Surrounded by parents, grandparents, aunts, uncles, cousins, and friends, my son Joel graduated from college on May 16. He completed his bachelor’s degree in four years without taking on any student loans. There are many reasons why he was able to do that, including the fact that Joel grew up in a middle class household with parents who expected him to go to college and started saving for his college education at birth. Joel was also eligible for some merit-based scholarships and grants and worked each summer to earn some spending money. Joel understands that not every kid has such opportunities and he thanked everyone who helped him along the way.
- Enacting local, statewide, and national universal child savings accounts programs. These programs not only increase savings for college but also create a college-bound identity for students and their families, which raises the likelihood that students will attend and graduate from college. While Illinois has not yet acted on the 2010 Illinois Children’s Savings Account Task Force Report and Recommendations, a growing number of states and local governments have adopted child savings account programs beginning at birth or kindergarten. A recent Federal Reserve Bank of Boston report analyzes the benefits and barriers of using 529 college savings plans and basic retail products as the platforms for these programs. Woodstock is working with Illinois Asset Building Group (IABG) and allies to continue the conversation and share the growing body of research and practice about universal accounts at birth. Making it possible for more Illinois students to complete college is important both for students’ economic opportunity and for creating a highly skilled workforce for the Illinois economy.
- Expanding access to 529 college savings plans. Working with IABG and Illinois Treasurer Frerichs’ and Governor Rauner’s offices, Woodstock has proposed a number of administrative changes to the Illinois Bright Start 529 plan which would make it more accessible to students and families from lower-income households. Making it easier for more lower-income families to participate in saving for college through Bright Start will increase the socioeconomic and demographic diversity of college students and help more of them have a shot at the middle class.
- Creating protections for students from poor quality for-profit colleges, misleading marketing, bad servicing, and high-cost private and institutional loans and prepaid cards. Woodstock has commented on U.S. Department of Education rules on gainful employment and Consumer Financial Protection Bureau guidance on campus prepaid cards. Among other suggestions, we have urged the Department to require higher standards for colleges to be eligible to receive federal student loans and to strengthen rules to protect students from being forced into using prepaid cards offered by banks with links to their college. With Illinois Senator Durbin and others, we have advocated for Congress to pass a Student Loan Borrowers’ Bill of Rights and the option to discharge non-federal student loan debt through the bankruptcy process that is available for almost every other kind of debt. We have supported the Consumer Financial Protection Bureau in its enforcement actions against shoddy for-profit schools such as Corinthian Colleges and its Request for Information about student loan servicing practices. Just last week, Woodstock issued a report on student loan debt, which captured extensive media coverage. We also recognized the terrific work of CFPB Student Loan Ombudsman Rohit Chopra with a Woodstock Institute Community Investment Award.