Educating and motivating members to make smart choices is good business for credit unions.
New Year’s Resolutions often include some promise to start saving money. Easier said than done. The average American age 40 or under says there’s nearly a 50% chance they would not be able come up with $2,000 next month if there were an emergency, according to CNN Money. This in turn causes family stress that replacing the A/C, or a trip to the emergency room would finically devastate the household. This is why many companies and banks are providing services to help individuals create and stick with a savings plan.
Prized-linked savings incentive program
Walmart, in cooperation with Green Dot, announced the launch of “Prize Savings,” a prize-linked savings incentive program available to the millions of Walmart MoneyCard holders. Maryland has established a program called Maryland Cash. They partner with a variety of both public and private organizations to help working families establish financial security. Save To Win, and SaveUp, are two examples of programs offered by banks and credit unions to provide meaningful incentives for customers and members to increase their savings, through what is referred to as “prize-linked savings”. The American Savings Promotion Act allows banks and thrifts to establish prize-linked accounts in any state that approves these programs. The winnings and rules vary, but most programs raffle off cash and prizes to individuals who contribute to a savings account. The programs are designed to help participants develop a regular saving habit. This gives people a safety net. So when the inevitable bumps in the road do come along, it’s not a catastrophe. And these programs seem to work.continue reading »