Program seeks to jump-start college savings
September 14, 2013
A new state program aims to give Nevada kindergarteners a jump start on saving for college.
State Treasurer Kate Marshall said the pilot program will launch in October in the rural counties, setting up $50 college savings accounts for each kindergartner.
About 3,000 students are expected to receive an account, though an official tally won't be known until school districts take official enrollment counts later this month.
Marshall told the Las Vegas Sun she hopes to expand the program statewide to include Clark and Washoe counties at a later day.
No taxpayer money is involved. The program will be financed through grants, private donations and management fees Nevada receives from financial institutions.
Studies have shown young students with college savings accounts are seven times more likely to continue their education.
"It's important to note that the studies observed that the conclusions applied regardless of family income, ethnicity or the educational attainment of the child's parents," Marshall said.
Money will revert to the state if students don't go to college by age 25. They cannot use those funds for any other purpose.
Steve George, chief of staff in the treasurer's office, said part of the goal is to encourage parents and students to open a separate college savings account with their own money to augment their state account.
To that end, Nevada this month lowered the required minimum amount needed to open an SSgA Upromise 529 college savings plan account to $15, down from $250. The Upromise plan is sponsored by Nevada but available to residents nationwide.
"This is a tremendous plus for many Nevada low-to-middle income families who have struggled mightily over the past several years to plan ahead for their children's higher education expenses while our economy continues to rebound," Marshall said.