First ever ‘Baby Bonds’ in New Mexico awarded to 15 children
NEW MEXICO (KRQE) – 15 children received New Mexico’s first ‘Baby Bonds,’ a.k.a. nest eggs that will grow over time, and allow those children to use that money for things like education and home ownership when they turn 18.
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“We were low income, my family was low income so I wanted to go to college and I wasn’t able to,” said Leslie Moreno-Roacho, whose one-year-old son Zaiden is the first child in New Mexico to receive one of the ‘Baby Bonds.’ “The bond is more than just money; it’s a ticket to opportunities. The opportunities I never had. It means he can dream big to go to college and hopefully avoid the stress of student debt,” Moreno-Roacho said.
He’s one of 15 children awarded this Baby Bond through a pilot program created by a coalition of advocacy groups, including Partnership for Community Action (PCA), Abriendo Puertas/Opening Doors, Prosperity Works, and MoneyByrd. “Baby Bonds really present us with a path forward on the idea that one of the best ways to make money is to have money,” said Nichelle Gilbert, executive director of Partnership for Community Action.
“This is what every parent wants for their child: the best life possible. And Baby Bonds are a solid solution to help every family in New Mexico achieve this,” said Dr. Ann Lyn Hall, executive director at Prosperity Works.
“So New Mexico, like many other states, right, is working actively to dismantle generational poverty and we are making strides in the area of equitable access to capital,” Gilbert said.
Each child got a $6,000 deposit into an account managed and invested by MoneyByrd, which will grow over time until the child is 18 and eligible to withdraw it—after taking a financial capabilities course. The goal is to help them pay for things like education, home ownership, or starting a business. “Participants are all connected to the work of PCA through their completion of Abriendo Puertas, a powerful and true family engagement curriculum, and they all have children ages 0 to 5,” Gilbert said, “The Baby Bonds recipients represent five counties throughout New Mexico, two of those counties have a rural designation. All representation is from communities of color in our state.”
“So today y’all, New Mexico joins a growing number of places around the nation, like Connecticut, California, and D.C. in implementing and advocating for a baby bond concept that centers wealth equity and economic mobility designed to narrow the racial wealth divide,” Gilbert said.
According to data from the Economic Policy Institute, New Mexico ranks 45 out of 50 for income inequality in the United States. “We know the massive racial wealth gap: it is grounded in a history that unfortunately has not provided access to capital for all people,” said Dr. Darrick Hamilton, professor at The New School, “So Baby Bonds is meant to address that. Baby Bonds is meant to promote human flourishing. Baby Bonds is an important asset because it cedes wealth. It cedes something as functional as wealth because how is wealth generated? It is wealth that begets more wealth.”
This is just the beginning of this pilot, which has raised $90,000 through private donations to fund the first 15 accounts. “We’re challenging ourselves to bring that capital stack up to six million dollars,” Gilbert said, to be able to fund accounts for upwards of 400 families and bring the initial investment for each recipient up to $13,000.
This pilot has caught the attention of state officials, who now want to ask the state legislature to do something similar: “”It’s not enough for us just to survive. It’s not enough for us just to get by. What about thriving? What about building assets? What about building wealth for our families, right? This economy across this state and across the country is built on the backs of working families. It is time that we get to build that wealth as well,” said Javier Martinez, (D-Albuquerque) Speaker of the House.
“We’re going to be asking the State of New Mexico to put aside money which will accumulate interest over time that will be used for these Baby Bond recipients,” said Laura Montoya, New Mexico State Treasurer.
“You all are taking leadership, and the nation’s watching to ensure that we start all young adults off with a nest egg, some capital so they can have a lifetime of economic security and financial agency,” Hamilton said.
Recipients will be eligible to withdraw up to two-thirds of the fund when they turn 18; the remaining third will be reserved for retirement when they reach age 65.
If the amount is left in the fund until retirement, it’s estimated the $6,000 investment would grow to nearly $500,000.
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