Thursday, September 2, 2010

San Francisco mayor wants to create college accounts for kindergartners

Mayor Gavin Newsom
San Francisco's Mayor, Gavin Newsom, plans to include funding for a program that will help create college savings account for kindergartners in hi proposed city budget. If funding is approved, San Francisco would deposit $50 into college savings accounts for each kindergartner attending a city public school. Low-income students who qualify for free or reduced lunch would get $100. Once the accounts are open, the city would encourage donors to provide matching funds to encourage parents to save for college. EARN, a California nonprofit group that helps low-income families, has offered to contribute $100 for the first $100 that families put in the account. The program would be phased in over three years. The city would create accounts for about one-fourth of the city's 4,800 kindergartners the first year, half the second year and all incoming kindergartners the third year. The plan would cost about $200,000 the first year and $400,000 to $500,000 a year once it's fully implemented, said City Treasurer Jose Cisneros, who helped develop the program.

I think encouraging donors to match funds is a great idea. I also like the idea of the city starting the account for the family. Often times, I think families hold off due to other financial restraints or plain procrastination. If I had an account started for me with a promise that donors will match my contribution dollar for dollar, I would extremely excited to begin planning for my child's college. I feel a lot of kids nowadays do not go to college either because they don't have the funds for it and their parents' paycheck may not qualify them for programs such as pell grants even though they have to pay for college themselves. In addition, if the parents are investing in a college savings plan, you can bet that those parents are generally more involved with their kids' educations as well. After all, who would want to put money in a pot that isn't going to churn out some good rewards aka the child actually making it into college?

I love this idea and also the fact that the Gates Foundation will be evaluating the process and seeing how everything turns out. If successful, this may be just the model others states may need to follow! Love Love Love it!!!  

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