why children's savings accounts matter
In November 2014, the Evanston Community Foundation invited leaders of local banks and non-profit organizations to learn about the positive impact of assets on a child's future education and development from Andrea Levere, President of the Corporation for Enterprise Development (CFED).
As a leader in asset development as a key strategy to alleviate poverty and create opportunity, CFED has championed children's savings accounts. Levere invited the Evanston community to explore ways to create a community-wide initiative to create savings accounts for Evanston's young children.
natioanl context, local challenge
Research shows that children from low-income families with college savings accounts are more likely to graduate from high school, are almost twice as likely to have higher college aspiration than those without savings, and are three times more likely to attend college and four times more likely to complete college. Accounts with $500, or less, can make this difference.
savings account programs
Children's Savings Accounts (CSAs) are long-term savings accounts set up for children as early as birth. Three key ingredients for a successful CSA program include the network that already serves significant numbers of youths, a system of custodial accounts, and incentives.
CFED is a national leader in the asset-building field and can work with the Evanston community to establish a program fitting Evanston's needs. A network of established groups establish trust, communicate savings opportunities and provide financial education. Establishing protocols for the accounts insures that making deposits is easy and that savings are only used for their intended purpose. In many cases, communities develop ways to "seed" accounts and provide incentives for regular deposits to accounts.
The Evanston Community Foundation connected to Levere and CFED through our Two Generation Initiative and our engagement in the Ascend Network to advance two generation thinking and programs. Along with our partner Lindsay Chase-Lansdale of Northwestern University, Levere was in the first cohort of Ascend Fellows. As a result of her visit, a committee of leaders commited to convene future meetings to explore the development of a working model for Evanston. Stay tuned!