The Imprint is highlighting each of the policy recommendations made this summer by the participants of the Foster Youth Internship Program (FYI), a group of 12 former foster youths who have completed congressional internships.
The program is overseen each summer by the Congressional Coalition on Adoption Institute. Each of the FYI participants crafted a policy recommendation during their time in Washington, D.C.
Today we highlight the recommendation of Sheree Hickman, 24, a graduate social policy student at Washington University in St. Louis.
Hickman’s proposals align around the idea of helping older foster youth think about, establish and manage savings. First, she would require that states set aside 10 percent of their Chafee Independence Program funding “for programs that help youth transitioning out of care become financially stable and independent.” The Chafee program supports independent living programs.
She would also increase funds to a second Chafee program – the Educational Training Voucher, which provides college tuition grants to current and former foster youths – and allow students to put up to $1,000 of their grant into an individual development account (IDA).
Finally, Hickman would establish a tax incentive for organizations, corporations and individuals to set up IDAs for foster youths.
Hickman cites research that two-fifths of foster youth have outstanding debt at age 21, and that only half reported having a bank account. “The lack of financial well-being adds to already existing stress and uncertainty young people face in transitioning from care,” she argues.
In Their Own Words
“Although California provided financial training to foster youth through their independent living program, the instruction was inadequate and failed to prepare me for real-world situations. With rising child welfare caseloads across the United States and the costs of education continuing to increase, there has never been a better time to ensure young people in foster care have the skills and resources they need to be financially independent.”
The Imprint’s Take
As Hickman’s FYI colleague Christopher Scott points out in his proposal, a lot of states are
returning some of their ETV dollars, unspent. So this is a ripe area to study, and perhaps build upon.
ETV is a magnificent vehicle for what Hickman has in mind, which is empowering youth to build up a little savings before they head out into the post-college world. One thing: it seems unfair that a foster youth who sought a path other than the traditional college route could notget the same help building savings. Perhaps a separate Chafee IDA Account, untethered to ETV, would be more appropriate.
As for the tax incentive, Hickman comes to the idea with a precedent. Oregon has operated an IDA incentive, which matches the money of participants once they reach agreed-upon savings goals.
Not to belabor the idea, but perhaps a Chafee IDA program could exist as a matching grant between the feds and states (as ETV is) with some boost or enhanced allocation for states that added a tax incentive to entice more local dollars.