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California’s new college savings program to help millions of kids save for higher education

By Greta Serrin

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    SACRAMENTO, California (KCRA) — More than three million California students just received an automatic $500 investment for them to pursue a higher education, as the state created accounts to help kids save for college from the day they’re born.

The CalKIDS program launched by the state on Thursday is the nation’s largest college savings program and is aimed at helping low-income public school students across the state.

“The program is designed to, of course, help them kickstart their own savings. It’s really a seed amount, what we hope these monies will do is inspire these families to save money on their own and watch these monies grow over time. By the time they are old enough to go to college or pursue additional post-secondary opportunities, the money is there, hopefully, it’s grown and can be of use,” said Julio Martinez with the ScholarShare Investment Board.

The state said the point of the nearly $2 billion program is to encourage more kids to continue their education after high school.

“The message the state of California is sending to all children in California is that you too can pursue your higher education dreams and not let money become the only barrier that stops you from doing that,” Martinez said.

Who is eligible for the money? And how much will they get? Every child born on July 1 of this year can receive up to $100. Those currently in grades 1 through 12 are also eligible.

Eligible low-income school children will automatically receive $500. The state will add another $500 if the child is in foster care, and then another $500 if they’re experiencing homelessness.

How to see my CalKIDS account? Low-income students have to enter three pieces of information. You must have the student’s birth date, the county where they attend school and their statewide student identified. If you don’t have that, the school should.

How to register for CalKIDS funding? For babies born on July 1 or later, you can register online.

You need to enter their birth date, the county where they were born and the local registration number on the birth certificate.

When can you get the money? Students can withdraw the money once they are 17 years old to pursue college or a trade school.

The money can be used for tuition, books and other education-related expenses.

The state didn’t have a specific estimate on how much money students would have because it depends on the market and how long the money stays in the account.

Can parents contribute to their CalKIDS account? No, since this is a state-owned account, parents can not contribute.

But there are things they can do to increase the state investment for their child. For babies born July 1 or later, the state automatically deposits $25.

If parents register their child on the account, they receive another $25. And if you link a new or existing Scholar Share 529 account to the CalKIDS account, they can get another $50. All of that would get them to a $100 investment.

CalKIDS will also be sending notification letters to qualifying children and families with more information.

“California is telling our students that we believe they’re college material – not only do we believe it, we’ll invest in them directly,” said Governor Newsom in a statement on Thursday. “With up to $1,500, we’re transforming lives, generating college-going mindsets, and creating generational wealth for millions of Californians.”

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