AMES, Iowa – The announcement of the new donor-funded college savings program “Availa Kares” for students in Hamilton County schools is exciting for many reasons, according to Barb Wollan, a human sciences specialist with Iowa State University Extension and Outreach. Wollan was part of the small group who initially introduced the idea of universal child savings accounts to community leaders.
It’s not surprising that Wollan is pleased to see a project arise that will help every child with costs of education.
“Every dollar that students don’t need to borrow for education costs puts them one step closer to post-college financial security,” said Wollan, who specializes in family finance. “However, these types of accounts offer a deeper benefit that is even more significant. Research shows that simply having an account for post-secondary education leads to better education outcomes for the students, especially for students with low or moderate income.”
About 20 years ago, researchers began studying children’s savings and college attendance, Wollan explained. As the research progressed, it became evident that students with dedicated savings accounts are several times more likely to finish high school, go on for some training after high school, and complete that training or degree program.
“The likely explanation is that when children, especially at an early age, learn that they have a savings account for college, they start to see college as a possibility. That’s the most exciting aspect of Availa Kares: it will lead children, and their families, to build higher aspirations and a vision for a stronger future. This is especially valuable for children in families where no one has been to college or has any training after high school,” Wollan said.
The Financial Literacy Council of Greater Hamilton County, of which Wollan is a board member, will administer the Availa Kares program, with support from the Enhance Hamilton County Foundation. The program is named for its local sponsor, Availa Bank.
“While details are not in place yet, financial education will be central to the project. We hope donors will arise who will make deposits to the accounts of children when their families participate in financial education opportunities. I look forward to being part of that outreach,” Wollan said.
The outcomes of child savings account projects are long-term in nature, commented Wollan, but she has no doubt of positive results.
“Fifteen or 20 years from now, we expect to have a cohort of young adults who, thanks to some post-secondary education, are equipped for better-paying careers and have a stronger financial foundation based on adequate income and strong financial skills. Availa Kares will strengthen the future well-being of the individuals involved, and also of the community as a whole.”
The Financial Literacy Council of Greater Hamilton County announced the Availa Kares program during a news conference Aug. 15 in Jewell, Iowa.
Photo: Members of the Financial Literacy Council of Greater Hamilton County and the Board of Directors of Availa Bank look on as Rick Young, president of the Financial Literacy Council (seated at left), and Jeff Scharfenkamp, president and CEO of Availa Bank, sign a letter of agreement to initiate the Availa Kares program.