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Communities in Focus:
Puerto Rico

As policymakers at the national level grapple with the cycle of intergenerational poverty, Puerto Rico is implementing innovative asset-building strategies designed to help low-income individuals build wealth. In this section, we highlight the SEED (Savings for Education, Entrepreneurship, and Downpayment) program, an initiative that promotes child savings accounts (CSAs).

Although CSAs are relatively new, the United Kingdom has implemented its own version of CSAs known as Baby Bonds. The Puerto Rico partnership includes financial institutions, community-based organizations and a local public school.


  • In 2005, nearly 60 percent of Puerto Rico’s children lived below the poverty threshold.
  • Puerto Rico’s per capita personal income in 2005 was $12,502. Per capita income for the rest of the nation was $34,586.
  • About 45 percent of Puerto Rico’s residents live below the poverty threshold. More than 10 municipalities have poverty rates greater than 60 percent (see map). The major metropolitan area, San Juan, has a poverty rate of more than 30 percent.

The SEED Program: An Asset-building Initiative

  • Saving for Education, Entrepreneurship, and Downpayment (SEED) is a program targeted at increasing child savings rates in Puerto Rico. SEED is a collaborative initiative between the community-based organization Chana Goldstein y Samuel Levis, the Center for the New Economy of Puerto Rico and Doral Bank.
  • The program is a demonstration project. Each child enrolled in the program receives an initial deposit of $250 and is eligible to receive a total match of $1,200 over a four-year savings period.
  • The accounts are intended to help children save for future endeavors such as educational attainment. Children in the program typically save between $10 and $25 per month from money they receive in allowance or earn by doing chores. As of June 30, 2006, children participating in SEED had saved an average of $14 per month.1
  • The program also emphasizes financial education for both children and parents. As part of the program, children and parents each attend six financial counseling sessions.

Percentage of Puerto Rico Population in Poverty by Municipio, 2000

Source: Census 2000, U.S. Census Bureau, U.S. Department of Commerce, Economics and Statistics Administration.

Contact: Javier Silva at (212) 720-2789 or javier.silva@ny.frb.org

1 Figure provided by Iris A. Medina-Torres, SEED Initiative Coordinator, Chana y Samuel Levis Foundation, San Juan.


December 2006