COLUMBUS, Ind. — Offering money and prizes may be among the only motivations to get Americans to save more.
Centra Credit Union is hoping to do just that with the launch of its prize-based Super Savings program. The $600 million CU, along with researchers from Harvard Business School and the Filene Research Institute’s i3 group, created the savings account that allows members to earn prizes for the money they save. The prizes range in amount and value with 10 prizes awarded each month. A top prize of $1,000 will be given away each month. A quarterly drawing awards a prize that doubles the winner’s savings balance up to $1,000 in prize money, and there will be an annual grand prize valued at $5,000. For every $25 in average balance in the Super Savings account, members get another chance to win a prize.
Centra is the first financial institution in the country to put the program in place having previously piloted it at two of its branches, according to the CU.
“The pilot program was successful, so we’re excited about providing this new savings opportunity to all of our members,” said Nan Morrow, Centra vice president, corporate development.
According to Dr. Peter Tufano at Harvard, Great Britain and several South American countries have been very successful offering prize-based savings accounts to help increase national savings rates. In 2005, the U.S. household savings rate was 0%, and nearly 25% of U.S. households had no savings at all, the CU said.