State Treasurer Deborah Goldberg announced at the Economic Empowerment Trust Fund board meeting on March 7, 2022, that she is convening a task force to explore the creation of Baby Bonds in Massachusetts. The Baby Bonds Task Force will provide comprehensive recommendations to the State Treasurer on developing an at-birth publicly funded trust fund program for Massachusetts residents.
The Baby Bonds Task Force is a diverse cross-sector collaboration with members who have work, research, or volunteer experience in racial wealth equity, child welfare, public policy, community engagement, and asset-building initiatives. The Task Force will also serve as an instrument to engage with impacted communities to allow community participation in the design of the program.
*The above description was modified on July 22, 2022, to clarify the purpose of the Task Force.
Click here to view a complete list of the Baby Bonds Task Force members.
Baby Bonds Task Force Findings Report
The Baby Bonds Task Force released its Findings Report on December 12, 2022. Click here to read the complete recommendations for establishing an asset-building Baby Bonds program in Massachusetts.
Frequently Asked Questions
What are Baby Bonds?
Baby Bonds are significant financial investments made by the government into a collective fund on behalf of newborn children. These investments are managed by the government and grow throughout each child’s life. The funds are accessible to each child when they turn 18 and can be used to support an asset-enhancing activity, like paying for higher education, buying a house, starting a business, etc., that can increase in value over time or generate wealth.
Children born into households with low income (which are disproportionately households of color) are prioritized through eligibility requirements set by the state or through a progressive allocation system, with those with the lowest income receiving the largest investments. This is to provide the most support to children born with the least resources, and to shrink the racial wealth gap.
Read more about this program on Prosperity Now’s website.
Is this different than the BabySteps Savings Plan?
Yes! Baby Bonds is just a proposal right now in Massachusetts, and the BabySteps Savings Plan is a program already available in Massachusetts. The programs have unique goals and utilize different processes for creating impact to uplift Massachusetts families. Read more about the program differences below.
Baby Bonds would automatically provide children born in Massachusetts with a significant financial investment in a government-owned account. The BabySteps Savings Plan is an opt-in program that provides parents with a free $50 deposit when they open a 529 U.Fund savings account for their child within one year of their birth or adoption.
Baby Bonds use a collective fund through which the state invests funds for the benefit of eligible children. Families cannot invest into the Baby Bond account. The BabySteps program makes use of individual 529 U.Fund accounts and encourages families to actively contribute to their child’s savings account.
Baby Bonds funds would become available to each child when they turn 18 and can be used to purchase assets that can increase in value over time or generate wealth (e.g., higher education, buying a house, starting a business, etc.). The BabySteps Savings Plan is focused on funding post-secondary education or qualified job training. Savings can be used to pay for college, vocational school, some apprenticeship costs, student loan repayments, and even tuition expenses for K-12 education.
Are any other states offering Baby Bonds?
Yes!
Connecticut and Washington, D.C. have passed laws creating Baby Bonds. Additionally, Iowa, New Jersey, New York, and Wisconsin are all considering similar Baby Bonds proposals. Senator Cory Booker and Representative Ayanna Pressley have submitted a bill to establish a national Baby Bonds program.
Why is the Office of Economic Empowerment interested in Baby Bonds?
Baby Bonds has the potential to massively increase the wealth of all future generations of young people, significantly narrow the racial wealth gap in our state moving forward and invest funds back into the community through homeownership and small businesses.
Baby Bonds would create countless benefits for Massachusetts residents across a range of the Office of Economic Empowerment’s priorities. These priorities include increasing access to financial education, closing the race and gender wage gap, addressing racial equity, expanding college affordability, and promoting STEM education.
How can I get involved?
The Office of Economic Empowerment wants to ensure this program is created with the invaluable input of Massachusetts residents. The development of the Baby Bonds Task Force invites people across different communities, backgrounds, ethnicities, and professions to give their input.
We encourage you to join our mailing list to get updates on how to get involved.
Additional Resources
- Baby Bonds Task Force Findings Report
- A Brighter Future with Baby Bonds: How States and Cities Should Invest in Our Kids (Prosperity Now webinar recording, February 17, 2022)
- A Bright Future for Every Child: How Your State Can Narrow the Racial Wealth Divide with Baby Bonds (State Policy Brief, Prosperity Now & The New School, November 2021)
- Growing Wealth 101 (Office of Economic Empowerment & Brandeis Institute on Assets and Social Policy)