I don’t like to talk disparaging about other people or other companies.
You: So I’ve noticed.
Life is too short and the world is too small.
You: But you’re going to bad-mouth Upromise anyway?
No, I don’t really have an issue with Upromise itself. However, I am concerned about some of the people who have Upromise accounts.
Two reasons. First, because I’ve been asked various times at different speaking venues about my thoughts on Upromise as a key savings vehicle for college.
You: And the second reason?
Because I just received an email from Upromise on April 3 that began:
Dear Upromise member:
Congratulations — you’ve earned over $25 in your Upromise account.
You: Okay, so far so good. What’s the problem?
Here’s the thing: My former employer Toys “R” Us was, I believe, among the very first big merchants to join forces with Upromise (it was also one of the first big ones to discontinue its affiliation). As a result of my Toys “R” Us employee status and my financial bent, I decided to join Upromise and opened an account way back in May 2002.
You: That’s almost 7 years ago.
Indeed. My first daughter wasn’t born until nearly three years after I started participating with Upromise.
You: That is an early start for college saving.
It was an early start to think about saving for college. But participating in Upromise is NOT saving for college. Let’s be clear: Upromise participation is nothing like the miracle of compounding interest. There’s not much miraculous about Upromise. The premise is pretty simple: if you spend some of your everyday money with certain merchants (like Bed Bath and Beyond) and/or on certain products (Keebler), you’ll receive a small increase to your Upromise account.
You: How small?
Microscopic. And therein lies the problem. After seven years of Upromise participation,
You: You have over $25!
You: How much over $25 do you have?
I have just under $50 in my account at this moment. At this rate, when my oldest reaches college, I should have enough to buy her about three-quarters of one textbook.
You: So does Upromise suck? Should I quit Upromise?
No and no. There’s nothing wrong with accepting free money and this is fifty bucks I can use in 15 years that I did nothing to earn. For that I am grateful.
Still, some people do get excited about UPromise. When they do so in my presence, I politley tell them to calm down and explain to them how little it will matter in the end. More important, I explain, is look at and begin saving within a 529 plan. (Upromise says they can help with that too.) Not surprisingly, most of your kid’s education isn’t going to be paid with fruit crackers, it will be paid with the fruits of your labor.
At the end of the day, buying one text book used instead of new will do more to ease your college financing dilemma than Upromise will.
Have you checked your Upromise account balance lately?