Created by student loan lender and servicer Sallie Mae, Upromise is one of the largest rewards programs in the country and offers savers a chance to provide boosts to their 529 plans and other college savings vehicles.
Recently, there have been some changes and tweaks to the program. However, the core idea of getting rewarded for spending remains. And given that it’s free money for college, Upromise is worth pursuing.
But, what exactly is Upromise and how can it help you save for college? Read on to find out.
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After filling out a quick form, signing up for an account and linking your credit/debit cards, members have the opportunity to earn rewards in one of three ways.
First is through online shopping. Upromise acts as a portal to gain cashback rebates from merchants. Here, savers click through the Upromise website and are then taken to the merchant’s e-commerce page. From here, members can earn around 3 to 7% of their total purchases from the website.
Second, savers can earn rewards from dining at participating restaurants. By linking a debit or credit card to a Upromise account, savers can score 2.5% cashback on their purchases while eating out.
Finally, users looking to get cashback from everyday spending can sign up for the Upromise Mastercard. With the credit card, savers can score 1.25% cashback on all purchases made. Additionally, there are opportunities to earn bonus points through the Upromise Round Up program, which rounds up cents from purchases to the nearest dollar, as well as bonuses for direct deposits into Upromise-sponsored 529 plans. An added bonus is that program members using the Upromise Mastercard can stack rewards by shopping online with the program’s portal and getting double the cash back at participating restaurants.
One of the biggest changes to the program, however, is that Upromise has eliminated the ability to link a debit/credit card to get cash rewards from shopping in-store for certain brands. While it was once a popular feature, the growth of online shopping has made it obsolete in the modern era.
However, Upromise has worked directly with several states and other plan sponsors to allow direct deposits of Upromise rewards into their accounts. So, plan members are not locked into only using the Upromise-sponsored account anymore.
One thing to keep in mind is that these reward deposits are not eligible for state deductions or tax credits.
No matter what plan you decide to use, Upromise offers a variety of new tools and educational articles to help design a savings plan that is right for your future students. Thanks to recent changes, there is more focus on getting the most beneficial plan started and actually saving in addition to receiving rewards.
There are also a few changes to using the rewards front as well. Sallie Mae no longer offers high-yield savings accounts and rewards cannot be transferred there. In addition, rewards may no longer be used to pay down student loans at the lender.
Check out our state plans section here to learn more about the rules and regulations pertaining to each U.S. state.
However, there can be some drawbacks. For one thing, Upromise works best when you use the Mastercard and stack the rewards. For those with poor credit histories, this might not be an option. Also, if you carry a balance, the interest may counteract any benefits or rewards from the card.
Secondly, if you’re not an online shopper then the program loses some of its benefits. Again, if your buying things you don’t need to get the rewards then Upromise isn’t a great deal.
However, for buying things you were already going to for using the various rewards, the program can be a great supplement to a savings plan. The thing to remember is that these rewards won’t be enough to actually pay for college. That will still take plenty of savings.
Be sure to check out our 529 Insights section here to learn more about 529 plans.