College Savings for Millions of New Yorkers
The exciting implications of a new forward-thinking tax bill
Mae Watson Grote | Founder and CEO | The Financial Clinic
Progress IS possible!
Through November, like many of you, we were feeling wary about how the election will impact the communities we care about. Working poor families will be hit hard if the federal resources that help them make ends meet are weakened or destroyed.
Then, a proverbial ray of sunshine broke through, and a bright bipartisan spot at that: On Monday, November 28, Governor Andrew Cuomo signed the “#Refund529” bill into law (A9118/S6942), allowing New Yorkers to split their annual refund to contribute directly into a 529 college savings account. The Clinic is proud to have brought Refund529 to life, advocating with our partners at Citizens’ Committee for Children of New York (CCCNY) and the New York Asset Development Coalition, a coalition of eight nonprofits serving 50,000 working poor every year. We are also very grateful to the bill’s sponsors, Assemblyman David Buchwald (D-Westchester County) and Senator Thomas Croci (R-Suffolk County), who introduced it to both houses where it was voted through almost unanimously.
Our vision comes vividly to life when we see our influence grow above and beyond the individual customers.
This accomplishment was years in the making. From the Clinic’s very first business plan more than 11 years ago, we were clear in distinguishing mission from vision: While our immediate focus is for the boots-on-the-ground services for working poor individuals and families, we never lose sight of the ultimate goal of achieving a financially secure nation. We are extremely proud of our work building the financial security of thousands of people each year, but having the ability to leverage that experience and expertise into lasting, systemic change to affect millions of lives is a dream come true. Our vision comes vividly to life when we see our influence grow above and beyond the individual customers. After years of collecting and analyzing the data, identifying the pervasive barriers, and fighting to have the voices of the low-income populations heard, our collective investment has paid off.
For working poor New Yorkers, the annual tax refund often represents a significant percentage of their yearly income, up to 40 percent! By creating a vehicle to automatically deposit a portion into a savings account, #Refund529 provides an unprecedented opportunity for this struggling population to save for their children’s college education. We see firsthand with our financial coaching customers that many low- and moderate-income individuals are disconnected from mainstream financial services, stemming from either a mistrust of banks or simply a lack of assets to deposit. They far too often are unaware of resources like a 529. Now, they’ll have a new and easy way to save.
Considering a college degree has the potential to almost double a New Yorker’s earnings, #Refund529 is a clear step to ensuring a secure future for our city’s workforce, even against the backdrop of the political turmoil at the federal level. Our work isn’t done, but we can at least take a moment to celebrate today’s win. Cheers!
Click here to read the press release
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