Posted July 16, 2020
K2C Program Data Shows How COVID-19 Exacerbates Racial and Economic Inequalities
San Francisco, CA – The experience of the Kindergarten to College (K2C) program run out of the Office of the Treasurer & Tax Collector shows that despite economic hardship as a result of the COVID-19 crisis, San Francisco families remain committed to saving for college. The report shows that while program savings declined, remarkably few families have requested emergency withdrawals, and families remain engaged with program activities.
The biggest declines in saving came from low-income families, particularly in neighborhoods with a high concentration of Latinx and Asian residents. From January to April 2020, Latinx family deposits declined by 42%, Asian family deposits declined by 43% and Black family deposits declined by 21%. By contrast, white family deposits declined only 10% during that same period.
“We created this program to show our children that they can go to college, and the City is here to help,” said Treasurer José Cisneros. “This report shows K2C works in even the most difficult of times, but we must focus our efforts on supporting San Francisco’s most vulnerable families.”
Treasurer José Cisneros and other City leaders were compelled to create K2C in 2011 when they learned that saving even small amounts for college can improve the odds that students will make it to college. Research shows that children with savings accounts will be up to seven times more likely to attend college than those without an account. K2C automatically opens a college savings account for every child entering the City’s public schools with a starting deposit of $50, financial incentives for families to save and a range of options for families to deposit directly into their account.
Highlights of the report include:
- Savings are down, but still significant – the amount and number of deposits decreased sharply in March. However, deposits rebounded in May 2020.
- The decline in deposits is disproportionately from low-income families of color – low-income families of color are more likely to make deposits in-person at branches and at in-school events and both activities were largely halted due to COVID-19.
- Families are not withdrawing funds from their K2C accounts – despite the economic upheaval of COVID-19, very few families have requested emergency withdrawals from their K2C accounts.
- Families are continuing to actively engage with the K2C program – families are still engaging with the program in a number of different remote ways during the pandemic.
K2C’s performance during COVID-19 underscores the power, durability and importance of K2C and other Children’s Savings Account (CSA) programs. Policymakers and advocates must continue to advocate for CSA programs that meet the needs of low-income communities of color and ensure that existing programs can continue to reach out to and support families.
The full report can be accessed here.
More about K2C:
In Spring 2011, the City and County of San Francisco launched the first, publicly funded universal Children’s Savings Account (CSA) program in the country. Kindergarten to College opens a savings account for every child entering kindergarten in the City’s public schools, putting students on a path to college from their first day of school.
To date, K2C has automatically opened approximately 44,000 accounts and San Francisco families have saved more than $5.5 million dollars of their own money for college. Between the family savings, the City’s contributions and private donations, the total value of Kindergarten to College accounts for our kids is now at $8.9 million dollars.