529 plans

New Report: Rebalancing Resources and Incentives in Federal Student Aid

January 29, 2013
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New America's Education Policy Program has a new report out today that presents a comprehensive package of reforms to the existing federal student aid system for higher education. The Education team makes a compelling case for the need for reform:

In short, the present federal financial aid system is no lon­ger up to the demands of the times. It was built in a differ­ent era and has evolved haphazardly over the decades, in response to fiscal exigency and interest group pressures. It has become unwieldy, inefficient, and overly complicated, in a way that wastes taxpayer dollars and fails to provide institutions and students with the resources and incentives they need to complete high-quality college degrees....Taxpayers and students need an aid system that is simpler, more understandable, more effective, and fairer.

In particular, they propose reforms that dramatically strengthen the Pell Grant program, simplify the federal student loan program, eliminate education tax breaks which currently favor higher-income families, boost programs that support disadvantaged middle and high school students, and make institutions of higher education more accountable to both students and taxpayers.

The Lottery Effect: Basing Policy on Outliers Is a Bad Idea

December 10, 2012

Here at the Asset Building Program we write regularly about the inefficiency and ineffectiveness of asset limits in public benefits programs. Recent research conducted by our own Aleta Sprague and Rachel Black documents the substantial burden asset limits place on benefits administrators and participants alike, examines trends with asset limit policies at the state level, and identifies ways to reform these policies to better promote long-term financial stability.

In particular, Sprague and Black found that asset limits for benefits like SNAP (food stamps) and TANF (cash welfare) run counter to purported program goals of efficiency and financial independence. As guest blogger Jessica Bartholow recently put it: "remember what more than a decade of research on asset poverty and economic security for low-income households has taught us: that families are less likely to find their way back to financial solvency when they’ve lost everything they have." Forcing families to spend down any small savings they have before they qualify for benefits thwarts their efforts to get back on their feet.  

Sprague and Black have a new piece of commentary up on the Spotlight on Poverty site that delves into some of the recent policy conversations states are having about asset limits.

Accumulating Wealth is related to Youth’s Math Achievement

November 8, 2012
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The link between household wealth and youth’s educational outcomes has been confirmed by numerous research studies, finding that youth tend to do better educationally when their households have more wealth (click here and here for more information). A new paper from the Assets and Education Initiative at the University of Kansas School of Social Welfare confirms the relationship between household wealth and math achievement for youth from the U.S. and Ghana. The paper adds a unique contribution to existing research.

Event Summary: Financing College Success

May 31, 2012
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Thursday, May 31, the Asset Building Program hosted an event Financing College Success: Innovations to Promote Readiness, Access, and Completion. We were particularly excited to host Martha Kanter, Under Secretary at the U.S.

Summarizing the Research: The Impact of Student Loans on College Graduation

May 9, 2012
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The topic of student loans is being debated in the Senate this week, with lawmakers on both sides of the aisle hoping to pass legislation that would curb rising interest rates. Without legislation, interest rates on federal student loans will double from their current rate of 3.4% to 6.8% beginning on July 1st. A recent article in the New York Times provides a good summary of this debate.

What the President Really Should have been Slow Jammin' with Jimmy Fallon About

April 25, 2012

Last night, President Obama took to the Late Night stage to deliver his call to action to prevent interest rates on federal student loans from doubling in July...slow jam style. He focused his message on preserving college access and affordability and the threat posed to each by rising student loan costs.

A Federal Budget that Puts Higher Education within Reach: the ASPIRE Act and Inclusive 529s

April 17, 2012
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Going to college and getting an education has long been regarded as a reliable path out of poverty. And for good reason. Research by the Pew Economic Mobility Project shows that children in the bottom income quintile have a forty-five percent chance of remaining in the bottom quintile if they only have a high school education; those who get a college degree only have a sixteen percent chance. Likewise, the average college graduate makes $29,000 more per year than someone with only a high school diploma.

Yet when a college education isn’t even an option because of its excessive cost—as is increasingly the case for many U.S. families—this narrative falls apart. Today, the average American household must devote a significant portion of their annual income to tuition in order to make attending college a reality. Although in the long run the educational system needs greater structural changes, two policy reforms that would facilitate saving for college from a young age—the ASPIRE Act and improved 529 accounts—would allow a greater number of low-income students to access higher education.

Introducing The Assets Report 2012 and Infographic!

April 10, 2012
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Every year, the Asset Building Program analyzes the President's budget request to see how much goes to support asset building policies. More importantly, we keep tabs on how this money is spent because this is the key to understanding who the spending is benefiting.

Asset Building News Week, Mar 5-9

March 9, 2012
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The Asset Building News Week is a weekly Friday feature on the The Ladder, the Asset Building Program blog, designed to help readers keep up with news and developments in the asset building field. This week's topics include unemployment, inequality, education, and homeownership.

Santorum Raising the Wrong Concerns about College

March 5, 2012
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Recent comments by presidential candidate Rick Santorum have invited skepticism on the importance of a college education. And, there are legitimate reasons to question the value of a college degree, to be sure. After all, the cost of college is going up and the ability of most families to pay those costs is shrinking in comparison.

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