ASPIRE Act/KIDS Accounts

Student loan debt has been in the news a lot these days. In the last week, a number of news outlets wrote about mounting student loan debt and the delaying of life events by their borrowers (see ABC News, the Chronicle of Higher Education, CNN Money, the NY Times [here and here], and the Wall Street Journal, to name a few). The article in the NY Times provides a great example of this, "Consider Shane Gill, a 33-year-old high-school teacher in New York City. He does not have a car. He does not own a home. He is not married. And he is no anomaly: like hundreds of thousands of others in his generation, he has put off such major purchases or decisions in part because of his debts."

As I mentioned in a blog post a couple of weeks ago, families are facing a double-whammy to college affordability: costs are up and savings are down. The good news? As Rachel Fishman with the Education Policy Program and I discuss, there are a lot of things that the federal and state governments, educational institutions, and families can do to maintain access to higher education. To have a listen, click below.

Fresh off the presses are two reports highlighting the dismal state of college affordability: the first was released Wednesday by the State Higher Education Executive Officer's Association showing that college costs rose 8.3 percent last year and the second from Sallie Mae released last Tuesday (slightly less fresh) showing that less families are savings for college and thos

This is America Saves Week, which is an annual campaign that encourages nationwide discussion on savings and promotes good savings behavior. For those of us in the asset-building field, this is an opportunity to elevate research on the relationship between savings and life outcomes. This research can help justify the importance of good savings behavior, especially when these habits and behaviors start early in life. So in honor of America Saves Week, here are some of the research highlights from the asset-building field. Specifically, these highlights come from our research at the Assets and Education Initiative (AEDI) at the University of Kansas School of Welfare, where we are studying the relationship between children's savings and their financial and educational outcomes later in life.

Earlier this week, the Assets and Education Initiative of the University of Kansas School of Social Welfare and the Center for Social Development at Washington University in St. Louis released a report, “Linking Savings and Educational Outcomes: Charting a Course for Scholarship and Policy,” documenting some key findings from their symposium earlier this year. From children’s savings accounts to the Department of Education’s new GEAR UP initiative to reducing college debt, the report explores interventions that could put higher education in reach for all.

The link between household wealth and youth’s educational outcomes has been confirmed by numerous research studies, finding that youth tend to do better educationally when their households have more wealth (click here and here for more information). A new paper from the Assets and Education Initiative at the University of Kansas School of Social Welfare confirms the relationship between household wealth and math achievement for youth from the U.S. and Ghana. The paper adds a unique contribution to existing research.

Americans need to build up their savings, but what can be done to make that task easier? Reid Cramer laid out a number of policy ideas in his piece, "The Assets Agenda," in the current, special issue of The Washington Monthly.

As part of their week-long series with The Washington Monthly and the special, assets-themed issue of that magazine, MSNBC's "The Cycle" hosted Phil Longman on Tuesday afternoon. Phil was there to talk about his article, "How to Save Our Kids from Poverty in Old Age."

Watch the video:

Earlier this week, Demos held a great conference commemorating the fiftieth anniversary of Michael Harrington’s The Other America. The conference coincided with the publication of The American Prospect’s new issue focusing on poverty. During his introduction, Demos President Miles Rapoport acknowledged that the one-day event could not and would not be a comprehensive account of poverty in America; in fact, he specifically noted that there would not be any presentations focusing on the asset-building approach. Nevertheless, throughout the day, panelists touched on some core themes of the asset building field, particularly with respect to two areas of focus: investment in early childhood and the role (and limitations) of job creation in reducing poverty.

Children are significantly more likely to maintain a relationship with financial institutions and have greater financial assets later in life when they own a savings account earlier in life. However, some children gain access to savings accounts while others do not—an inequity that tends to be based on parents’ socio-economic status. This paper explores the case for extending financial inclusion to children by improving access to basic financial services.