A DIFFERENT GROWTH FUND
Mass. sets up new college fund for kids
Every child born or adopted in Massachusetts could be given $50 toward their education as part of SeedMA Baby, the first statewide college savings account program in the commonwealth.
Starting in January 2020, all babies born to Massachusetts residents will be eligible to receive the deposit into a 529 savings account through the Massachusetts Education Financing Authority, financed by the Economic Empowerment Trust Fund with support from private donors. The account can be used for college, vocational and technical training.
“This program is designed to empower families from Boston to the Berkshires to everywhere all over the state to save for their child’s higher education,” Treasurer Deb Goldberg said. “We are empowering the next generation of Massachusetts residents.”
The program’s rollout makes Massachusetts the only state that has more than one government-backed college savings program, according to Goldberg. In addition to SeedMA Baby, other state savings programs include Soar MA and Boston Saves.
“It’s going to make a real difference in the lives of families all over Massachusetts,” Mayor Martin J. Walsh said. “It’s going to help families save for college and it’s going to help kids develop confidence — something that is important for us. It’s going to show young people in Massachusetts that college is possible and that their community believes in them.”
Research on children’s savings accounts shows that low- to moderate-income kids with as much as $500 in an account are three times more likely to go to college and four times more likely to graduate than their peers with no college savings, according to Carl Rist, senior director of children’s savings for Prosperity Now.
Robert Hildreth, the founder of Inversant, presented a check from his private philanthropy, Hildreth Stewart Charitable Foundation, for $300,000 to the program yesterday.
Goldberg’s office of Economic Empowerment launched a three-year pilot program in 2015 in which families in Worcester and Monson were encouraged to plan and save for their child’s future. In its final year of the pilot program, SeedMA laid the foundation for a statewide expansion to reach families in all cities and towns across the state.
“One of the valuable lessons we’ve learned from our pilot program was the appropriate ways in which to go statewide,” Goldberg said. “After gathering our school data and looking at best practices, it became clearer and clearer that an at-birth model was the way to go.”