December 2018

Minneapolis Children’s
Savings Accounts
Program Design
Recommendations

Prepared for the Minneapolis Youth Coordinating Board
By Lucy Mullany, Consultant

 Table of Contents
Executive Summary............................................................................................................... 3
Background......................................................................................................................... 4
Section 1: Program Purpose & Goals......................................................................................... 7
Section 2: Program Design...................................................................................................... 8
 

2.1 Program Management ............................................................................................ 9

 

2.2 Program Eligibility..................................................................................................10

 

2.3 Enrollment Method................................................................................................11

 

2.4 Savings Account Type & Structure.............................................................................13

 

2.5 Local Financial Institution Partner.............................................................................14

 

2.6 Incentives & Bonuses..............................................................................................14

Section 3: Program Implementation & Ongoing Management.......................................................15
 

3.1 Develop Partnership Agreements.............................................................................15

 

3.2 Establishing Program Rules......................................................................................15

 

3.3 Enrolling Participants.............................................................................................16  
3.4 Managing the Master Account.................................................................................16

 

3.5 Implementing Wrap Around Financial Capability Services.............................................17

 

3.6 Measuring Success.................................................................................................17

 

3.7 Ongoing Oversight & Guidance.................................................................................19

Section 4: Outreach & Engagement..........................................................................................20
Section 5: Program Budget.....................................................................................................21
Section 6: Funding.................................................................................................................23
Section 7: Future Considerations.............................................................................................24
Appendices
 

Appendix A: Logic Model..............................................................................................25

 

Appendix B: Detailed Timeline for the Build Year (2019)...................................................26

 

Appendix C: Community Feedback Guide........................................................................27

 

Appendix D: Public Policy Proposals...............................................................................29

Page 2

 Executive Summary
When a child is born, every parent has the greatest hopes for their future. They believe their child
will have opportunities that they did not have. They hope for a future that is safe, happy, healthy,
and prosperous. Yet for many parents, they all too quickly realize that their children face barriers of
entrenched racism, wealth inequity, and educational opportunity gaps.
In Minneapolis we want to nurture and sustain that early hope. We want all our families to believe in
their child’s future – to know that the City of Minneapolis is invested in and supporting their child from
birth to career. A Children’s Savings Account (CSA) program is a tool for creating and sustaining hope
families need to build a brighter future for their children and, in turn, a more equitable future for the
City of Minneapolis.
A CSA is a long-term savings account opened on behalf of a child. Through public and private
investments and contributions from family members, the account balance grows over time and the
funds saved support a child’s post-high school education or job training. When CSAs are combined with
other wrap around services and methods of engaging families in financial education, they have been
found to decrease health disparities, build financial capability skills, and improve educational outcomes.
The recommendations in this report focus on building a sustainable infrastructure on which the City of
Minneapolis can expand the impact and reach of these accounts. This includes the following key design
features:
•  Program Management: The program will be based within the Minneapolis Health Department
(MHD), in partnership with the Minneapolis Youth Coordinating Board (YCB). Additional
responsibilities may be contracted to local non-profit organizations.
•  Target Population: Accounts will be opened at birth for all children born to a Minneapolis resident,
to leverage the early impacts of a CSA program on maternal health and early childhood socialemotional development. The program will be phased in over two years, with the initial accounts
opened for targeted groups of children born to Minneapolis residents.
•  Enrollment: Children will be automatically enrolled in the program, with parents given the option
to opt their child.
•  Account: The seed and any incentives or bonuses will be held in an entity-owned omnibus 529
account on behalf of the child. A parent will need to open their own 529 account or savings
account to make contributions for their participating child.
•  Investments: Every child will receive an initial seed deposit of $50. Children from a low-income
household will receive an additional initial seed of $50. Throughout the course of the program
additional incentives or bonus investments will be available to low-income children.
The recommendations laid out in this report aim to build a CSA program in Minneapolis that will
address existing inequity. While a CSA alone will not close the racial wealth gap or the education gap, it
provides children with a vehicle to build wealth and access financial and educational institutions they
may not otherwise have had the opportunity to participate in. Through the creation of a CSA program,
Minneapolis has an opportunity to integrate with existing cradle to career goals and efforts to support
family financial well-being.
Page 3

 Background
In Minneapolis, we believe all children should have the opportunity to reach their full potential.
Additionally, the future success of our city depends on the well-being of our residents and the ability
of our youth to become successful adults in the workforce. Unfortunately, too many children in
Minneapolis face seemingly insurmountable barriers that are a result of entrenched wealth disparities.
Financial Well-Being Inequity
A good measurement of financial health is the liquid asset poverty rate. It measures a family’s ability
to withstand even a small financial emergency (i.e. does the family have enough liquid savings to live
above the poverty level for three months in the absence of income?). In Minneapolis, one in four white
households are liquid asset poor compared to two in three households of color. Overall, 17.4% of white
households have zero net worth compared to 34.7% of households of color.1 Additionally, 17.4% of
white households in Minneapolis are unbanked2 or underbanked3 compared to 52% of households of
color.4
Early Educational Outcomes Inequity
We can also see inequity when we look at educational outcomes in Minneapolis. Disparities begin early
with math and reading scores. By the third grade white students outscore students of color in math
proficiency and reading proficiency:
MCA 2018 Proficiency Rates for Third Graders5

Math
Reading

White

American
Indian

Hispanic

African
American

Asian

82%
76%

25%
14%

33%
23%

27%
21%

46%
41%

Identifying
with 2 or more
groups
55%
49%

Higher-Education Attainment Inequity
These disparities continue into high school and beyond. In 2017, white students at Minneapolis Public
Schools (MPS) had an 86% graduation rate, compared to 56.7% among African American and Latino
students, and 31.1% among American Indian students. These disparities continue into 4-year college
completion. In Minneapolis 59.5% of white students complete a 4-year college degree by the age of 25
compared to an average of 15% among African American, Latino, and American Indian students.6
1. Prosperity Now 2018 Scorecard. https://scorecard.prosperitynow.org/
2. Households with neither a checking nor savings account.
3. Households that have a checking and/or a savings account and have used non-bank money orders, non-bank check-cashing services,
non-bank remittances, payday loans, rent-to-own services, pawn shops or refund anticipation loans (RALs) in the past 12 months.
4. 2015 FDIC National Survey of Unbanked and Underbanked Households. Washington, DC: Federal Deposit Insurance Corporation, 2016.
5. https://insights.mpls.k12.mn.us/SchoolBoardPortal/mca.html
6. https://insights.mpls.k12.mn.us/SchoolBoardPortal/graduation.html

