Center on Assets, Education, and Inclusion

In the last few decades, children's savings accounts (CSAs) have emerged as a strategy for preparing children for their educational and financial futures, especially for those from low- to moderate-income households. This means a savings account is opened early in life and any accumulated savings can be used toward children's future expenses like college tuition or small business entrepreneurship. One question regarding CSA design is whether ownership over accounts should reside with children or parents. In other words, do children benefit educationally and financially when CSAs are in their names, or is it sufficient for parents to save on their children's behalf? This brief presents findings of the effects on children's financial futures when savings accounts are opened in their names. Findings validate the design of many existing CSAs and point to the need to reexamine policies that may discourage families from establishing accounts in children’s names.