Imagine a philanthropic investment so powerful that it changes how children think — something that embeds the conviction, “I have a future. Education is for me, not for somebody else.” According to Patty Grant, Executive Director of the Community Foundation of Wabash County, Indiana, that ability to transform how children see themselves is part of what makes children’s savings accounts (CSAs) “a meaningful way, beyond just the financial impact of helping our families and our students, to…align with our mission to address the quality of life and incomes and educational attainment.”

Grant was joined by Carl Rist, a CSA expert and independent consultant and former Senior Fellow at Prosperity Now; Rebecca Loya, Ph.D., a research scientist at Brandeis University Institute for Economic and Racial Equity; and Benita Melton, Program Director-Education for the Charles Stewart Mott Foundation, in a conversation moderated by Sterling Speirn, Interim President and CEO of the Maine Community Foundation.

Drawing on research and experience, the presenters explored the history of CSAs, dating back to the original demonstration project funded by national philanthropies, and the recent growth in the number of CSAs today. Foundations donated $11.3 million to the 77 CSA programs surveyed by panelist Rebecca Loya in 2019, of which $9 million came from family foundations.

Panelists discussed the value of CSAs for private funders, including the chance to help children and families prepare early for the future; the opportunity to partner with public funders on a scalable intervention; and the chance to address root causes of income inequality. “So many of the things philanthropy deals with are the symptoms and results of poverty, but we rarely get to go right to the heart of it, which is a lack of financial assets and underdeveloped human capital,” observed Speirn.

Presenters encouraged funders of CSAs to:

• Start small, demonstrate success, and then grow;
• Communicate frequently with children and families about their CSAs so they can see how their accounts are growing; and
• Combine CSAs with other asset-building and financial literacy programs.

“Children’s savings accounts are not a silver bullet. They don’t solve these problems by themselves. They are most impactful when embedded into or layered onto other initiatives,” Benita Melton said.