Page 4

 Health Inequity
Given the impact that financial stress has on a person’s overall health, it’s important to also look at
health dispartities. According to the Minneapolis Health Department7:
•  More than half of Minneapolis births, or about 3,000 per year, are to low-income mothers (those
receiving WIC or Medicaid). 86% of these were births to mothers of color.
•  Infant mortality rates are much higher among black infants. In Minneapolis American Indian and
black infants die at three times the rate of white infants .
•  The top two risk factors facing pregnant women enrolled in the Minneapolis Health Department’s
home visiting programs were housing instability and lack of social supports.
Addressing Inequity with Children’s Savings Accounts
People of color, including indigenous peoples and recent immigrants, make up the fastest-growing
segment of the Minnesota population. Yet people of color in Minnesota are more likely to live in poverty,
less likely to graduate from high school, less likely to own a home, more likely to be unbanked, and
more likely to suffer major health challenges. With growing populations of color, the future economic
success of Minneapolis depends on everyone having the opportunity to reach their full potential. As a
city, we must begin to look at how we help children, from birth to early adulthood, acquire the skills and
gain access to institutions needed to build wealth and sustain wealth over the course of their lifetime.
Children’s Savings Accounts (CSAs) can help achieve this.
A CSA program creates the infrastructure that the City of Minneapolis and our families can use to build
wealth. A seeded savings account is a vehicle for future savings and, when more public and private
funds are allocated, larger and more long-term savings. Over the past ten years, states, counties,
municipalities and nonprofit organizations have developed CSA programs as an effective tool for
addressing an array of issues including college access and completion, maternal and child health,
financial capability, and workforce development. Ranging from small programs serving children at one
school to statewide initiatives, most of these programs focus on helping children access post-secondary
education by building both their savings and their educational aspirations, particularly for students from
low- and moderate-income families. At the end of 2016 there were 42 CSA programs serving 313,000
children in 30 U.S. states.
While still a relatively newer field, we are beginning to see the impact of CSA programs in communities
across our country:
•  Health & Well-Being of Families: Low-moderate income mothers whose children receive a CSA
at birth have reduced maternal depression symptoms. In turn, their children score higher on
early social-emotional measurements then their peers.8
•  College-Bound Identity: Youth participating in a CSA program are more likely to plan to attend
college after high school.9 Students who expect to attend post secondary education are more
likely to do so when they have dedicated school savings.10

7. 2018 Health Highlights, Minneapolis Health Department. http://www.minneapolismn.gov/www/groups/public/@health/documents/
webcontent/wcmsp-208889.pdf
8. Huang, J., Sherraden, M., & Purnell, J. Q. (2014). Impacts of Child Development Accounts on maternal depressive symptoms: Evidence
from a randomized statewide policy experiment. Social Science & Medicine, 112, 30–38. doi:10.1016/j.socscimed.2014.04.023
9. Long, B. T., (2016). The Impact of Parent Engagement on Student Outcomes: Analysis of the FUEL Education Model. Boston, MA:
Inversant.
10. Elliott, W., Song, H. A., & Nam, I. (2013). Small-dollar children’s saving accounts and children’s college outcomes by income level.
Children and Youth Services Review, 35(3), 560-571. doi:10.1016/j.childyouth.2012.12.003

Page 5

 •  Early Academic Success: CSAs can have an impact on early academic achievement in grade
school, including positively impacting math and reading scores.11
•  College Enrollment & Completion: Children with a college-saver identity and $500 or more
saved are two times more likely to graduate from post-secondary education than children with a
college- bound identity only. For children in low and moderate-income households, this figure is
three times more likely.12
•  Long Term Financial Health: CSA programs connect families with mainstream financial
institutions that can foster greater overall financial health. Additionally, programs that include
youth financial education are associated with increased financial capability among elementary
school students that will continue to develop into adulthood.13, 14
Growing wealth inequity is one of the biggest threats facing our childrens’ future. While a CSA alone
will not close the racial wealth gap, it provides children with a vehicle to build wealth and access
financial and educational institutions they may not otherwise have had the opportunity to participate in.
Minneapolis has an opportunity to build an equitable CSA program that integrates with existing cradle
to career goals and efforts to support family financial well-being.

11. Elliott, W., Kite, B., O’Brien, M., Lewis, M., and Palmer, A. (2016) Initial Elementary Education Finding From Promise Indiana’s Children’s
Savings Account Program. Lawrence, KS: University of Kansas, Center on Assets, Education, and Inclusion.
12. Elliott, W. (2013). Small-dollar children’s savings accounts and children’s college outcomes. Children and Youth Services Review, 35(3),
572-585. doi:10.1016/j.childyouth.2012.12.015
13. Sherraden, M. S., Johnson, L., Guo, B., & Elliott, W. (2011). Financial Capability in Children: Effects of Participation in a School-Based
Financial Education and Savings Program. Journal of Family and Economic Issues, 32(3), 385-399.
14. Huang, J., Nam, Y., & Sherraden, M. S. (2013). Financial knowledge and Child Development Account policy: A test of financial capability.
Journal of Consumer Affairs, 47, 1-26.

Page 6

 Section 1: Program Purpose & Goals
Over the course of 2018, the Minneapolis Youth Coordinating Board convened the Minneapolis
Children’s Savings Account Working Group, comprised of community, municipal, county, and public
school stakeholders. Together they developed the following vision statement, values statement, and
goals, which served as the guiding principles for developing theses program recommendations.
Vision Statement:
All Minneapolis young people, regardless of circumstances, will have raised aspirations for their future
and gain greater access to postsecondary education and job training due to our community’s investment
in their future.
Values Statement:
Kids and families are the foundation of our work. Our Children’s Savings Account program will build a
more equitable city and create opportunities for education and training after high school. Our work will
be inclusive, equitable, sustainable and transparent.
Program Goals:
1.  Establish a college-going identity among Minneapolis youth and families, where every child
believes they can go to college and succeed.
2.  Increase the number of Minneapolis youth who enroll in and complete college and/or career
training programs post-high school.
3.  Increase family financial capability for all Minneapolis families, by creating opportunities for
lifelong savings habits and removing barriers to accessing safe, mainstream, financial products.

Page 7

 Section 2: Program Design
While all CSA programs share the same basic attributes (i.e., providing long-term savings accounts with
incentives to build savings for an asset, such as postsecondary education), program design features are
customized to meet the needs and goals of each community. The program design laid out in this section
is based on feedback from the Minneapolis CSA Working Group, research and learnings from the
broader CSA field, and the Minneapolis Youth Coordinating Board. It is guided by the vision, values, and
goals laid out in Section 1.

Program Design Snapshot:
Program Management: The program will be based within the Minneapolis Health Department
(MHD), in partnership with the Minneapolis Youth Coordinating Board (YCB). Additional
responsibilities may be contracted to local non-profit organizations.
Target Population: Accounts will be opened at birth for all children born to a Minneapolis resident, to
leverage the early impacts of a CSA program on maternal health and early childhood social-emotional
development. The program will be phased in over two years, with the initial accounts opened for
targeted groups of children born to Minneapolis residents.
Enrollment: Children will be automatically enrolled in the program, with parents given the option to
opt their child out.
Account: The seed and any incentives or bonuses will be held in an entity-owned omnibus 529
account on behalf of the child. A parent will need to open their own 529 account or savings account to
make contributions for their participating child.
Investments: Every child will receive an initial seed deposit of $50. Children from a low-income
household will receive an additional initial seed of $50. Throughout the course of the program
additional incentives or bonus investments will be available to low-income children.

Every newborn is automatically enrolled in the program.
Funds are invested in a 529 College Savings Plan to support the
child’s future success.
Every account is seeded with $50. Low-income children recieve
an additional $50 and access to incentives and bonuses.
Over the course of 18 years the family is connected to college
readiness and financial capability resources.
The savings account serves as a central tool for our community to
invest in every child and build a more equitable Minneapolis.

