A study from the University of Kansas, Elliot (2013), finds that having even as little $1 in college savings makes a child three times more likely to enroll in college than a child with no savings account. Also, students with designated college savings accounts between $1 and $499 are over four and half times more likely to graduate from college than students with no savings. Dr. Elliott elaborates in his recent article, “Are All Types of College Financial Aid Created Equal?”
Much of the research is this area suggests that developing programs to incentivize college savings among traditionally disadvantaged groups may translate into substantial future benefits for those students and their families. CFRP is currently evaluating one such program recently launched in Texas to assess the impacts of incentivizing college savings among the child support population. Known as Child Support for College (CS4C), this pilot program seeks to leverage transfers within the child support program for the purpose of encouraging college savings.
Preliminary results from the CS4C program suggest that even a relatively small amount of savings may have a large psychological impact on parents’ dream of sending their children to college. Participating parents tend to note the importance of talking with their children about the savings accounts, how the act of saving for their children’s education makes them feel proud, and how the program has helped them to give their children an opportunity they did not have. CFRP’s extensive evaluation of the CS4C program is due out later this year.
–by Daniel Dillon, Research Associate