Some 65,000 families of kindergarten students in the city now have savings accounts with an initial investment of $100 for future college costs thanks to a new initiative that began this week.
The college savings program, introduced last year by former Mayor Bill de Blasio, aims to defray the costs of higher education and encourage long-term investment by providing every public kindergarten student with the city an initial investment that they can access when they enroll in university.
The accounts were funded at the end of April. Families can now manage money through the program’s website.
“We need tangible and practical solutions to reduce the racial wealth gap, even more so now that we are out of the pandemic,” said Mayor Eric Adams.
“The Save for College program can reduce the amount students and families have to borrow in student loans, thereby combating the student debt crisis that has disproportionately affected students of color,” added the Mayor.
The citywide initiative, called the NYC Kids Rise Save for College Program, grew out of a 2017 pilot program to start college savings accounts for more than 13,000 students in Queens School District 30.
The money is saved in tax-advantaged 529 accounts, which can be used toward the cost of higher education and are funded by public and private money.
Proponents of the program cite research showing that students are more likely to attend and graduate from college if their families start saving early for higher education.
The citywide program will be offered to future public school kindergarten classes and some charter school students.
Parents who received the initial capital are eligible to receive up to $200 in additional funds if they open their own separate savings account for their children and link them to the NYC Kids Rise account.
Families can access and activate their accounts now through the program’s website, and schools across the city will launch a scholarship awareness campaign in May to show families how to activate and access their accounts, according to the Education deparment.
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