Child Development Accounts: A Universal and Progressive Asset-Building Policy for Economic Equality

Reduce Extreme Economic Inequality and Financial Capability and Asset Building for All were selected by the American Academy of Social Work and Social Welfare as two of the 12 Grand Challenges for Social Work Initiative in 2015. The Reduce Extreme Economic Inequality Grand Challenge focuses on reducing the broad inequality of wealth and income through a variety of policy innovations. The Financial Capability and Asset Building Grand Challenge aims to promote access to financial services, asset-building opportunities, and financial education and guidance for all. Both grand challenges have proposed to use universal and progressive Child Development Accounts (CDAs) as an inclusive policy to encourage lifelong asset accumulation, to practice and promote individual financial capability, and to reduce wealth inequality. This roundtable session will discuss the potential of CDAs to achieve the goals of two grand challenges, and the potential research collaboration between two grand challenges on this policy strategy.

CDAs are savings or investment accounts to encourage families to accumulate assets for long-term developmental purposes, such as post-secondary education, homeownership, entrepreneurship, and retirement. Ideally, CDAs should be universal (i.e., including all children) and progressive (i.e., providing additional support to disadvantaged children). Research evidence shows universal and progressive CDAs built on the existing design of college savings plans can be achieved in a full population. Furthermore, CDAs have positive impacts on financial outcomes (e.g., account holding and asset accumulation) and non-financial outcomes (e.g., parental expectation, parenting practices, parental mental health, and children's social-emotional development) in early childhood. Key designs features to achieve CDA goals have been identified in research, including universal eligibility, automatic enrollment, automatic initial deposits, and automatic progressive subsidies. In the US, several states and municipalities have initiated CDAs with various program designs, creating opportunities to learn from each other and to generate an integrated policy framework. In the global context, CDAs have been demonstrated and implemented in UK, Canada, Singapore, Korea, and, most recently, Israel. Panelists will briefly describe their CDA and asset-building research and the implications of their research on CDA policy practices. Panelists will summarize the main research findings and policy achievement on CDAs, and explore the role of social work researchers in future research and policy development. The roundtable session will encourage session participants to share their thoughts and ideas with panelists in a facilitated discussion guided by the following questions:

1.What are the key research questions to promote CDA policy for all children? 2.What strategies, methods, and partnerships are needed to implement universal and progressive CDA policy? 3.How should this research and policy agenda interact with other research and policy development to build financial capability for all and to reduce economic inequality proposed by two grand challenges? 4.What are the main opportunities facing social work researchers on this topic?