Personal finance tip: A trend in the financial world that started a few years back in different states of the United States. It definitely sounds like a doable plan. It’s called Prize-Linked Savings Accounts (PLSA, also called a lottery-linked deposit account). These accounts have been offered around the world, however, in the USA, only certain states offer them. The goal is to get more people to save money. It works something like this.
- The credit union account holder makes a deposit of $25.
- Each time he or she makes a $25 deposit, they have a chance at winning a jackpot; and/or some of the smaller prizes, which are also monetary rewards.
- The size of the jackpot depends on the sponsor. Singular cash prizes range from $5000 to as high as $25,000.
“A new type of savings account offers a lottery-style thrill of potential cash.”
This is sort of like the lottery. That’s kind of how it’s advertised.
For me, it’s better than the lottery. The lottery is just gambling. Flat out. You spend your money, and if you don’t win anything, you lose your money.
With the prize-linked savings, even if you don’t win the grand prize, you don’t lose your money!
How is that like the lottery??
Quite frankly, this is an idea that is long overdue.
Think about it.
– A lot of people object to gambling for various reasons, which is why many people don’t participate in the lottery.
– Most people say they would save money, if they could! They have no moral or ethical or legal qualms or questions about saving whatsoever!
Do additional research on:
– American Savings Promotion Act (H.R. 3374), legislative authority
NOTE: Banks don’t offer these accounts but credit unions do.
Anyway … not going to get all worked up about it because the credit unions in Texas (where I live) don’t offer these types of accounts. YET!
But don’t you think this kind of incentive really does encourage people to save money??