A research report that follows the successful financial outcomes in a Child Development Account (CDA) experiment.

“Over 13 years ago, 1,358 treatment children received the CDA in SEED OK with a $1,000 deposit in the OK 529 plan, and 1,346 control children did not, the beginning of a long running CDA experiment. We made modest additional deposits for treatment children, but, beyond the early stages of SEED OK, the “treatment” was limited. SEED OK nevertheless serves to demonstrate that a successful CDA policy can be put in place and sustained. Moreover, the randomized experimental design has simply and cleanly revealed positive outcomes.

This summary covers financial impacts in SEED OK, showing that all children can have an asset-building account with resources that grow over time. In particular, the CDA greatly increases the likelihood that disadvantaged children have assets accumulating for their future education. In addition, the CDA in SEED OK has motivated additional OK 529 account opening by treatment parents, additional savings by parents, and greater representation in the ownership of OK 529 accounts by parents from diverse and less advantaged backgrounds.”

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By BROWN SCHOOL, Center for Social Development, Washington University in St. Louis