Credit unions motivate Minnesotans to save, win money
A new study from Commonwealth on the savings habits of Minnesota credit union members found that prize-linked savings accounts incentivize people to save money for the first time and help change overall savings habits.
WINcentive Savings® incentivizes members to save by offering risk-free rewards. WINcentive prizes are awarded on a monthly, quarterly, and annual basis, with prizes ranging from $100 to $5,000. Offered at 23 credit unions across Minnesota, WINcentive Savings has established and grown a new pool of savers. Since the product launched in the state in 2016, over 8,250 WINcentive accounts have opened with over $8 million saved with an average balance of $949.
Commonwealth, a national nonprofit dedicated to building financial security and opportunity for financially vulnerable people, conducted a survey of WINcentive participants and found that offering the chance to win a prize is effective in promoting savings habits and also may attract members to their first savings product.
“Our research found WINcentive Savings accounts are helping many credit union members save for a rainy day. The chance to win a prize supports members' savings aspirations, and our findings provide additional evidence that prize-linked savings is effective in enabling financial security.,” said Timothy Flacke, Executive Director of Commonwealth.
“Minnesota Credit Unions are committed to improving the financial well-being of their members and consumers in Minnesota and we are pleased WINcentive is converting infrequent or non-savers into regular savers,” said Mark Cummins, president/CEO of the Minnesota Credit Union Network, the state’s trade association for credit unions.
Key findings from the study illustrate that WINcentive is helping Minnesotans save more and has impacted their attitudes and habits towards saving:
- Since opening a WINcentive account, 65% said they are currently saving a fixed amount regularly every month.
- Many (40%) respondents said that they were saving for a rainy day, 20% said they were saving for vacation, and 15% were saving for retirement.
- Thirty-three percent of respondents said that they did not save regularly prior to opening their WINcentive account. When asked how often they save in their WINcentive account now, 57% of those respondents said that they save a fixed amount regularly and 35% said they sometimes save when there’s something left.
- 67% of respondents who said they did save regularly prior to opening a WINcentive account, nearly half (48%) had only been saving sporadically through the month or whenever they had money left.
The analysis in this report comes from responses to a survey Commonwealth and MnCUN deployed between December 2019 and January 2020. The sample was comprised of respondents who have had their WINcentive account for at least three months, and excluded survey responses that provided insufficient information. Of 386 total responses, 363 responses were used in the analysis.