By Catherine K. Ettman | November 19, 2024
Baby Bonds are an increasingly popular bipartisan government policy in which every child born into poverty receives a publicly funded trust account at birth, providing them with “start-up capital” to pursue fulfilling, productive, prosperous, and self-directed lives. Follow our Baby Blogs series to learn about the vision, politics, and people behind Baby Bonds and their transformative impact on the lives of young people, their families, communities, and our economy.
In this installment of Baby Blogs, Catherine K. Ettman, assistant professor in the Department of Health Policy and Management at Johns Hopkins Bloomberg School of Public Health, discusses how asset-building policies like Baby Bonds can improve not only financial security but mental health and well-being.
Growing up in Greater Miami, Florida, I saw wealth inequality firsthand. Tall grass grew in the front yards of the homes in my neighborhood that were foreclosed. Appliances were taken and families moved out during the subprime mortgage crisis.
Seeing high levels of wealth in close proximity to poverty motivated me to find my first internship working for my hometown congress member, Representative Ileana Ros-Lehtinen. From there I studied public policy at Princeton University, where I learned about the origins of inequality and the policies that drove people to grow—or lose— their life’s savings. From college I went back to Washington, D.C. to work in national politics, and then moved to the states to see policy change on the ground level.
I bought a one-way ticket to Texas where I worked on a campaign for governor. In knocking on doors and talking to constituents, I listened and learned about what mattered to voters, ranging from the economy to financial stability to health and health policy. Wanting to have better answers for their questions, and understand policy even better, I pivoted from politics to public health.
There, I saw the power of scholarship to inform policy, and I found my passion for population mental health, assets, and policies across sectors that can improve health for all.
One of the chief benefits of asset-building initiatives like Baby Bonds is the potential of narrowing the wealth gap in the United States by helping families accumulate savings. But an often overlooked benefit of wealth-building policy may be improved mental health.
Depression and anxiety are common—over 21 million U.S. adults have experienced a major depressive episode in the last year and 31 percent of adults have had anxiety at some time in their lives. Poor mental health influences not only the individuals who experience depression or anxiety, but also their families, friends, and communities. Mental health is influenced by the world around us and is sensitive to economic factors—and policy interventions can help to address those assets, which can in turn improve mental health.
Our team has outlined three assets that shape access to health promoting resources, which, in turn, shape health: financial assets, physical assets, and social assets. Financial assets include income, which is the most commonly studied socioeconomic variable related to mental health, but also savings, credit, and debt. Physical assets include cars, homes, and technological devices that facilitate economic opportunities and access to health promoting resources. And social assets include educational attainment, marital status, and religious affiliation, among others. Social assets can provide psychological relief and also provide material resources through group membership, privilege, and power.
Despite wealth being foundational to differences in lived experience, it is far less studied than income or other financial assets. In 2007, Dr. Craig Pollack and colleagues published a paper entitled, “Should Health Studies Measure Wealth?: A Systematic Review.” The paper concluded that yes, health studies should measure wealth. While it was a much less studied variable than income, wealth was consistently associated with health and mental health indicators. We followed up 15 years later with a scoping review on studies assessing wealth and depression, in particular. In that study, we identified 96 articles published from the start of PubMed indexing of peer reviewed articles until July 19, 2020 that assessed the relation between wealth and depression. Among those studies, more than half found a significant association between wealth and less depression.
One reason that wealth is less featured than income in studies is that it is harder to measure; to address this, our team established the CLIMB Study. The CLIMB Study is a nationally representative longitudinal cohort study that measures detailed assets and trends in mental health, among other questions. We started collecting data in 2020 and are grateful to have support to survey participants annually through 2027 with thanks to the de Beaumont Foundation.
In a new paper using CLIMB data, “Financial Assets and Mental Health Over Time,” we found that having family savings was associated with lower prevalence of positive screenings for depression, anxiety, or both, from 2021 through 2023—above and beyond income, financial stress, and other demographic variables. In another paper published this year using CLIMB data, we found that groups with low savings had higher depressive symptoms than groups with high savings in 2021 and 2022. These studies add evidence to a growing chorus that wealth is associated with mental health or, conversely, that lower wealth is associated with worse mental health.
Policies that improve access to assets, including Baby Bonds, can be an effective intervention to help families grow assets, accumulate wealth, and have improved mental health. In a policy experiment in Oklahoma that provided funds for Child Development Accounts (CDAs) to low income families, mothers who received funds for their newborn children’s 529 savings accounts had lower depressive symptoms than mothers in families who did not receive funds. There is growing evidence that providing assets to young children provides not only a path to wealth building for those children, but can also improve the mental health of their families.
Investing in children is a down payment on the future. By providing avenues to build assets such as through Baby Bonds we invest not only in our wealth but also our mental health—and a more equitable world.
Catherine K. Ettman, PhD, is an assistant professor in the Department of Health Policy and Management at Johns Hopkins Bloomberg School of Public Health. She studies population mental health, assets, and policies within and outside of the medical system that can improve health and reduce disparities.
If you missed previous installments of our Baby Blogs series, read them here.
Learn more about Health and Wealth.
To share feedback on this blog, or for questions about Baby Bonds, email David Radcliffe at [email protected].
To learn more, explore our Baby Bonds resources.