Inequalities in College Savings and Educational Outcomes across Race/Ethnicity, Immigrant Status, and Gender: A Quantcrit Approach

Background: Wealth has been associated with a host of positive outcomes. Yet, persistent wealth inequalities exist across various dimensions of identity, including race/ethnicity, immigration status, and gender. These inequalities are often compounded through intersecting dimensions of identity such as race/gender/immigration status which puts those individuals at a unique disadvantage.

Education has a unique relationship with wealth, it is not only a key driver of income and, ultimately, wealth. However, wealth can be seen as perpetuating educational inequalities in a continuous cycle. Despite the increasing access to higher education, the wealth gap in college attainment has actually increased for recent cohorts as such social mobility has declined in the U.S. in recent decades. A trend that is most pronounced among Black families. As a result, college savings can be seen as vehicles for intergenerational transmissions of advantage for those with wealth, and conversely, disadvantage for those without. In this study, we use QuantCrit approach to demonstrate – how:

1. Race-gender and immigrant intersectional groups experience disadvantages across college savings, educational aspirations and outcomes.
2. College savings relate to educational aspirations and outcomes.
3. Intersectional disadvantages in college savings can produce disadvantages in educational aspirations and outcomes

Methods: The study utilized restricted-use data from the High School Longitudinal Study of 2009 (HSLS) (N = 5,720). Our analyses consist of two parts:

1. Descriptive: intersectional disadvantages across savings and educational outcomes. We use logistic, ordered logit, OLS, and Tobit regression models to demonstrate the descriptive relationships across intersectional groups and predictors (college savings accounts and savings amounts) and outcomes (STEM credits and GPA; educational, occupational, and earnings expectations; college enrollment; borrowing; and college majors) and the relationships between our predictors and outcomes.
2. Explore how intersectional disadvantages in savings are related to disadvantages in educational outcomes using a mediation path model based on a structural equation modeling (SEM) framework to understand how intersectional groups are related to educational outcomes through college savings.

Results: Nearly half of the participants had a college savings account (48.37%), the average savings was in the $10,001-$15,000 range. Overall, females experience college savings disadvantages across race/ethnicity and immigration status. Black and Hispanic females were much less likely to have college savings accounts and higher amounts of savings, findings which were similar in comparing first generation female immigrants with non-immigrant males.

Having a college savings account is associated with higher attainment and STEM occupation expectations, greater likelihood of college enrollment, lower amounts borrowed and lower likelihood of increased borrowing after starting college. Differences in college savings help explain differences in educational expectations and outcomes with respect to gender, race/ethnicity, and immigration status.

Conclusions: The patterns in our results indicate that educational expectations and outcomes among Black, Hispanic, and immigrant females are harmed by disadvantages concerning college savings and borrowing, wherein college savings may support the development of college-bound identities. College savings is not merely a financing mechanism, but a way to motivate academic performance and college attendance among groups traditionally underrepresented on college campuses, such as Black, Hispanic, and immigrant young women.