Many families are faced with critical choices when it comes to managing household income. General expenses and entertaining or ‘fun’ purchases often overshadow important financial priorities. Thus, the long term benefits of saving are cast aside in favor of immediate rewards. Preliminary data indicates that incentives are powerful and can encourage everyday consumers to develop good saving habits for the future. In an effort to make saving fun, organizations have started to look at prize-linked savings (PLS) game structures that can generate excitement about an otherwise mundane activity and create win-win situations where consumers save, have chances to win prizes, and earn interest on deposits.

In 2009, the Doorways to Dreams Fund (D2D Fund), with support from CFSI’s Nonprofit Opportunities Fund, launched an innovative savings product called STW. The Michigan Credit Union League (MCUL) and eight Michigan credit unions implemented the PLS concept by offering specific accounts, which linked deposit activity to monetary prizes.

The Michigan Credit Union League and the Filene Research Institute worked with the D2D Fund to develop STW and was the first to pioneer the implementation of a large-scale PLS product in the U.S. In just three years, Save to Win in Michigan has engaged a diverse set of consumers, including those with low and moderate incomes. By December 2011, low- to moderate-income accountholders had saved an average of $1,435 in their STW accounts while asset-poor accountholders had grown their average end balance to $762. A total of 10 credit unions offer the STW product in Nebraska and product take-up is showing promising gains. In its first seven months, 1,300 STW accounts have been opened. These STW accountholders have saved over $1.1M, representing an average savings of $857.