Initial elementary education findings from Promise Indiana's Children's savings account program

Abstract

The study conducts an initial examination of the associations between participation and saving in the Promise Indiana Children's Savings Account (CSA) program and school administrative data on attendance and standardized math and reading scores. The primary research questions guiding this analysis are whether or not having a CSA is associated with lower absenteeism and/or higher reading and math scores and, for those who have a CSA, whether being a saver or the amount saved in the account is associated with better academic outcomes. Given the importance of family income to savings behaviors and academic achievement, analyses were conducted for the full sample as well as for the subsample of low-income students, defined by free/reduced lunch status. Among the low-income subsample, having a CSA is positively associated with both reading and math scores; this association is not found in the aggregate sample. The amount contributed to the CSA has a positive association with math and reading scores in the overall sample, but not with the scores of children receiving free/reduced lunch. Being a saver is associated with reading scores for both the overall and free/reduced lunch samples. Student attendance was not associated with any account variables. While more research is needed before policy conclusions can be drawn, these findings suggest that CSA programs may complement schools' academic objectives. Further, this study adds to the literature on children's assets by finding some differences in academic outcomes associated with different engagement with the CSA (e.g. account ownership and saving).