CFRP Report | R.005.1213
The importance of a college education has risen dramatically in recent decades. Individuals with a college degree have higher paying jobs, increased career flexibility, and are less likely to be unemployed; meanwhile, broad shifts in the U.S. economy continue to trim the number of jobs available to those without a college degree, further amplifying the significance of higher education. Though many parents recognize the importance of sending their children to college, financing a college education has also become increasingly difficult. Tuition costs continue to climb, raising the barrier to entry and saddling many low- and middle-income students with substantial student loan debt. This report presents evaluation outcomes from the Child Support for College (CS4C) pilot program, an innovative collaboration between public and private entities developed to promote college savings and attendance among those in the Texas child support system through incentivized college savings accounts.
Throughout the 18-month pilot, CS4C encountered a number of successes and challenges. Though the program struggled to attract the interest of potential participants, over one-third of individuals who inquired about the program received at least one financial coaching session, and two-thirds of these individuals opened college savings accounts. Over the course of the pilot, significant changes were made to the incentive structure and participation requirements. These changes resulted in considerable increases in the number of account openings, as well as a reduced lag between inquiry and account opening. For many of those who opened accounts, CS4C also marked the beginning of college savings, a process which research indicates may carry important psychological benefits for account openers who now believe their child will go to college – a vital element to college success.
Participants were motivated to participate in CS4C primarily by a desire for their children to pursue higher education and a commitment to helping their children achieve this goal; in addition, participants cited the importance of CS4C savings incentives as a catalyst in their decision to open an account. Participants were not significantly motivated, however, by the receipt of a lump sum child support payment as originally hypothesized. In fact, participants who failed to open accounts often cited inconsistent child support and insufficient money as substantial barriers to participation, and those who opened accounts tended to have higher income and education than those who did not.
The CS4C program also revealed several programmatic lessons that will advance the field of asset building as a strategy for college savings. For example, through the pilot, program partners learned the limits to the guidance that financial coaches can provide clients, leading to a push for new policies around financial coaching. Moreover, CS4C revealed the importance of carefully aligning the program design with the core principles of asset building. Although the program aligned with the basic tenets of asset building in many respects, CS4C also inadvertently incorporated adverse incentive structures and a number of barriers to account opening. As these barriers were removed, more accounts were opened. Finally, this pilot highlights the need to ensure consistency between program goals and the existing goals of participating institutions to facilitate long-term sustainability.
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