Introducing Kentucky’s Program: Transforming College Students into Skilled Investors
In an innovative move to encourage college students to save and invest early, the University of Kentucky has launched a groundbreaking program called UK Invests. Through this program, the university offers to seed brokerage accounts for all of its 31,500 students. This initiative aims to provide students with free money to invest, with the condition that they complete certain tasks before receiving the university’s contribution.
While many colleges have investment clubs and some universities offer personal finance classes, what sets UK Invests apart is its university-wide scope and the fact that students do not have to contribute any of their own money. The university has committed to depositing up to $250 per semester into each student’s account, contingent on their completion of specific tasks.
The tasks range from attending talks on investing topics and the magic of compounding (earning $30), to participating in workshops on stress management ($10), and uploading resumes to the career center ($25). By incentivizing activities that can improve students’ health, academic performance, and employability, the university aims to instill lifelong habits that lead to a meaningful and purposeful life, according to Kirsten Turner, Kentucky’s vice president for student success.
Fidelity, the brokerage firm associated with UK Invests, is also contributing incentives. Once a student’s account balance reaches at least $50, Fidelity provides an additional $100. Furthermore, Fidelity matches 10% of the first $300 deposited. Consequently, students who signed up for UK Invests in the fall semester can potentially receive up to $630 in the current academic year.
To begin participating in the program, students must sign up for the Fidelity Bloom for UK Invests app. They are also required to fund their accounts using their own money, the university’s contributions, or both. Once these steps are completed, the Fidelity Bloom app offers three basic low-cost mutual fund options based on the student’s risk tolerance.
Although the Fidelity Bloom app only allows trading in a few mutual funds, UK students can invest in a wider range of mutual funds, exchange-traded funds, stocks, or bonds by logging into their Bloom accounts through Fidelity’s primary website. Any uninvested money will earn interest in a Fidelity money market fund.
While students have the flexibility to withdraw cash whenever they want, the university encourages them to remain invested. Time is seen as their greatest advantage, as stated by Eric Monday, the university’s executive vice president for finance and administration.
Some students have embraced the program’s message and its potential benefits. Sophomore Elizabeth King has already received over $200 since opening her account in the fall of 2023, primarily by attending career fairs. She decided to invest in a low-cost S&P 500 index fund and plans to hold it for the long term. King acknowledges the power of compounding, a concept she learned during an investing presentation, and intends to take advantage of market dips.
The University of Kentucky’s UK Invests program is revolutionizing how college students approach saving and investing. By providing financial incentives tied to educational, personal development, and career-building activities, the program encourages students to develop healthy financial habits and capitalize on their long-term investment potential. With Fidelity’s support, the program amplifies its impact, enabling students to grow their accounts and gain valuable experience in managing their finances. As more universities consider similar initiatives, UK Invests serves as a prime example of how institutions can empower their students to become skilled investors from an early age.
Disclaimer: The views and opinions expressed in this article are those of the author and should not be construed as financial advice. The Epoch Times does not provide investment or personal finance advice and holds no liability for the accuracy or timeliness of the information provided.