 2.1   Program Management
The program staff manages the overall implementation and operations of the CSA program. Key
responsibilities include:
•  Facilitating participant enrollment and account opening
•  Developing program policies and procedures
•  Conducting marketing and outreach campaigns
•  Tracking account activity
•  Managing incentives and bonuses
•  Creating and managing partnerships
•  Reporting to accountholders, funders, and other stakeholders
•  Coordinating distribution of savings for post-secondary education
Some of the responsibilities of the program staff, listed above, will be shared with partners, as described
in the sections below. As needed, additional program responsibilities may be contracted out to
organizations and individuals.
The Minneapolis CSA program will be housed with the Minneapolis Health Department (MHD). When
the program is fully phased in, anticipated program staffing includes a full-time program manager and
a program coordinator. The Program Manager will will manage program operations and work with
partners and the program coordinator will provide programmatic support and manage the program
database. However, during the build year (2019) the program manager will be housed with the YCB and
will coordinate with MHD. During this year, the program manager will focus on building the program
infrastructure and developing sustainable partnerships. The YCB has led the CSA Program exploration
work for the past two years. They are poised to build the program infrastructure in 2019 and work
collaboratively with MHD prior to launch.
Placing the CSA program long-term within MHD will ensure that the city is placing family financial
capability as a key priority in the overall well-being of all families. MHD is committed to improving the
health outcomes of all Minneapolis families. They have a record of successfully providing programs,
beginning at birth, to underserved and at-risk families. A CSA program could be strengthened by their
existing relationships with families and their current infrastructure that supports new parents from
lower-income households.
Likewise, a CSA aligns with their goal of improving health outcomes. A recent brief by the Asset Funders
Network15 presents a full discussion of the relevant literature and offers a set of recommendations
for approaches that support both wealth and health from cradle to retirement. Among the
recommendations of the report are a set of strategies “across the life course” that they recommend
foundations invest in to improve the health of people living in poverty. To support the health of infants
and toddlers the report recommends supporting:
Home visiting programs that incorporate financial coaching. And Child Development Accounts (of which
college savings accounts are one type) promoted alongside preventive health and evidence-based early
childhood development programs.
Incorporating Minneapolis CSAs into MHD’s home visiting programs (including Healthy Start, NurseFamily Partnership, and Healthy Families America) could do just this.
15. Asset Funders Network (March 2017). The Health and Wealth Connection: Opportunities for Investment Across the Life Course

Page 9

 2.2   Program Eligibility
Beginning to save young allows for the promotion of postsecondary educational expectations at an early
age, before children have begun to form ideas about their future. Furthermore, building a universal and
automatic program ensures that nobody is left out.
Ideally, Minneapolis would automatically open up accounts for every child born to a Minneapolis
resident. However, the city of Minneapolis cannot currently access all birth records. According to
Minnesota statute,16 the birth record of a child born to an unmarried mother is automatically private.
We believe the city can gain access to that data via a data exception for the Minnesota Department of
Health or a legislative change, see Appendix D for more details.
A disproportionate number of births to unmarried mothers are from African American and low-income
households. The program could open accounts at birth for all children born to married couples and
then make every effort to “opt-in” children born to unmarried mothers. However, this would likely
expand inequity. Rather the program will initially target a small group of babies born into low-income
households until all birth records can be accessed. The program will phase in over two years to build a
strong program infrastructure while working to gain access to all Minneapolis resident birth records.
This will ensure that we build a sustainable and equitable program.
Beginning in 2020, the program will coordinate with existing programs within MHD that work with
underserved families during the first year of the child’s life. During the pilot years, accounts will be
opened automatically to children participating in the selected pilot programs. It will be important that
the programs selected can provide the required data to automatically enroll children so this feature can
be tested. Once the city gains access to all birth records, the program will begin enrolling all children
born to all Minneapolis resident. When the program is fully phased in, every child in born after the
launch date to a Minneapolis resident will be automatically enrolled.
Finally, due to the fact that about half of all Minneapolis Public School (MPS) kindergarten students
were not born in Minneapolis, the program will provide a secondary enrollment opportunity for
those children. Children that move to Minneapolis prior to the completion of their kindergarten year,
and born after the program launch date, will be automatically enrolled when they complete an Early
Childhood Screening, which are required of all kindergarten students. They are performed by MPS and
usually occur between the ages of three and five.

16. Minnesota Statute Section 144.225

Page 10

 Proposed Phased-in Launch:

Phase 1
Pilot
2020

Phase 1 Eligibility:
Born in 2020 to a Minneapolis resident and enrolled in one of the
following programs:
•  Healthy Start (Minneapolis Health Department)
•  Northside Achievement Zone

Phase 2 Eligibility:

Phase 2
Pilot
2021

Born after 2020 to a Minneapolis resident and enrolled in one of the
following programs:
•  Healthy Start (Minneapolis Health Department)
•  Northside Achievement Zone
•  Longfellow High School Teen Parent Program
•  Nurse-Family Partnership (Minneapolis Health Department)
•  Healthy Families America (Minneapolis Health Department)

During the 2019 build year and pilot phases, the Minneapolis Youth Coordinating Board, the Minneapolis
Health Department and other partner will make efforts to gain access to all birth records. If the City of
Minneapolis cannot gain access to all birth records, it is recommended that the program remain targeted at
families that could benefit the greatest from a CSA rather than trying to build a universal program that may
inadvertently leave some families out.
Full Launch Eligibility: (Assumes access to all birth records was granted)

Full Launch
2022

Meets one of the following:
•  Born on or after January 1, 2020 to a Minneapolis resident
•  Born on or after January 1, 2020 and completed a Early Childhood
Screening with Minneapolis Public Schools.

Recommended Pilot Groups:
As described above, we are recommending the following pilot groups:
•  Healthy Start: Minneapolis Healthy Start provides intensive, in-home case management services
to pregnant women who are at risk for poor birth outcomes. Services continue for up to two
years post-partum. They serve about 250 babies each year.
•  Northside Achievement Zone: NAZ is a non-profit based in North Minneapolis. They aim to build
a college going culture with low-income families, including their College Bound Babies program
that works with parents of children up to three years of age.
•  Longfellow High School Teen Parent Program: Longfellow High School is a district-wide
alternative school program of the Minneapolis Public Schools and Teen Adolescent pregnancy
Page 11

 and Parenting (TAPP)Program. The school works to promote generational self-sufficiency among
pregnant and parenting teens.
•  Nurse-Family Partnership: Nurse-Family Partnership works by having specially trained nurses
regularly visit young, first-time moms-to-be, starting early in the pregnancy, and continuing
through the child’s second birthday.
•  Healthy Families America: Healthy Families America designed to work with families who are
at-risk for adverse childhood experiences Services begin prenatally or soon after the birth of
a baby. HFA goals include building community partnerships to engage families in home visiting
services, strengthening parent-child relationships, promoting child growth and development and
enhancing family functioning by building protective factors.
Additional Pilot: CSA programs across the country, especially those that open accounts when the child is
born, focus heavily on engaging the child’s mother. Given that the Minneapolis Health Department has
had successful outcomes when engaging fathers through their Focus on Fathers project, we recommend
that Minneapolis explore leveraging this expertise to simultaneously pilot a CSA program that focuses
on the father’s engagement during phase 1 and phase 2 of the program. Outcomes from this pilot could
help further the national CSA field’s base of knowledge

