The Problems with the Foster Care System in 2025: Where We Are and What Still Needs to Change
As Foster Care Awareness Month comes to an end this week, we reflect on the systemic and persistent problems with the foster care system in the U.S. Despite years of advocacy and advancement in reform efforts, children and youth in care continue to face serious challenges. This year alone, federal funding cuts, housing insecurity, gaps in education, and the growing shortage of foster parents have continued to put vulnerable children at risk.
In 2025, some of these issues have been made more difficult by shifts in federal policy and strained state resources, making it clear that awareness must translate into urgent action.
Housing Instability Is Pushing Youth into Crisis
Housing insecurity remains one of the most urgent and persistent problems. Youth who age out of foster care at 18 or 21 (depending on their state) often do so without a stable place to live. In 2025, skyrocketing rent prices and a national housing shortage have only made this worse.
Transitional housing programs have long waitlists or limited capacity. As a result, thousands of former foster youth face homelessness, couch surfing, or being forced into unsafe living conditions within a year of exiting care.
A Shrinking Pool of Foster Parents
The number of foster parents has hit a critical low. Many parents have decided to quit fostering, citing emotional exhaustion, rising living costs, and lack of support. At the same time, child welfare agencies in several states are overwhelmed, with more children entering care than homes available. This leads to higher rates of sibling separation, children being placed far from their communities, or in some cases, spending nights in child welfare offices or hotels.
The Education Gap Widens
Another long standing issue is the achievement gap for foster youth in school. In 2025, the numbers remain stark: foster youth are twice as likely to repeat a grade and far less likely to graduate from high school or pursue higher education. Frequent school changes, trauma-related challenges, and lack of consistent academic support make it nearly impossible for many to keep up.
This year, the dismantling of the U.S. Department of Education has only worsened the crisis by eliminating federal oversight and cutting essential funding streams that once supported educational stability for vulnerable students. Programs designed to help foster youth succeed have been defunded or left to the discretion of overburdened state systems, leaving educators and social workers stretched dangerously thin.
Cuts to Federal Support Create New Gaps in Support
Recent shifts in federal funding have created new challenges. The 2025 federal budget proposed major cuts to the Social Services Block Grant (SSBG), a vital source of funding for foster care services across the country. Additionally, the elimination of national funding for CASA/GAL programs means fewer children will have dedicated court advocates. Without these resources, states are being forced to reduce family support services, legal advocacy, and mental health programs.
Mental Health Services Are Not Meeting the Need
Despite growing national awareness of mental health, foster youth still struggle to access timely and trauma-informed care. Waitlists for therapy are long, especially in rural areas. Many providers lack training in childhood trauma, making the care that is available inconsistent or ineffective. These gaps contribute to worsening outcomes for youth already dealing with significant loss and instability.
We Won’t Stop Trying to Improve the System
Despite the deep-rooted and emerging problems with the foster care system, real progress is underway. From policy reform to community engagement, a growing coalition of lawmakers, nonprofits, and everyday advocates is making a tangible impact.
Expanded Ohio Foster Home Pilot Program Reduces Placement Disruptions
One of the most promising advancements this year comes out of Ohio. The state’s foster home pilot program has now expanded statewide. This initiative increases trauma-informed training, boosts foster parent stipends, and streamlines licensing procedures. The program also prioritizes keeping siblings together, and early results show fewer placement disruptions and greater satisfaction among caregivers. It’s a potential model for other states seeking more stable, nurturing homes.
California Launches Guaranteed Income Pilot Program for Youth Aging Out of Care
In California, a guaranteed income pilot program launched in early 2025 is providing former foster youth with monthly stipends as they transition to adulthood. Designed to combat homelessness and job insecurity after aging out, the program offers financial stability while connecting youth to mentors, career training, and housing support. Advocates hope the success of this pilot will push other states to adopt similar post-care safety nets.
Federal Bipartisan Support Grows for Kinship and Sibling Placement Bills
At the federal level, bipartisan coalitions are building momentum behind legislation to strengthen kinship care and sibling reunification. A bill introduced this spring would expand federal funding for kinship placements and provide dedicated caseworker training on keeping siblings together. While broader federal cuts have hit child welfare, especially following the dismantling of the Department of Education, targeted bills like these are gaining rare bipartisan traction.
Nonprofits Like Foster Love Continue Filling Critical Gaps
While government systems are slow to reform, nonprofits are moving fast. Foster Love continues to address gaps in dignity, belonging, and essentials through hands-on programs. From organizing Disney Days to reunite separated siblings, to funding shopping sprees that let teens pick out new clothes, to providing personalized duffle bags through the Sweet Case program, Foster Love is making sure foster youth feel seen, supported, and cared for — every day, not just during Foster Care Awareness Month.
Volunteers and Donors Fuel The Movement
One of the biggest shifts in 2025 isn’t just policy — it’s people. Thousands of new donors, volunteers, and community leaders are stepping up to take action, not just spread awareness. Social media advocacy, virtual service projects, and grassroots fundraisers are building a wider support network for foster youth nationwide, proving that everyday citizens can help drive structural change.
Foster Care Awareness Month Reminds Us: This Is a Movement
Foster Care Awareness Month is more than a month for foster youth, it’s a powerful reminder of what’s at stake. While problems with the foster care system remain, from funding gaps to education disparities, there’s hope in the real progress unfolding across states and communities.
With continued focus, reform, and collective care, we move closer to a system where every child has the support and stability they deserve.
