CT state Treasurer Wooden calls for passage of Baby Bonds bill

State Treasurer Shawn T. Wooden has called on legislators to pass House Bill 6659, An Act Concerning the Establishment of the Connecticut Baby Bonds, which he said would bridge wealth disparities within the state.

The Baby Bonds program is designed to provide all Connecticut residents born on or after Jan.1, 2022, and whose birth was covered by HUSKY Health with a savings account starting at $5,000 at birth. The account would be managed and invested by the treasurer”™s office until the participant is 18, at which point the individual can use the accumulated funds for either educational purposes, a home purchase, an investment in a business or allocation to a retirement savings program.

Wooden added that if one assumed a 6.9% rate of return, which the state uses for investment of pension funds, the beneficiary could have at least $16,618 when the funds are claimed. Beneficiaries will have up until their 30th birthday to apply to claim the funds.

The Baby Bonds program was inspired by the proposed federal American Opportunity Accounts Act, a bill introduced by U.S. Sen. Cory Booker (D-NJ) and Rep. Ayanna Pressley (D-MA) in 2020 and reintroduced in February.

“One of the most effective ways to narrow the racial wealth gap and break the cycle of poverty is for the state to establish saving accounts that directly invest in children born into poverty,” said Wooden. “By taking bold action now, we can change the life trajectories of thousands of Connecticut residents while also enhancing the economic trajectory of our state.”