2.3   Enrollment Method
A child born to a Minneapolis resident will be automatically enrolled in the CSA program, meaning that
an initial deposit will be invested in an account on their behalf without the children or their parents
taking any action. Parents will receive notification before their children are enrolled and will have
the opportunity to opt their children out. Birth record data from the office of vial records with the
Minnesota Department of Health will be used to initiate enrollment, as described in more detail in
Section 3.3.
Research shows that when CSA programs are opt-in, parents with more education and financial savvy
are more likely to sign their children up for the program. Children from lower-income households—
who may stand to benefit the most from the accounts—tend to be left out. By automatically enrolling
children, the Minneapolis CSA program will ensure that children are able to participate, regardless of
household income or other characteristics.
There will be a second opportunity to automatically enroll in the program for children that move
to Minneapolis prior to first grade. Working with Minneapolis Public Schools (MPS), children that
complete an Early Childhood Screening can be automatically enrolled in the program, as described in
more detail in Section 3.3
During Phase 1-2, described in Section 2.2, partner initiatives will share participant data with the
program. Those participants will be automatically enrolled in the program. Parents will receive
notification before their child is enrolled and will have the opportunity to opt-out.

Page 12

 2.4  Savings Account Type & Structure
The CSA program will use Minnesota’s 529 college savings plan, Minnesota College Savings Plan, which
is managed by TIAA, as the account vehicle. A 529 plan is a college savings plan that offers tax and
financial aid benefits. Funds saved in a 529 plan can be used for qualified education expenses, such as
tuition, fees, books, and room and board. The funds can be used at any eligible educational institution
- generally any college, university, vocational school, or other postsecondary educational institution
eligible to participate in a student aid program administered by the U.S. Department of Education.
The program, in coordination with the City of Minneapolis and MHD, will open an omnibus 529 account.
The initial deposit, incentives and other bonuses provided to participating children will be held in the
master omnibus account on their behalf. The mastoer omnibus 529 account structure was selected for
the following reasons:
•  It allows for automatic enrollment. As entity-owner of the omnibus 529 account, the program
does not need to name beneficiaries or provide taxpayer identification numbers for enrolled
children.
•  It protects families from losing benefits due to asset limits. Since the program coordinator,
not the families, holds the incentive funds they do not count toward asset limits for public
benefits. This ensures that families will not lose their benefits as a result of their children building
educational assets.
•  It safeguards the incentives. Since the incentives invested on behalf of children are held in the
master account, the program can ensure that funds are only used for allowable postsecondary
educational expenses. In addition, if participants do not use the money by the designated age
limit, the funds can be reinvested back into the program, allowing it to be used to provide
incentives for other participants.
•  529 Plans already have the infrastructure. The Minnesota College Savings Plan has the
necessary infrastructure in place to build a CSA program. 529 plans were built to save for college.
The MN plan allows for the creation of an omnibus account to save for multiple beneficiaries and
has the ability to pay out the funds when the child is ready to go to school.
•  Scaleable: Because the MN College Savings Plan is a statewide program, the program could be
scaled countywide, across Hennepin county, when there is appropriate funding and capacity.
Parents will not be able to make contributions into the omnibus account. However, families can save in
their own account. The program will conduct outreach to families and provide assistance in opening a
family-owned 529 account or a savings account at a local bank or credit union that will allow them to
make deposits.
While it is administratively easier for all family-owned accounts to be with the Minnesota College
Savings Plan, some families, especially those that do not make financial transactions online, may prefer
to save with a financial institution that has a brick and mortars location in Minneapolis. Thus, during the
build year (2019), the program coordinator will oversee an RFP process for a local financial institution
to work with families to open their own college savings account. This will allow families the choice of
saving their own funds in a 529 plan or a savings account that has brick and mortar locations in the city
of Minneapolis. The selected local financial institution will coordinate closely with TIAA to ensure that
the family’s savings account can be linked with the city-owned 529 plan. Linking the accounts will allow
the program to send out statements on overall savings in both accounts and allow the family to see their
total savings when logging in to the program portal.
Page 13

 2.5  Local Financial Institution Partner
During the 2019 build year, the program manager should release a Request for Proposals for a local
financial institution partner. The selected financial institution will provide family-owned savings
accounts to those families who prefer to save in a traditional savings account rather than with the 529
Minnesota College Savings Plan. The seed and any bonus incentives for the child will remain the cityowned account with the 529 Minnesota College Savings Plan. However, any deposits from the family
will be placed in the family-owned account.
The City should prioritize the following key features when selecting a local financial institution partner:
•  Geographical Accessibility: does the financial institution have brick and mortar locations in
lower-income neighborhoods.
•  No Fees: can the financial institution provide a no-fee savings account for families
•  Language Accessibility: Can the bank provide services and materials in languages other than
English?
•  Flexibility: Is the financial institution willing to work closely with the Minnesota College Savings
Plan to ensure the family-owned account and city-owned account can be linked in on a user
interface platform.
•  Capacity: Does the financial institution have the capacity needed to build and maintain this
program long-term?
•  Community Trust: Does the financial institution have a good reputation with community
members?

2.6   Incentives and Bonuses
While the goal of the program is to inspire all Minneapolis children to strive for a bright future,
investments will be targeted toward low-income and underserved children. Every child will receive a
$50 seed deposit. Children from low-income households will receive an additional $50 seed for a total
of a $100 initial seed investment.
Additional incentives and bonuses can be added to the program, however, we recommend that any
additional incentive or bonus align with the following guiding principles:
•  Build Equity: Some behavioral benchmark incentives (i.e. school attendance, reading scores,
amount saved) tend leave out the children most in need. Rather, it may be more equitable to offer
bonuses at certain milestones – like a first birthday or kindergarten graduation.
•  Implement with Administrative Ease: Any bonus or incentive will require easy access to data so
they can be distributed accurately and automatically.
•  Increase Engagement: The more the parent and child are reminded that the account exists,
the more likely the program will have an impact on the child’s college-going identity. Bonuses
for checking your account balance or attending a financial education workshop can incentivize
engagement.
All incentives will be held in the city-owned account until children are ready to use them for
postsecondary education. If participants do not use the funds by a certain age (to be determined), the
incentives will be rolled back into the program to provide incentives for other children.
Page 14

 Section 3: Program Implementation & Ongoing Management
The following are key elements involved in implementing and managing a CSA program:
•  Developing partnership and data share agreements
•  Establishing program policies and procedures
•  Enrolling children
•  Managing the master account
•  Distributing incentives
•  Developing and implementing wrap around financial capability services
•  Measuring success
•  Building a process for ongoing oversight and program guidance
The sections below provide the framework for each of these elements. The program staff, along with the
program steering committee, will develop detailed processes and needed documents for each of these
elements before launching the program.

3.1  Developing Partnership Agreements
One of the first steps the program will take to prepare for program launch is to develop partnership
agreements with the Minnesota College Savings Plan / TIAA, Northside Achievement Zone, Minneapolis
Public Schools, MHD and other identified partners. The agreements will include:
•  Mutually agreed-upon goals for the partnership
•  Roles and responsibilities for each organization
•  A management structure that ensures that each organization is meeting its stated goals and
responsibilities
•  A plan for communicating regularly to check in on progress and troubleshoot issues
•  Legal and compliance issues, such as data usage and applicable data privacy regulations
•  Financial details, such as any fees, in-kind donations, or other monetary and non-monetary
support provided to partners (if applicable).
After the agreements are in place and implementation has begun, the program coordinator will hold
regular meetings with partners to ensure that operations are running smoothly and that all parties are
meeting the expectations laid out in the agreement.

