Children’s Savings Accounts

Colleen J. Quint: Children's Savings Accounts in New England and beyond

Children playing ball games, Roman artwork, 2nd Century A.D.

Children playing ball games, Roman artwork, 2nd Century A.D.

From The New England Journal of Higher Education, a service of The New England Board of Higher Education (


As students throughout New England head back to school this fall, tens of thousands of them have a head start on a bright future through a Children’s Savings Account (CSA). These investments in children’s future postsecondary education are offered in cities and states throughout the region—and beyond—and all share a goal of boosting college-going. CSAs are long-term savings or investment accounts for children that often include incentives such as seed deposit or matches to encourage additional savings. Withdrawals from CSAs are typically restricted for their intended use, usually education after high school.

Whether thought of as improving aspirations, building assets or creating a more educated workforce (or all three!) CSAs have the potential for an outsized impact. Promising early outcomes indicate positive effects on aspirations, academics and even health. Commonly understood as helping to create a college-bound identify, CSA programs are referred to by one leading researcher as “hope in tangible form.”

Earlier this summer, representatives of CSA programs throughout the region and beyond met at the Federal Reserve Bank of Boston for a “Celebration & Showcase” to mark the fifth anniversary of the creation of the New England Consortium of Children’s Savings Accounts (NECCSA). This regional peer learning group meets quarterly to share information and insights, discuss program innovations and explore research opportunities. By the end of last year, participating programs had awarded nearly $65 million to more than 132,000 children through their CSA programs. Importantly, families had invested over $76 million in additional funds.

Connecticut, Maine, Massachusetts and Rhode Island all offer statewide programs in which newborns have the opportunity for a seed grant to a CSA account. Through CHET Baby Scholars in Connecticut, My Alfond Grant in Maine, BabySteps in Massachusetts and CollegeBound Baby in Rhode Island, children born as residents of these states are awarded funds at birth—in some cases automatically, in others when parents open their own account. Massachusetts also has numerous city- and neighborhood-based CSA programs like Boston Saves, Inversant and the Cambridge Housing Authority. Rural northern New Hampshire has a program through AHEAD that helps students start saving in school. And just outside the region, programs are underway as well: a pilot program in New York Kindergartens and a statewide program announced in Pennsylvania.

The work in New England is in many ways a good representation of what is happening across the country. CSA programs can now be found in 34 states with nearly half a million children nationwide benefiting. And the field is building incredible momentum. Legislation has been passed this past year in Nebraska, Colorado and Illinois to create CSAs for children statewide. In the early days of his new administration, California Gov. Gavin Newsom has also committed $50 million to expand CSAs throughout the state. And a Mid-West CSA Consortium, modeled on NECCSA, has developed, supporting nearly a dozen nascent and emerging programs in that region.

So why are so many places deciding to develop CSA programs? There is early and compelling evidence that indicates a strong return on investment. An analysis of national data by the Center for Social Development, Washington University in St. Louis shows that children with a college savings account in their name, even if that account has only a few hundred dollars in it, are three times more likely to go to college and four times more likely to graduate. And a long-term randomized control study of one CSA program in Oklahoma showed that, five years in, children had social and emotional developmental gains as if they had participated in Head Start—and mothers had higher aspirations and lower levels of maternal depression.

Closer to home, the My Alfond Grant program in Maine has been looking at early outcomes as well. As referenced above, the My Alfond Grant program invests $500 at birth for every Maine resident baby. Following a pilot year in 2008, the program used an “opt-in” model from 2009 to 2012 during which time, a college savings account needed to be opened by a child’s first birthday in order for the grant to be awarded. Statewide, about 25,000 children were awarded grants during this time—approximately 40% of eligible children. For babies born as Maine residents beginning January 1, 2013, the $500 Alfond Grant is now awarded automatically. The program is now statewide, automatic, universal and at birth. Just this month, the Alfond Scholarship Foundation, the nonprofit organization that manages the program, announced a major milestone: $50 million invested for the future education of 100,000 Maine children.

With the oldest children benefiting from the My Alfond Grant program entering fifth and sixth grade this fall, high school graduation and college matriculation are still several years away. Yet research conducted by the University of Michigan through a grant from the Charles Stewart Mott Foundation has yielded valuable insights on interim measures of success. A quantitative analysis of family savings behaviors by those involved in the first five years of the My Alfond Grant program (when it used an opt-in model) showed that families at all income levels were saving—including 27% of families with annual household incomes at or below $25,000. Qualitative interviews with families suggest that families with Alfond Grants start thinking about college—and saving for college—at an earlier stage in their child’s life than they would have otherwise. And a recently conducted statewide quantitative survey that included opt-in families, universal families and those without an Alfond Grant found that families whose children had an Alfond Grant reported higher aspirations and even more positive health outcomes than those without a grant. Interestingly, there is no statistical difference between opt-in and universal families; the mere fact of having the Alfond Grant seems to be enough.

With Massachusetts looking ahead to January 2020 for the rollout of its Baby Steps program and Rhode Island’s recent check-the-box innovation (enabling an account to be opened on behalf of children whose families check a box granting permission to do so on the birth record form), more and more children throughout New England will benefit from having a college savings account in their name. And that can only be a good thing for those children, and for our region.

Colleen J. Quint is president & CEO of the Alfond Scholarship Foundation, which is based in Portland.