International Child Development Accounts

Abstract

Child Development Accounts (CDAs) are subsidized savings or investment accounts to help people accumulate assets for developmental purposes and life course needs. They are envisioned as universal (everyone participates), progressive (greater subsidies for the poor), and potentially lifelong national policy. These features distinguish CDAs from most existing asset-building policies and programs around the world, which are typically regressive, giving greater benefits to the well-off. With policy innovation in recent years, several countries now have national CDA policies, and four states in the United States have statewide programs. Some of these are designed to be universal and progressive. Evidence indicates that true universality can be achieved, but only with automatic account opening and automatic deposits. In the absence of automatic features, advantaged families participate and benefit more. Today, momentum for universal and automatic features is gradually gaining traction and accelerating. At this stage in the emergence of inclusive asset-based policy, this is the most important development.

Cash Transfers and Health

“…It covers all children under age 18. CDAs have also been implemented in the United Kingdom, Canada, South Korea, Taiwan, Uganda, and elsewhere (58,104).…”

Exploring a Model for Integrating Child Development Accounts with Social Services for Vulnerable Families

“…CDAs have been implemented in Singapore, Korea, the United Kingdom, Canada, Israel, and elsewhere (Clancy and Beverly ; Loke and Sherraden ; Sherraden et al ). But they were initially piloted in the United States two decades ago as small‐scale community‐based programs.…”

Household Savings Decisions in Israel’s Child Savings Program: The Role of Demographic, Financial, and Intrinsic Factors

“…Specialized savings programs such as Child Development Accounts (CDAs) can potentially be effective in helping families overcome institutional barriers to savings and boost long-term asset accumulation. CDA programs, defined as savings or investment accounts opened at birth or young age, can provide children and their families with an access to tax-advantaged savings vehicles that can deliver direct financial benefits to program participants starting in early ages (e.g., through recurring savings deposits, matched savings, or initial seed deposits) and may offer larger benefits to lower-income households (Sherraden et al, 2018). Several countries, including the United Kingdom, Canada, Singapore, South Korea, and Israel, and some states and cities in the United States have previously implemented CDA programs with varying program designs.…”

“…Israel's CDA program, called the Savings for Every Child Program (SECP), was rolled out in January of 2017. The SECP is the first universal CDA program worldwide that automatically deposits funds into savings or investment accounts for every child in a country (Sherraden et al, 2018). Under the program, every child under the age of 18 gets NIS 50 (Israeli New Shekels, approximately USD 14, based on January 2020 exchange rates) deposited by the government into their CDA accounts each month.…”