3.2  Establishing Program Rules
The program will develop a full set of program rules. Topics that will be addressed include, but are not
limited to:
•  Eligibility - Who is eligible for the program? What happens when a child moves out of the city?
What happens in the unlikely event of a participant’s death?
•  Enrollment process - What is the process for opting out?
•  Account - What account features are important for the program’s target participants? How
will participants interface with the account? How will families recieve their account balance
information?
Page 15

 •  Incentives and/or bonuses - what incentives/bonuses will drive family engagement?
•  Use of funds - how and when can families make withdrawals, if any? Is their a time limit for using
the funds?

3.3  Enrolling Participants
Children will be automatically enrolled in the CSA program, as described in Section 2.3. The process for
enrollment will be:
Phase 1-2 Pilot: The pilot partners identified for the first two phases of the program will send a data file
to the program coordinator every quarter with list of babies born that year and newly enrolled in the
program. The file will contain the following information:
•  Child’s name
•  Date of birth
•  Mother’s name (or guardian)
•  Address
•  Contact information for the child’s parent or guardian
•  Hospital of birth (if possible)
•  Income indicator (if possible)
Full Launch: During this phase, the data file will include the above information. For children that are
enrolling via an Early Childhood Screening, it will also include their MARSS number.
Once the program recieves the data files:
•  The program coordinator will transfer information for each child from the data file to the
program database.
•  The program coordinator will send a notification via mail about the program to the parent or
guardian of each child. Parents/guardians will be given a period of time (to be determined) to
opt their child out of the program. If parents do not opt out during that period, the child will be
automatically enrolled in the program.

3.4  Managing the Master Account
Account Set-Up
The program coordinator will work with Minnesota College Savings Program / TIAA to open a master
529 omnibus account to hold incentives on behalf of enrolled children. The Minnesota College Savings
Program and TIAA will not receive the names and contact information of the children enrolled in the
program; rather, from the standpoint of the Minnesota College Savings Program and TIAA, the account
funds will be held by the city on behalf of unnamed beneficiaries.
The best option for program sustainability, public trust and understanding, and overall program
communications is for the city to play the role of the account custodian. However, in the event that
the City of Minneapolis determines that it cannot serve as the account custodian, the program should
identify a third party entity, preferably a foundation with a long history of investment in Minneapolis,
to serve as the account custodian. Partnership and datashare agreements between the city and the
account custodian should be established.
Page 16

 Account Tracking
Working with TIAA, the program coordinator will utilize their outcome tracker, VistaShare, to track
account activity, distribute incentives/bonuses, and manage data. The program coordinator will
determine what, if any, additional services will be contracted with VistaShare.
Using the information in the database, the program staff will compile and mail a statement for each child
to his or her parent or guardian on a quarterly or biannual basis that shows the value of the child’s funds.

3.5  Developing & Implementing Wrap Around Financial Capability Services
When the program launches, financial capability efforts should be focus on providing support to the
child’s parents/guardians. This will ensure that the program incorporates a two-generational approach
to family financial health. Minneapolis should leverage its existing nonprofit community already
providing these services. Many organizations provide one-on-one financial coaching, credit building, tax
preparation, connections to safe banking, and asset building services. The lead partners in Minneapolis
include:
•  Prepare and Prosper has expanded its tax services to offer financial coaching and products to
clients. It also leverages technology in interactions with clients during coaching. Prepare and Prosper
recently partnered with Sunrise Banks to launch FAIR - a package of safe financial products for their
clients.
•  Build Wealth MN has baked financial capability in their wrap-around services to serve families,
offering targeted guidance and access to financial products.
•  CommonBond Communities has embedded financial coaching and access to innovative credit
building products in its housing services.
•  CLUES is a partner of LISC and has a Financial Opportunity Center on site, offering bundled services
to address financial needs of its clients. CLUES is leveraging social networks and offering a lending
circle credit building loan with the Mission Asset Fund.
•  Lutheran Social Services offers wrap-around services to low income families and has made financial
health core to its programming. Its Eastside Financial Center offers financial service, alongside its
signature financial coaching and counseling. They will be one of several Prepare & Prosper partners,
offering the FAIR products next year.
The Minneapolis CSA program should consider providing grants to a number of partners that will
provide services to participating families that are most in need of financial capability services and
trainings. Additionally, as the program expands and children age, the program should look to existing
financial curriculum’s to incorporate into the program. These include curriculum created by the
Consumer Financial Protection Agency, the FDIC, and the Federal Reserve Bank.

3.6  Measuring Success
Since it will take more than 18 years to see the ultimate results of the CSA program—more Minneapolis
children completing postsecondary education—additional research should be conducted to identify
measures of short- and medium-term success. Reaching these short- and medium-term outcomes will
indicate that the program is on track to reach its goals. Potential short- and medium-term measures of
success include the following:
Page 17

 Goal 1: Establish a college-going culture among youth and families
•  Short-term: Increase in families’ expectations for their children’s postsecondary education
•  Medium-term: Students develop a “college-bound” identity, in which they see themselves as
continuing to postsecondary education (e.g., college or technical training) after high school
Goal 2: Increase postsecondary educational attainment
•  Short-term: K-5 and first grade attendance rates improve
•  Medium-term:
  - Improvement in reading skills
  - High school graduation rate increases
Goal 3: Improve financial capability
•  Short-term: More students have savings set aside for postsecondary education
•  Medium-term:
  - More families saving for postsecondary education in a separate, family-owned account
  - More families are able to navigate the college financial aid system and complete the FAFSA
 
- All children complete age-appropriate, experiential financial education to build their financial  
 
capability
 
- More families access wraparound financial capability services, such as financial coaching and
 
free tax preparation, that improve their financial security
The program will track progress toward these outcomes, with support from partners, and will make
adjustments to the program as needed to ensure that the outcomes are achieved. The table below
describes the data sources for tracking many of the key short-, medium-, and long-term outcome
measures. Several of these measures are already tracked by MPS. The agreements with schools should
include an arrangement to share needed data points with the program at appropriate intervals.
Data Sources for Select Outcome Measures
Outcome Measure
Attendance rate
Children with savings fro college
Children and families’ postsecondary education
expectations
Standardized test scores
High school gradution rates
Postsecondary enrollment
Postsecondary completion

Data Source
MPS
Program Database
Surveys of children and parents/guardians
MPS
MPS
National Student Clearinghouse
National Student Clearninghouse

Selecting an Evaluator
To ensure that an effective program evaluation process is built into the design of the program, the
program should identify researchers that can serve as key advisors during the build year (2019). While
the program could issue an RFP to select a program evaluator, we recommend that the early in 2019 the
program staff host a meeting with some of the key CSA researchers in the field, including Dr. William
Elliott from the Center for Assets, Education and Inclusion (AEDI), Margaret Clancy from the Center for
Page 18

 Social Development, and key researchers from local institutes of higher education. This meeting should
focus on identifying the evaluation needs and potential partners that can serve as program evaluators.
The estimated budget in Section 5 includes funding for research and evaluation. However we
recommend that an initial meeting with key researchers in the field is conducted in early 2019, to
determine the best path for selecting an evaluator and evaluation needs.

