What is Upromise?

Upromise
Upromise

A college savings program

In 2001, a new rewards program launched to help parents save towards their college education. Named Upromise, the program promised parents to help save towards 529 plans much like a credit card cash back program or frequent flier program. The program has grown far more sophisticated in the 10 years since, offering more rebates and cash back than virtually any other rewards program. It's no wonder that Salie Mae was anxious to acquire Upromise, which it did in 2006.

Earning rewards

There are many ways for Upromise members to earn rewards. The simplest is to shop through the Upromise website. Doing so offers members a percentage of cash back through hundreds of popular online retailers. Registering your credit cards through Upromise will offer you a number of ways to get cash back since Upromise will monitor your purchases and make offer rewards any time a purchase is made on one of those cards with a Upromise partner.

Some of the many ways you can earn include purchases at the grocery store, certain restaurants, the pharmacy, and gas purchases. For more information on the specifics, check out my Upromise review.

Redeeming rewards

Upromise markets itself as a way to help save towards college. However, there's really no need to use the earnings that way. They provide the following ways to redeem your Upromise rewards.

  • Directly applying the funds to a 529 account approved by Upromise
  • Using the rewards to pay down a Sallie Mae loan
  • Having the money directly deposited into a Sallie Mae High Yield Savings Account
  • Collecting a check
Of course, either of the last two methods would make the money available to apply towards college, but it would also be just as available for a new TV. The Salie Mae savings account has a very competitive interest rate, so I collect my funds that way.

Amount of earnings

Realistically, there's no way you're going to pay for all of college with Upromise earnings, but don't scoff at the amounts you can save either. I'm on pace for about $150 this year. That's not a ton, but our daughter was just born. $150 a year for the next 18 years invested in a mutual fund that earns an average of 8% will total over $6000 by the time she enters college. That's a fraction of what college will cost then, but it should come pretty close to covering her books, which still ain't bad for something that cost me nothing.

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