Thought Leadership Thursday
Addressing Challenges With Bold Ideas
Thought Leadership Thursday Article
As State Treasurers, we all know that student debt is at a crisis point in the United States, at $1.6 trillion, collectively.
There are no easy answers to solve this.
Nevertheless, I’m encouraged by the active role that State Treasurers play in better preparing families and future graduates for the postsecondary education expenses—529 college savings plans, financial education programs, and advocacy for smart policy that helps students succeed in the economy they’ve inherited.
Pennsylvania faces a unique challenge as home to some of the best colleges in the nation, but ranked at #2 in highest student loan debt per borrower.
Still, there are some bright spots in this evolving landscape.
Keystone Scholars is a new program in Pennsylvania that provides a $100 starter deposit into a PA 529 account for every baby born or adopted in Pennsylvania, without using taxpayer dollars.
It began as a pilot program in 2018 and, with the bipartisan support of the Pennsylvania General Assembly and Governor Tom Wolf, expanded statewide on January 1, 2019. We worked with highly-specialized researchers to study the pilot program and evaluate the impact it has had on recipient families.
What we found was astounding.
Overall, families in pilot counties were twice as likely to open a PA 529 account as families in non-pilot counties within the first year of their child’s life. The Keystone Scholars pilot program also led to PA 529 ownership across a more diverse group of families, including for all racial and ethnic groups, across varying levels of parental education and income.
That means there are twice as many families taking the active step to start savings—as early as possible.
It takes bold ideas to begin addressing some of the most complex issues of our time. Often, it also takes collaboration and partnership across states and party lines to see the change we envision. In the spirit of partnership, I invite you to contact my office with any opportunities to collectively and creatively rise to the challenges that our states face – whether it is in education affordability or one of the many other policy areas that we share as an association.
Hon. Joseph M. Torsella
Pennsylvania State Treasurer