We are in a student debt crisis. Our national student debt stands at around 1.75 trillion dollars. President Biden proposed a policy last year in the fall that would cancel $10,000 for non-Pell grant recipients and $20,000 for Pell grant recipients that are low income. It has been met with legal challenge after legal challenge since it was proposed and has been paused and unpaused more times than my non-lawyer brain can process. While this plays out the racial wealth gap that many low-income Californians experience grows wider.
Student debt and financial access to education are some of the many obstacles that communities of color face in our state. Student debt is a lifelong burden that impacts generational wealth. One study shows that after 20 years, Black borrowers still owe 95% of their original loans.
Last Fall, California launched a program called the California Kids Investment and Development Savings program (CalKids) that will invest in low-income students by providing an initial seed deposit for them to save for college.
All children born on or after July 1, 2022, can receive up to $100 in a college savings account. Additionally, eligible low-income public school students can receive up to $1,500 in a college savings account.
With so many other trends happening with higher education this is positive news for low-income communities and communities of color.
Many students rely heavily on loans to finance higher education due to sharp increases in costs for state and private universities. Whether it’s the culture of granting Wall Street size compensation to administrative positions like university presidents or the growing financial dependency of state universities on private donors rather than public funds, all these factors contribute to the priorities of higher education institutions.
It’s long past time we focused on making higher education affordable and accessible to all. CalKids is a strong first step in addressing the financial barriers many low-income Californians face when deciding to pursue higher education and all its costs beyond tuition, like housing, food, textbooks, and more. No one should go into debt to get a degree.