Newborns and underserved public-school students in California now have a jump-start to education savings with seed investments of up to $1,500 through the California Kids Investment and Development Savings Program (CalKIDS).
The program will serve an estimated 450,000 newborns annually in California and 3.4 million eligible low-income public-school students, California’s Gov. Gavin Newsom recently announced. CalKIDS will invest $1.9 billion into accounts for eligible students in grades 1-12 and for newborn children born on or after July 1, 2022.
“California is telling our students that we believe they’re college material – not only do we believe it, we’ll invest in them directly,” Newsom said in a news release. “With up to $1,500, we’re transforming lives, generating college-going mindsets, and creating generational wealth for millions of Californians.”
All participants will automatically receive seed deposits and other possible financial incentives in a CalKIDS account.
All babies born in California on or after July 1, 2022, will receive up to $100 in a college savings account. Additionally, eligible low-income public school students may qualify to receive up to $1,500 in college savings for their future.
CalKIDS is administered by the ScholarShare Investment Board, a state agency chaired by State Treasurer Fiona Ma that oversees ScholarShare 529, the state’s official college savings plan.
“It is widely understood that education serves as the great equalizer, especially among underserved students. An investment of this magnitude in our children will undoubtedly help make the dream of a college education come true for a large number of families statewide,” Ma said.
The funds can be used to pay for qualified expenses at eligible educational institutions nationwide and some abroad, including community colleges, universities, and vocational and professional schools.
State officials say CalKIDS is the largest children’s savings account (CSA) program in the nation. Newsom’s office said CalKIDS will send notification letters to qualifying children and families with more information.