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2021

2020; child development accounts (CDAs); Trina Shanks; Patrick Meehan; policy; SEED National Initiative; youth; MI-SEED; Michigan;

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Mi-Seed Investment Funds And Account Growth: Implications For Achieving Higher Rates Of Return In Cda Programs, Trina R. Shanks, Patrick Meehan Feb 2021

Mi-Seed Investment Funds And Account Growth: Implications For Achieving Higher Rates Of Return In Cda Programs, Trina R. Shanks, Patrick Meehan

Center for Social Development Research

In 2004, the Michigan Saving for Education, Entrepreneurship and Down Payment initiative (MI-SEED) recruited 430 families through 14 Head Start centers, enrolling 497 children in Child Development Accounts (CDAs). Designed to begin to address wealth disparities between low- and high-income families, the MI-SEED CDA used the state 529 college savings plan as the investment instrument. This brief presents results on MI-SEED savings and withdrawals through 2019. The results suggest that investment strategy greatly influences account growth, and the authors offer recommendations for ensuring acceptable growth in CDAs.