The news came with the kind of language that makes press releases feel happy. “Starting early makes a difference,” said BlackRock Foundation President Claire Chamberlain. She’s right, too. But there is something important to think about here: the world’s largest asset manager, a company that is in charge of about $10 trillion in assets, just sent $586,00 to 586 children of Pittsburgh firefighters to start college savings accounts. It’s a really helpful thing. It’s also a very planned one.
The mechanics are pretty easy to understand. Through a partnership with The Pittsburgh Foundation and the Pennsylvania Treasury Department, BlackRock put $1,000 into PA 529 college and career savings accounts for children of firefighters from IAFF Local No. 1 in Pittsburgh. The PA 529 program is Pennsylvania’s tax-advantaged way to save for college. It can be used to pay for tuition, fees, books, room and board, and even apprenticeships or technical training. Kids born in 2019 or later can also get a separate $100 scholarship through the Keystone Scholars program in the state. For kids who are eligible, the early boost adds up to more than $1,100 before the family has saved a dime.
The head of Pittsburgh Fire Fighters Local No. 1, Ralph Sicuro, said it was one of the most meaningful ways to honor the work his members do every day. That feeling seems real, and it probably is. In any way you look at it, firefighters are not paid enough for the physical and mental work they do. A $1,000 head start on a child’s education is real money for a family that is saving for college while also making rent, car payments, and dealing with the financial stress of working in a job where injuries are always a possibility.
It’s still important to note what BlackRock gets from this move. Larry Fink, the chairman and CEO of the company, has written in his annual letters that early wealth-building accounts—the ones that give people money before they’re adults—are linked to higher rates of getting a degree, starting a business, and buying a home. That isn’t just about social science. That’s a list of people who might become investors, clients, or people who trade on the capital markets that BlackRock manages. The company also said last year that it would match the $1,000 that the government put into so-called “Trump Accounts” for eligible U.S. workers. The main idea is always the same: get people into savings accounts early and keep them there.
The Pittsburgh gift is not at all cynical because of these things. The $1,000 will stay in those accounts even if no one in the family ever buys a BlackRock fund. When they turn 18, the kids whose parents ran into burning buildings while working overnight shifts will get a surprise. That part is real and good. But when you see a company this big invest in saving and learning about money with the help of state treasuries, local foundations, and labor unions, it’s hard not to see it as more than just charity. It seems like BlackRock knows, maybe better than most, that getting more people to believe that investing can help them is important for the future of asset management.
More than 335 thousand accounts have been opened in the PA 529 program so far, and over $9 billion has been saved across the state. With its donation, BlackRock raises that number and gives its name to firefighters in a major American city, a job that is respected by most people. Things look clean. The plan is a good one. The bank account is at least a little cleaner for 586 kids in Pittsburgh than it was before.
