 account models and several bank account models – along with the key features important to meeting their states' CSA goals, including whether the design could be scaled statewide or how universally accessible the accounts could be. They also explored a practice tool designed to help participants decide upon a preferred account structure.
Guest speakers included Linda English, Deputy Treasurer for College Savings at the Nevada Office of the State Treasurer, who shared details about Nevada's College Kick Start program as an effective model for a universal, statewide seeded CSA. Carl Rist, Prosperity Now's Director of Children's Savings, also spoke, highlighting bank-account-based models as an alternative to the more common 529-based CSA structure.
Learning group member Lucy Mullany from the Illinois Asset Building Group lent the group an additional perspective on 529s by sharing her experiences developing a series of advocacy options to help "fix the plumbing" of Illinois' 529 program, which faced many of the structural problems of current educational savings programs described above, into a more viable and accessible option for college savings for all Illinois families. Mullany shared IABG's early successes in this strategy, which increased demographic data collection, opened access to families with Individual Taxpayer Identification Numbers (ITIN) and removed 529 savings from TANF asset tests. She also identified her group's plans for further fixes that other advocates could consider, such as allowing for tax-time savings through split tax refunds, incentivizing savings for non-custodial parents owing child support and establishing automatic enrollment at birth or kindergarten.
Consider scale early.
Deciding on an account structure is only the beginning of a CSA policy strategy. The next steps involve putting a plan into action and deciding on the scale of the program from the earliest stages. To help guide this discussion, the learning group examined a case study from Massachusetts that highlighted the multiple levels of ongoing programs of differing scale and an overarching statewide legislative strategy. Exploring these programs revealed the need for programs to emphasize their strategy for scale and to draw the distinction between the loftier goals of a pilot versus a smaller, community-based program.
Guest speakers included A&O Network Leader and Network Steering Committee Member Margaret Miley, Executive Director of the Midas Collaborative, who highlighted efforts to support a state senator in introducing a universal children's savings account policy bill in the Massachusetts State Senate and how this bill could connect to ongoing efforts at the local level. Yiming Shuang, Director of Operations for FUEL Education, also discussed how a community-based strategy like FUEL's in the Boston area could feed into a larger, statewide policy strategy.
Look for creative funding strategies.
It's impossible to discuss advocacy strategy without thinking of the costs of implementing the policy goals. A&O Network Leader Jim Horan, Executive Director of the Connecticut Association for Human Services, presented the current public funding model for Connecticut's statewide CSA program, CHET Baby Scholars, which relies on residual state funds from the state's former student loan guarantee fund. This unique model underscored the importance of thinking creatively when seeking public funding sources for CSA programs, as well as the difficulty of seeking such funding through legislative appropriations – a source unlikely to be available in most states.
Horan also shared the challenges of solely relying on public funding and his preference for pursuing philanthropic support going forward. Carl Rist introduced the group to private and philanthropic models for funding CSA programs, highlighting Maine's Harold Alfond College Challenge and how the 1:1 Fund provides an alternative platform for private funding partnerships through small-dollar donations.
Don't forget about budgeting.
Budgeting for the predicted costs of a statewide CSA program is an essential part of the strategic decision-making process. Ezra Levin, Prosperity Now's Associate Director of Government Affairs, unveiled a draft tool for calculating some costs and building a predicted budget under various criteria, based on evidence from currently-operating programs and past research. The tool was tested by several learning group members and feedback was provided to refine the assumptions from the group members' experiences with funding and budget advocacy.
Tools for design and advocacy
Throughout the learning group, Prosperity Now staff identified resources and worked to develop new tools to help encourage strategic planning for new CSA policy campaigns. Key resources include
- Prosperity Now's Children's Savings website, featuring policy briefs, guides and research from past CSA projects.
- The Children's Savings Directory, featuring existing and planned initiatives across the country.
- Model legislation from states and localities with introduced or approved CSA programs.
- Interactive spreadsheet tools for deciding on account structures and potential program budgets for states.
By testing different tools and exploring the research available, learning group members contributed to Prosperity Now's growing understand of the needs of the field, some of which will be reflected in a forthcoming CSA design guide.
For additional information on tools and resources presented to the learning group, please email Holden Weisman at email@example.com.