California expands program offering money for college savings to all students

A new bill signed into law in July will expand the California Kids Investment and Development Savings Account (CalKIDS) program beginning next year.

Initially, CalKIDS would provide a ScholarShare 529 account with $25 of "seed" money for every child born in the state. AB 132 expands the program, adding $500 to the account when a child begins first grade in a California public school. The program also offers an additional $500 for children in foster care and $500 more for any children experiencing homelessness.

Lawmakers set aside $1.9 billion in state and federal funding for the first year. It will establish accounts for approximately 3.7 million California students. After that, the program will cost an estimated $170 million each year for all newborns and new first graders.
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