3.7   Ongoing Oversight & Guidance
A steering committee should be created to provide ongoing guidance and feedback to the CSA program.
The steering committee members should represent key government agencies, community organizations
that serve underrepresented individuals, higher education, the funding community and other key
stakeholders that could provide unique insight into the program operations. During the 2019 build
year, the program should work with MHD and the YCB to form the committee and create committee
guidelines. We recommend that the committee meet monthly during the build year and at least
quarterly moving forward.
The Steering Committee could include representatives from:
 
Minneapolis Youth Coordinating Board
 
Minneapolis Health Department
 
Minneapolis Housing Authority
 
Minneapolis Mayor’s Office
 
Minneapolis Public Schools
 
Hennepin County
 
Northside Achievement Zone
 
Local Foundations
 
Financial Empowerment and Asset Building Organizations (See Section 3.5)
 Hospitals
 
TIAA (Minnesota College Savings Plan)
 
Minnesota Office of Higher Education
 
Program Evaluators / Researchers
 
Parents representing traditionally underserved communities
 
 

Page 19

 Section 4: Outreach & Engagement
In order to help build the college-going culture in the community, connect families to financial capability
services, and encourage them to save for postsecondary education, the Minneapolis CSA program
coordinator will dedicate significant time and effort to conducting outreach to promote the program.
An outreach strategy will be developed to promote the benefits of the program to children and their
families, along with information on how to receive program incentives. The program staff will promote
the CSA program through prenatal programs, hospitals, home visiting programs, early education
efforts, and Early Childhood Screenings. Outreach activities will range from low-touch activities such
as including a message about the program in existing materials received by new families, to highertouch activities, such as hosting education events or fostering opportunities for families to connect with
others who are saving.
Examples of outreach and engagement include:
•  Informing and engaging multiple levels at MHD, MPS, and other agencies. In order to ensure
understanding of the program and get staff buy-in, information sessions and meetings across
agencies to build the number of program spokespeople.
•  Training parent coordinators. Parent coordinators can be trained and equipped with information
to distribute on the program on a regular basis. Distribution channels include flyers, newsletters,
websites, and text messages.
•  Distributing information at family-centric events (Early Childhood Family Education, Head
Start, etc.). CSA outreach staff and volunteers will attend enrollment fairs and family forums to
tell families about the program and address any questions they have.
•  Hosting CSA family nights. The CSA program coordinator can host periodic family nights
focused on the program. Financial education lessons can be paired with CSA information at these
sessions.
•  Hennepin County Outreach: Hennepin County provides regular communication to parents in
the first two years of their child’s life through the Baby Tracks program. CSA information could be
included with this outreach.
In Minneapolis, there will be many opportunities for community groups and businesses to be involved.
Community partners and businesses can host information sessions, distribute information, or provide
financial or non-financial supports to savers and their families.

Page 20

 Section 5: Program Budget
The budget for the Minneapolis CSA program reflects the program design, program management, and
outreach activities outlined in Sections 2, 3, and 4. The two components of the CSA program budget are:
•  Program delivery
•  Seed and Incentives
Program delivery costs refer to all the expenses incurred in managing, operating, and marketing the CSA
program. Key program delivery expenses include:
•  Personnel – The anticipated personnel for the program includes a full-time program manager
and a full-time program coordinator.
•  Database – This will cover the costs of customizing and licensing for the database system used by
the program to track enrollment, account balances, incentives, and indicators. Depending on the
payment structure for the selected database system, the cost may be higher in the first year to
cover customization and decrease in subsequent years when only licensing fees are applied.
•  Supplies and materials – These include computers for program staff and general office supplies.
These costs will be higher in the first year, as new items are purchased for the program, and will
go down in subsequent years.
•  Outreach and marketing – Potential outreach and marketing expenses include welcome kits for
participants and families, program flyers and posters, giveaways (e.g., piggy banks, pens, t-shirts),
and event costs (e.g., refreshments).
•  Research and Evaluation – A program should contract with an evaluator during the build year so
that that evaluation tools can be built into the overall design of the program. It will be important
to maintain program evaluations that inform the growth of the program.

Program Delivery Budget (Estimated)
The program delivery budget assumes there will be a program manager (FTE) hired in the 2019 build
year. The personnel for the following three years (2020 – 2022) will include one program manager (FTE)
and one program coordinator (FTE).

Personnel
Program Operations
& Supplies
Total

Build Year (2019)
$100,000
$50,000

Year 1 (2020)
$160,000
$50,000

Year 2 (2021)
$164,800
$50,000

Year 3 (2022)
$169,744
$75,000

$150,000

$210,000

$214,800

$244,744

 

Page 21

 Seed & Incentive Budget (Estimated)
The seed and incentive budget estimates are based on the recommendation that the seed amount is $50
for every child born to a Minneapolis resident and $100 for children born into low-income households.
During the first two pilot years, all children enrolled in the program will be from low-income households.
The estimates for year three are based on the assumption that the City of Minneapolis will gain access
to all birth records. Thus year three estimates that there will be 6000 births with 23% of those to lowincome households.16 Additionally, we have provided an estimated budget for a potential incentive
bonus. This bonus would provide $25 to all low-income participants on their first birthday. This would
allow the program evaluators to test out how a bonus incentive impacts a family’s engagement with the
program and their own savings behavior.

Seed
Incentives
Total

Build Year (2019)
$0
$0
$0

Year 1 (2020)
$30,000
$0
$30,000

Year 2 (2021)
$50,000
$7,500
$57,000

Year 3 (2022)
$369,000
$125,000
$494,000

We have not included a budget for enrollment of children who complete an early childhood screening. The first
children would not be eligible for that until 2023, when the cohort from year 1(2020) turns three years old.

Total Budget (Estimated)

