The push for "baby bonds"

Child welfare advocates are pressuring New Mexico, which has the largest proportion of Latino residents nationwide, to create state-funded saving accounts for children born into poverty.

Why it matters: Roughly 28% of New Mexico children under age 5, and a quarter of those under 18, live in poverty — while the official poverty level nationally is 11.1%.

State of play: About a quarter of U.S. states are debating or showing interest in a program to endow U.S. citizens with a grant worth thousands of dollars when they turn 18, according to the Harvard Kennedy School.

• Proposals for so-called baby bonds have passed in Washington, D.C., Connecticut, and California and been introduced at the federal level and eight additional states.
• The grants, which start accumulating at birth, can be used to start a business, purchase a home, save for retirement, or pursue a college degree.

Zoom in: New Mexico's state treasurer, Laura Montoya, tells Axios a new baby bonds program could be a "game changer" and help erase economic gaps in her state, where about 75% of all children are born into families using Medicaid.

• The baby bonds could be used to create wealth as soon as the child becomes an adult and may be used to introduce residents to financial literacy.

Connecticut, which launched the country's first statewide baby bonds policy in June 2023, begins with a $3,200 deposit. Washington, D.C., starts at $500.

• When children reach a certain age, they must spend their share on job training, college, property — something that could build wealth.

Reality check: It's unclear if Montoya and advocates can get a baby bonds proposal through the New Mexico legislature in next year's session.

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