Key Points
- In the first year of eligibility, 150 young adults directed $349,550 from their accounts to 70 trade schools, colleges, and universities
- Roughly 64% of those expected to enroll in college used the funds in their first eligible semester.
- The experiment's design directly informed the new federal Trump Accounts, which deposit $1,000 for eligible newborns nationwide.
In 2007, Oklahoma automatically opened a state 529 account seeded with $1,000 for more than 1,300 newborns — no paperwork, no opt-in, no action required from parents. Those babies turned 18 in 2025, and researchers just released the first data on what happened when the money finally became available.
The experiment: SEED for Oklahoma Kids (SEED OK), run by the Center for Social Development at Washington University in St. Louis, randomly selected more than 2,700 Oklahoma newborns in 2007. About half received a Child Development Account, a state-owned Oklahoma 529 plan account opened automatically with $1,000. The control group received nothing.
By the end of 2024, the state-owned accounts had grown to an average of about $2,600 and about $5,000 per child when parent-owned 529 savings were included.
Would you like to save this?
We'll email this article to you, so you can come back to it later!
By The Numbers
- The average distribution was $2,330, typically the full account balance.
- 43% of distributions went to trade schools and 2-year colleges, while 57% went to 4-year colleges and universities.
- 81% of receiving schools were in Oklahoma, led by the University of Oklahoma, Tulsa Community College, and the University of Central Oklahoma.
- Over two-thirds of distributions were sent for the fall semester right after high school graduation.
- Women were 19% more likely than men to use their funds — a gap researchers can't yet explain.
Why It Matters
College enrollment in the U.S. typically tracks family income and parental education. In SEED OK, usage was flat across demographic lines. The researchers credit the design: because every account was opened automatically at birth, no family had to fill out forms, know the right questions to ask, or understand how 529 plans work.
That's a sharp contrast with voluntary college savings, where participation skews heavily toward higher-income households. Our 529 plan and college savings statistics show only a minority of American families use 529 plans at all.
How It Connects
SEED OK is the closest real-world test of what universal at-birth accounts can do, and the idea has spread well beyond Oklahoma:
- The model shaped the federal 530A accounts (also known as Trump Accounts) which give eligible newborns the same $1,000 start. Parents weighing those against traditional college savings can compare the two in our breakdown of Trump Accounts vs. 529 plans.
- A growing list of states now offer their own "baby bonus" seed deposits tied to 529 plans. California's CalKIDS program automatically opens accounts for newborns. California Treasurer Fiona Ma discussed building college savings from birth with us. Pennsylvania's Keystone Scholars deposits $100 for every baby born in the state, Maine's Alfond Grant provides $500 automatically, and states including Massachusetts, Connecticut, and Nebraska run their own newborn seed or match programs.
- CSD researchers count more than 30 million people with assets in Child Development Accounts across the U.S. and abroad.
Check your own state's incentives in our state-by-state 529 plan directory.
One more SEED OK result worth noting: nearly half the money went to trade schools and 2-year programs, a reminder that 529 funds work for trade school and credentials and job training, not just bachelor's degrees.
Don't Miss These Other Stories:
Robert Farrington is the founder of The College Investor and is widely recognized as one of the nation’s leading voices on student loan debt and saving for college. He holds an MBA from UC San Diego Rady School of Management and has spent over 15 years researching, writing, and advising on student loans, 529 plans, financial aid programs, and saving and investing for young professionals.
Robert has been featured in the The New York Times, The Wall Street Journal, The Washington Post, NBC News, and Forbes, where he has been a regular personal finance contributor for over a decade. His work combines both professional expertise and personal experience – he successfully navigated his own student loan repayment journey and has helped thousands of readers do the same.
He is committed to making the intersection of personal finance and education transparent and accessible. You can learn more about Robert on the About Page or on his personal site RobertFarrington.com.