Aimee and Christopher Dill with baby Avery.
The state of Connecticut wants little 6‑week old Avery Dill to go to college so much, officials are willing to sock away a hundred bucks in the bank just in honor of her being born.
If her parents match that state incentive deposit and save even $50 a month henceforth, in 18 years, when she becomes a freshman, she’ll have about $23,000 to pay those college bills.
That’s the hoped-for scenario for thousands of more Connecticut families of new babies. State officials painted that picture Thursday afternoon as they gathered at the Friends Center for Children in Fair Haven Heights to unveil the Connecticut Higher Education Trust (CHET) Baby Scholars program.
Babies and little kids heard about their financial future.
That’s a new initiative to encourage the families of the 30,000 or so expected newborns in the state each year to begin saving for college early.
Make that very early, like at birth.
The program also applies to adopted kids.
The program disbursements come “with no cost to the taxpayer,” said Nappier. The money was found in $4.4 million of what Nappier described as residual funds at the Connecticut Student Loan Foundation.
While little kids and their parents listened amid the bongo seats and play apparatuses at the center, Gov. Dannel P. Malloy and State Treasurer Denise Nappier explained details: When parents like Christopher and Aimee Dill apply, the state deposits $100 into a CHET Baby Scholars account. A second $150 goes in if the family or friends add at least $150 to the account.
Even if left unaugmented, that initial $400 grows to $1,350 in 18 years. A monthly contribution of $50 over 18 years, at an estimated 7 percent return, will yield the $23,000, said Nappier.
Of course the idea is to encourage monthly savings and to develop a culture of savings and investing in college education among families trying to cope with growing expenses all around.
“A student with a college savings account of any amount is seven times more likely to graduate,” said the governor.
A CHET college savings program, generically known as a 529 account, has been functioning in the state since 1997. Today there are over 100,000 accounts and over $2 billion assets, according to materials provided the press.
The Baby Scholars additional program is the first time the state is making initial deposits and matching deposits, adding up to $300 for each child.
The Dills, who live in Guilford, already have a CHET account for Avery’s 2‑year-old brother Brayden. Chris Dill, who is a physicians assistant at Yale-New Haven Hospital, said he and his wife, a New Haven school teacher, are able to deposit a couple of hundred a month for Brayden, and hope to do the same for Avery.
The Dill family was the first to file for the program and ceremonially presented the application to the treasurer.
She accepted.
Malloy, Harries, and Mayor Harp were praised for perching on bongo seats as they waited tospeak.
The program applies to all kids born after Jan. 1, 2014 and to adopted kids as well. Other incentive features include deducting all such contributions from state income taxes, and, beginning in the coming tax year, to be able to direct state tax refund to the Baby Scholars program in general or to a specific beneficiary.
One of the challenges is to get the word out. Superintendent of Schools Garth Harries said his staff discusses the CHET program with families in preparation for college and as early as orientation of kindergarten families. He described the Baby Scholars program as another “tool in the quiver” to promote college-oriented planning.
Friends Center Executive Director Allyx Schiavone suggested the applications be put in the welcome baskets for newborns at the hospital.
Both the CHET and the CHET Baby Scholars program are managed by TIAA-CREF Tuition Financing, Incorporated.
TIAA-CREF’s Pam McNulty estimated that the $4.4 million currently in the fund should last three or four years. Nappier said that she is hopeful that the fund will be replenished in the future, as needed.
For more information, go to this site or call 866‑3939.