Information about Children’s Savings Accounts Overview and Examples Nationwide

1. Information about Children’s Savings Accounts Overview and Examples Nationwide Christy Finsel ONAC Program Manager 2012 ONAC Conference June 11, 2012

2. What Is A Children’s Savings Account? • One tool in the asset building toolbox is a Children’s Savings Account (CSAs). • CSAs help youth build a nest egg of savings. • CSA participants generally receive financial education as part of their participation in the program. Source: Christy Finsel, 2012.

3. Variations Among CSA Programs • CSAs, also known as Child Development Accounts, can be matched savings accounts, though some organizations that are designing CSAs do not provide a match to participant savings but instead either offer an opening deposit or set up accounts where youth can deposit money into accounts on their own, thereby helping the youth get banked. • Some CSA programs do not stipulate which assets the participant must purchase with their CSA funds. Other programs have determined that they want CSAs to be used by the participant to purchase a small business, home, or education, or to pay for medical expenses, school supplies, or retirement. Some CSAs just promote savings. • There are a variety of CSA programs being designed and implemented nationally. • There is no one right way to establish a CSA-you can create a CSA program to meet local needs. Source: Christy Finsel, 2012.

4. For those advocating for accounts for all youth, they can describe CSAs as “universal, long-term asset-building accounts established for children as early as birth and allowed to grow over their lifetime. In their ideal form, accounts are seeded with an initial deposit of $500 to $1,000, and built by contributions from family, friends and the children themselves. In addition, accounts are augmented by savings matches and other incentives.” Source: CFED, Why Children’s Development Accounts? Arguments and Evidence to Support Long-Term Asset Building Accounts for America’s Youth, August 2008.

5. Why Develop CSAs?Savings Can Change How Youth Think About Their Future • Children with savings are 4 times more likely to attend college shortly after graduating high school than those without savings. • Children with a savings account in their own name are 7 times more likely to attend college shortly after graduating high school than those without an account. • Study looked at children with accounts between the ages of 12 and 15 Source: The College Savings Initiative, a joint project of the New America Foundation and the Center for Social Development.

6. Proposed CSA in Kansas • The Kansas child support agency is partnering with the state treasurer to reward noncustodial parents who owe state child support debt and who save funds for their child’s college education through the Kansas 529 program. • The noncustodial parents who participate and make qualifying deposits will receive debt forgiveness on a ratio of 2:1 for every dollar deposited. Source: Nancy Thoma Groetken, 2012.

7. CSA Models Nationally • Kindergarten to College, San Francisco • Mississippi Community Financial Access Coalition • Heartland Alliance for Human Needs and Human Rights in Illinois • Raise Texas Child Support for College • SEED for Oklahoma Kids Initiative • There was a school-based pilot, 2003-2007, in the University City Public Schools with other St. Louis, Missouri, based partners. See the Center for Social Development and the University of Kansas paper, Contributions of Qualitative Research to Understanding Saving Theory for Children and Youth, 2012, http://csd.wustl.edu/Publications/Documents/WP12-23.pdf. • De La Salle Middle School, St. Louis

8. Native CSAs Nationally(List contains programs in development and those programs which are active or have completed a pilot phase) • Lakota Funds • Midwest Minnesota Community Development Corporation/White Earth Investment Initiative • Hawai’i County Department of Research and Development and Hawai’i Alliance for Community Based Economic Development (HACBED) • Cherokee Nation-involved as pilot site for SEED for Oklahoma Kids Initiative • First Nations Development Institute, McKinley County, New Mexico • Meskwaki Nation-potential program Source: Christy Finsel, 2012.

9. CSA Funding Sources • Ford Foundation • W.K. Kellogg Foundation • Tribal funds • First Nations Development Institute Youth and Culture Funds (could fund Native CSAs) • Local governments (i.e. City of San Francisco) • Private funds • Parent/family (i.e. grandparent) contributions • Youth contributions • Financial institutions • Other sources? Source: Christy Finsel, 2012.

10. Various Ways to Hold CSA Accounts • CSAs can be held in a custodial savings account at a financial institution • They can also be held through a 529 college savings plan • One Minnesota tribe holds them in trust accounts at an affiliate bank on the reservation Christy Finsel, 2012. Oklahoma Native Assets Coalition

11. CSA Resources • In case ONAC constituents are interested in CSA resources, ONAC will have CSA info available on our portal at www.oknativeassets.org. • If you are interested in CSA peer learning calls, contact Christy Finsel. • ONAC can provide CSA training and technical assistance, if needed. Oklahoma Native Assets Coalition