Booker, Pressley Reintroduce Bicameral ‘Baby Bonds’ Legislation to Tackle Wealth Inequality 

U.S. Sen. Cory Booker (D-NJ) and U.S. Rep. Ayanna Pressley (D-MA) this week reintroduced the American Opportunity Accounts Act, legislation that would create a federally funded savings account for every child in order to make economic opportunity a birthright for everyone in America and help close the racial wealth gap. The lawmakers’ bill comes as baby bonds programs gain traction nationwide. 

The American Opportunity Accounts Act, also known as “baby bonds,” would give every child a chance at economic mobility by creating a seed savings account of $1,000 at birth. The funds would sit in an interest-bearing account that would receive additional deposits each year depending on family income. At age 18, account holders could access the funds in the account for allowable uses like buying a home or paying for educational expenses. The legislation is paid for by making changes to federal estate and inheritance taxes. 

At birth, every American child would be given an “American Opportunity Account” seeded with $1,000. Each year, children would receive up to an additional $2,000 deposit into their American Opportunity Account, depending on family income. These funds would sit in a federally insured account managed by the Treasury Department, achieving roughly 3% interest. Account holders may not access the money until they reach age 18 and will only be able to use the funds for allowable uses like homeownership and higher education — the kind of human and financial capital investments that changes life trajectories. 

The bill is cosponsored by: Sens. Dick Durbin (D-IL), Ed Markey (D-MA), Jeff Merkley (D-OR), Elizabeth Warren (D-MA), Bernie Sanders (I-VT), Sherrod Brown (D-OH), Richard Blumenthal (D-CT), Chris Van Hollen (D-MD), Brian Schatz (D-HI), Sheldon Whitehouse (D-RI), Chuck Schumer (D-NY), Tammy Baldwin (D-WI), Amy Klobuchar (D-MN), and Kirsten Gillibrand (D-NY). 

The list of endorsing organizations can be found here.