Total

Build Year (2019)
$150,000

Year 1 (2020)
$240,000

Year 2 (2021)
$271,800

Year 3 (2022)
$738,744

17. U.S. Census Bureau, 2012-2016 American Community Survey 5-Year Estimates.

Page 22

 Section 6: Funding
CSA program funding structures differ across the country. However, most municipal programs are a
combination of public and private funding. We recommend that the City of Minneapolis provide the
initial funding for the program infrastructure, identify corporate and philanthropic funds for the seed
and incentive funds, and identify a more sustainable public funding stream for future years.
Sources of funding to consider include:
Public Funding: The city budget should include funding for program staff and other program
infrastructure expenditures. Additionally, if allowed under the Minnesota Public Purpose Doctrine, we
recommend that the city identify a revenue stream that can help sustain the funding of the account seed
and bonus incentives. For example, the City of St. Louis uses revenue from parking meters to partially
fund their CSA program.
Philanthropic Funding: The program staff should secure private funding from local foundations,
national foundations, family foundations, and/or corporate donors. Focus should be placed on donors
that share a similar mission to the Minneapolis CSA program. This could include donors with a focus
on family financial security, college completion, the opportunity gap, racial equity and addresing health
disparities.
Reward Programs: The program coordinator should explore the opportunity to develop a sustainable
funding stream through the integration of a rewards card program or purchasing card (p-card) program.
Reward card integration with CSA programs is still a new concept, but early efforts indicate that it could
be a promising tool for increasing the account amounts. The Center on Assets, Education and Inclusion
(AEDI) is currently working with CSA programs across the country to evaluate the impact of reward
card program integration.18
Individual Donors: A number of CSA programs have leveraged interest from individual donors to raise
crucial funds for children. Donors are often particularly interested in funding incentives and bonuses
to help children grow their accounts. Some donors are also interested in “sponsoring” certain children
or a cohort of children from a specific community or school. Additionally, many CSA programs partner
with the 1:1 Fund, led by Prosperity Now. The 1:1 Fund is an online crowdsourcing platform specifically
designed for CSA programs that works with CSA programs to raise funds from individual donors during
quarterly campaigns.19
The Minneapolis CSA Program should develop a separate fund to accept philanthropic and other private
dollars. The City should work with a Minneapolis-based foundation to hold these funds. CSA programs
across the country have found that people are more likely to donate to a CSA fund that is held with a
reputable foundation rather than a public entity.
18. AEDI initial research findings on reward card programs: https://aedi.ssw.umich.edu/sites/default/files/publications/Lessons_Learned.
pdf
19. 1:1 Fund: https://www.1to1fund.org/

Page 23

 Section 7: Future Considerations
Sections 2 through 6 of this document lay out a recommended plan for the initial implementation of
the Minneapolis CSA program. As the program develops, the program and partners should consider the
following enhancements to further increase the program’s impact, including:
Universality: We believe that a universal program is ideal for making a city-wide culture change where
every child believes she or he will attend college. However, we believe that the City should reasses when
the universal acccount opening occurs after the first two pilot years. The City may find it is best to open
accounts at birth for all children born to a Minneapolis resident. However, the program should also
consider whether it’s best to open accounts automatically at birth for a targeted group and then open
them universally to all children completing an Early Childhood Screening. About half of all Minneapolis
kindergarten students were not born in the city. Opening accouts for all children during the Early
Childhood Screening will ensure that all kindergarten students have an account and decrease the
administrative burden of maintaining accounts for children that have left the city at an early age.
Adding benchmark incentives for older students. As participating children reach later elementary
school, middle school, and high school, additional benchmarks may be added related to important
milestones and activities for those grade levels. Ideas for these additional benchmark incentives include,
completing 6th grade, visiting a college and completing the FAFSA.
Tying the CSA program with other college access supports. Research indicates that CSAs are an
effective tool for building college expectations, which can make it more likely that a child goes on to
enroll in and complete postsecondary education. However, CSAs are most effective when paired with
other college access supports, such as college readiness programs, FAFSA completion support, college
and career counseling, and additional scholarship funds. Over the first few years of the program, the
program staff will work on creating strategic partnerships with college access and scholarship programs
in the community, so that students can be connected to these services as they move closer to college
age.
Strengthening connections to financial capability services for families. To enhance the linkage
between the CSA program and building parents’ financial capability, the program staff should explore
partnerships with community organizations that provide financial capability services, such as financial
education, financial coaching, access to banking products and services, and assistance with accessing
public benefits.
Scaling Countywide. With growing disparities across Hennepin County, the program should consider
expanding beyond the city limits. Given that accounts are opened at birth and the City is utilizing the
Minnesota 529 College Savings Plan, scaling is possible. Additionally, about half of all students leave
Minneapolis Public Schools by the time they reach 6th grade. Many of these students are likely moving
to surrounding suburbs within the county. A countywide effort would allow the program to continue to
serve these students.

Page 24

 Appendix A: Logic Model
Resources
CSA Program Staff
Established Home
Visitng Programs,
Communitiy
programs engaging
with new parents,
and MPS programs
engaging with new
parents.
Public & Private
Funding
Estblished
community partners

Activities
Automatically
enrolling newborns
& children competing
the Early Childhood
Screening
Providing initial
seed deposits an
ongoing incentives or
bonuses

Outputs
Number of children
with accounts
Number of families
saving
Number of
participants earning
incentives or
bonuses

Connecting
participants and
families to additional
support services

Number of families
engaging with the
program and the
account specifically

Engaging families
in financial
empowerment
opportuniiies

Number of children
and families
engaged in financial
empowerment
activies

Promoting messages
of college access and
college success

Short-Term
Outcomes

Mid-term
Outcomes

Long-Term
Outcomes

Increases in families’
expectations for
their children’s
postsecondary
education

Percentage of
students developing
a “college-bound”
identity increases

The percentage of
students from MPS
enrolled in postsecondary education
increases

K-5 and first grade
attendance rates
improve
More students have
savings set aside
for postsecondary
education

Improvement in
reading and math
skills
High school
graduation rates
increases, especially
among low-income
students and
students of color
More families have
recieved financial
education and can
navigate the college
applicaiton and
financial aid process

The percentage of
students from MPS
graduating college
increases.
Minneapolis
graduates contribute
to the long-term
economic health
of Minneapolis as
skilled workers.
Wealth inequity
decreases in the City
of Minneapolis

Page 25

 Appendix B: Key Actions for the 2019 Build Year
YCB hires a
Program Manager

Quarter 1
January March, 2019

Quarter 2
April - June,
2019

Quarter 3
July September,
2019

Quarter 4
October December,
2019

Research advisors
develop evaluation plan

Steering Committee is formed
& workplan approved

Initial meetings with
potential funders

Agreement on the account custodian &
data sharing process across agencies

Ongoing meetings with funders
and grant proposals submitted

Draft data share agreements &
MOUs reviewed

Marketing & communications
plan approved

Phase 1 & 2 of community
feedback guide completed

Draft outreach & educational
materials reviewed

Datashare agreements &
MOUs finalized
Secure public & private
funding for 2020 & beyond

Program rules
finalized

Work with TIAA to develop user
interface for account engagement
Public funding for
2020 requested

Testing & finalizing data tracking &
public interface tools

Distribute outreach & educational
material for 2020 launch

Work with TIAA & MN Office of Higher Education
on needed changes to the account platform

RFP Process for a local
bank partner executed

Collaborative efforts begin with
TIAA & local bank partner

Finalize all enrollment forms
& public interface tools

Begin developing marketing
& communications Plan

Advocate for acccess
to all birth records

Ongoing meetings with funders
and grant proposals submitted

Establish a fund to accept private
donations into the program

Conduct trainings for
program partners

Hire necessary staff for 2020

Note: Data files will be recieved quarterly from participating pilot programs. Because the program is enrolling babies born in 2020, the first data file will not be
recieved until Apri 1, 2020. Thus there is some additional time in 2020 to finalize any program elements before the first account is opened.

