How does the Upromise college savings website work and is it trustworthy?
This question was answered on October 27, 2004. Much of the information contained herein may have changed since posting.
Upromise.com is a web-based program that was created to help families save money for college It is a complex series of relationships that allow you to get a small rebate from various retailers and manufacturers that will be placed in a college fund for your child.
When you initially create an account by (securely) entering information about the various credit cards, debit cards and grocery store discount cards that you use, they begin tracking your qualifying purchases.
There are nearly 30,000 grocery stores, drug stores, gas stations, restaurants, brick and mortar retailers and online retailers that are participants in the program that will give you a small rebate with every purchase (as long as you used one of the cards that were submitted for tracking purposes).
The money that is accrued goes into a non-interest bearing account until you decide to roll it into a 529 fund (a state run savings program for education).
529 funds are similar to a 401(k) plan, with the goal being to save for college instead of retirement and offer many tax advantages and flexibility.
(You can learn more about them at your favorite financial site or at the Upromise.com website.)
So when you make a purchase of a box of tissues from Kimberly-Clark at a participating grocery store, the transaction information is sent to Upromise, who then submits it to Kimberly-Clark on your behalf Once the rebate is sent from Kimberly-Clark to Upromise, it is deposited in your account.
You can also invite family and friends to join and contribute to your child’
s account whenever they spend money with any Upromise partners.
So the next question is just how does Upromise make its money? The majority of it comes from its partners and affiliates that feel that the system encourages customer loyalty and repeat business, as well as a potential to draw friends and family in through ‘viral marketing’.
As far as your personal information and credit card numbers being safe in the Upromise system, it’s as safe as any commerce site on the Internet, but by default, your contact information will be placed on their marketing list unless you opt-out.
If you don’t click on the ‘opt-out’ link on the second screen during the sign-up process, you will be agreeing to many things, such as email updates on your account., monthly and quarterly newsletters, ‘savings opportunities’
, occasional email surveys, potential contact by phone about ‘savings opportunities’ and ‘contributing companies’ (their affiliates) contacting you about ‘new savings opportunities’.
In essence, if you don’t pay attention, then you will be authorizing the delivery of many ‘offers’ by both e-mail and at the phone number that you used during your sign-up.
It’s simple to avoid these items and I don’t see any reason why anyone that has children of any age wouldn’t want to sign up.
It isn’t going to foot the entire bill for college, but it could certainly pay for a lot of expensive books (my family averages a couple hundred dollars per year)!
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Posted by Ken Colburn of Data Doctors on October 27, 2004