Our future is stronger with Children’s Savings Accounts (CSA)

A quick glance at Michigan’s growing CSA field

By Brian Rakovitis, manager of financial empowerment initiatives

Removing barriers to postsecondary attainment in Michigan provides more opportunities for low- and moderate-income communities, improves the quality of life for residents, and helps combat inequality. Savings play an important role in achieving increased attainment. Studies have found that low-income students with a dedicated college savings are three times more likely to attend college and four times more likely to complete college. 

Michigan is now host to a growing number of community-based savings programs, known as children’s savings accounts (CSA). CSA programs provide long-term savings accounts that offer incentives and financial education to families to save for their kids’ postsecondary education—whether it be college, a trade school, or another form of postsecondary education.

The City of Lansing launched Michigan’s first CSA program, Lansing SAVE, in 2015. This municipal-based CSA program operated by the City of Lansing and community partners offered deposit-only savings accounts to a subset of the Lansing School District kindergartens (scaling to all incoming kindergarteners over time). Shortly after the creation of Lansing SAVE, the Barry County Kickstart to Career CSA program came online. Supported by a $1.2 million endowment, Barry county’s CSA program automatically enrolled all kindergartners across the county. 

The CSA field in Michigan has experienced a rapid expansion of local growth, increasing from two programs, and less than 1,000 students enrolled in 2015, to 14 programs and 18,000+ students enrolled to date.

While CSA enrollees comprise only a fraction of the total student population in Michigan, a recent analysis of these CSA programs reveals that programs are on track to support populations that are underrepresented in postsecondary education, with 47% of CSA enrolled students from low- to moderate-income households, and up to 18% enrolled are students of color. 

Increasing postsecondary attainment across Michigan will require expanded access to Children’s Savings Accounts. The promotion of savings for kids will ensure that all youth, regardless of socioeconomic status, have the opportunity and resources to achieve their postsecondary goals. 

If you are interested in learning more about children’s savings accounts, please reach out to Brian Rakovitis.