Page 26

 Appendix C: Community Feedback Guide
During the 2019 build year, it will be crucial to fully engage community members – particularly those
that will be directly impacted by the program. One opportunity is to engage families in one-on-one
conversations, focus groups, and/or community forums. We recommend that Minneapolis adopt a
method used by the Boston Saves program during their program design. They engaged families at three
different key phases during the program design & post-launch periods :

Phase One: Determine family financial behaviors and key needs
Method: This should be done in one-on-one interviews (rather than focus groups). This will allow for
more truthful conversations about very sensitive financial topics.
Questions to be answered include:
•  Current savings behaviors: account types, frequency of deposits
•  Desired savings behaviors: account types, frequency of deposits
•  Savings goals: saving for college, other goals, amount of savings desired
•  Attitudes about college: desire for children to attend, role of family in financing college, concerns
about college (financing and attendance)
•  Current financial concerns: How are families using benefits, what are their concerns around
long-term saving
•  Financial transactions in general: How much of a family’s financial transactions occur online?
Where do families bank? What non-traditional products are used? Who are the financial decision
makers?
•  Financial Education: Are parents talking to their children about financial education? Do they feel
comfortable providing money to their children? Do children save?
Selection Group: Individuals from different ethnic backgrounds, ages, genders, and income groups should
be selected - overweighting more vulnerable groups.
Output: Refined understanding of differences between groups, specific needs that should be addressed,
and perceptions of college, saving abilities, and financial position.

Phase Two: Determine Key Features
Method: Several Focus Groups across key demographics.
Questions to be answered include:
•  Account Type: Are there any key features or types that are preferable? Flexibility of account
usage needed.
•  Behavior Incentive: Do families have a strong preference on being rewarded for consistent
deposits, amount of deposit, opening an account, checking account balance, etc.? What bonuses
make the most sense?
•  Engagement Strategies: How would families like to find out about a CSA, what formats resonate?
Page 27

 •  Program Features: Are community-based programs and interactions of interest to participants?
How do families think about talking about college in their communities?
•  Restrictions: How do participants feel about ownership of accounts, withdrawal restrictions, loss
of match/prizes if accounts not used for college, etc.?
•  Technology: What technology do families use to bank? What apps do they use frequently?
Output: Key design features, participant facing platform, outreach plan

Phase Three: Follow-up after launch
Methods: One-on-one conversations or focus groups with participating families one year after the initial
pilot launch.
Questions to be Included:
•  Reactions to Program: What do participants like, what do participants not like, what are
participants most excited about, what program features could be improved?
•  Outreach: Frequency of outreach, types of marketing material needed, methods of interaction
Outputs: Refining the program to improve engagement
Additional Participant Research: In addition to the research outlined in phases one through three,
research could also be conducted around marketing, design, and communication. Specifically consumer
facing research is recommended around:
•  Product name
•  Images/marketing design
•  Developing welcome packages and FAQs
•  Final communication strategy

Page 28

 Appendix D: Public Policy Proposals
Ther are a number of state-level polices that could be changed to ensure a more effective CSA program
in Minneapolis. The program should aim to address the following policies:
1. Access to All Birth Records
Minnesota Statute Section 144.225 stimulates that the birth record of a child born to an unmarried
mother is automatically private. This prevents Minneapolis from automatically opening accounts to all
children born to a Minneapolis resident at the time of their birth. The City will need to gain access to
this data. This can happen via an exception from the Commissioner of the Minnesota Department of
Health. If an exception is not made there will need to be a legislative change. The change would need
to create an exception for this program or it would need to adjust the law so that all birth records are
public, regardless of the mother’s marital status.
2. Minnesota College Savings Plan – Administrative Changes
The Minnesota Department of Higher Education currently has a contract with TIAA to serve as the
Minnesota College Savings Plan Program Manager. That contract expires in 2019. Thus the Department
will be preparing a new contract with TIAA or another financial institution. This provides an opportunity
advocate for the following administrative changes:
•  Default Investment Type: The Minnesota College Savings Program currently offers numerous
investment options. Research has shown that inertia and indecision limit people’s ability to save
and invest. One way to stop this from happening is by creating a default investment type. This
option would automatically be selected for individuals when they enroll in the plan. If enrollees
want to select another option, they would have the ability to do so at any time. The ideal default
investment should be comprised of some type of age-based mutual fund that is invested more
conservatively as the designated beneficiary gets older and closer to college age. However,
individuals would be free to change the default investment to another option if they so choose.
Many states, including Nevada, Maine, Arkansas, Utah, and Alaska, utilize the default investment
type to facilitate enrollment. The Program Manager should provide a default investment for new
applicants.
•  Accepts ITINs: The plan needs to make it clear on the online application that they accept either a
Social Security Number or an Individual Taxpayer Identification Number (ITIN) from the account
owner and the beneficiary. This will be a key feature for the family-owned accounts
•  Low Fees: The Program Manager should have low fees to ensure that families are getting the
most out of their investment.
•  No Minimum Deposit: Minnesota College Savings Program currently has a minimum initial
contribution of $25 and a minimum subsequent contribution of $15 for direct deposits. For
lower-income families, especially families on a fixed income, being able to deposit smaller
amounts could make it easier for them to open college savings accounts and automatically
contribute as part of their monthly budget. The Program Manager should have no minimum
deposit requirement. States with no minimum deposit include Alabama, Colorado, Missouri,
Nebraska, South Carolina, and Utah.
Page 29

 •  Easy Deposit Options: Easy mechanisms for making deposits into college savings accounts is
a key feature that helps low-income families, who may not have regular access to electronic
banking, save for college. Unfortunately, the current Minnesota College Savings Program
does not provide many options for depositing funds. Parents can make contributions through
electronic bank transfers, electronic gift deposits from friends and family, or through a check that
is mailed to the investment firm.
Many state 529 programs are experimenting with alternative deposit options, including:
partnering with banks that have brick and mortar locations to accept deposits; accepting cash
deposits at schools; working with a no-fee prepaid cards that connect to 529 accounts; and,
offering Certificates of Deposit at local financial institutions that can be rolled over into a 529
account. Minnesota’s Program Manager should be willing to explore alternative deposit options
that meet the banking needs of low-income families.
3. Family Financial Security Policy – Legislative
In addition to administrative changes with the Minnesota College Savings Plan, there are some
legislative changes that the city could explore at the state level to make it easier for families to save and
build wealth. These legislative changes include, but are not limited to:
•  Asset Limits: Minnesota should remove the asset limit from the TANF program. Checking assets
is unnecessarily costly for the state and deters families from building much-needed savings.
•  Tax-Time Savings: Creating a default investment type will also allow the State to provide
enrollment opportunities at times when families are thinking about their finances, such as tax
time. With a refundable state Earned Income Tax Credit (or Working Family Credit) in Minnesota,
low-income families should be engaged at tax time to save a portion of their refund in a 529
college savings account. The Minnesota Income Tax Form should include an opportunity for
direct deposit of a parent’s (or other relative’s) tax refund into a child’s (or relative’s) 529 college
savings account. Furthermore, the Office of Higher Education should work with the Minnesota
Department of Revenue to allow families to open up a 529 college savings account through the
tax form. At the very least, Minnesota should have a split refund form (like federal tax form 8888)
to allow for partial investment of a refund into a savings account.
•  Targeted Match Program: Minnesota should create a matched-savings component to the 529
college savings program for lower-income families. Matched savings incentives encourage
savings by providing a financial match relative to the amount an individual saves. For every dollar
deposited into the account, a third party deposits additional dollars into the account. The match
ratio varies across programs, though often it occurs between a 1:1 and a 5:1 ratio. The third party
providing the match can limit how many additional dollars will be matched, either in total or per
year. Arkansas, Colorado, Kansas, Louisiana, Maine, Missouri, Nevada, North Dakota, Utah, and
West Virginia have matched savings as part of their 529 programs.

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