Does UPromise Live Up to Its Name?
ningcontentI recently read a review of UPromise written by a blogger named modernmarvel. She’s a lawyer and a mother of three who has, so far, saved $500 – with the help of family and friends – through UPromise.
Although modernmarvel doesn’t knock it, she does have some things to say about UPromise that aren’t too promising (no pun intended).
Her first caveat comes in the form of a condition that must be met by all members who hope to retrieve the money they’ve saved … they must have “529 Plans” for their children. The 529 College Savings Plans – from section 529 of the IRS tax code authorizing them – are much like 401(k) plans. They are sponsored by states, state agencies, or educational institutions and come in two forms, prepaid and paid.
The prepaid 529 plans allow parents to lock in today’s tuition prices at a particular college or university. “They purchase credits or units at participating colleges and universities for future tuition and sometimes room and board,” according to the U. S. Securities and Exchange Commission. The paid 529 plans don’t allow tuition prices to be locked in. Parents simply invest in stocks and /or bonds with participating investment firms like Vanguard, Smith Barney, and T Rowe Price.
The need for a 529 Plan wasn’t a hindrance for modernmarvel because she already had them for two of her children. Unfortunately for her, UPromise discontinued its relationship with Fidelity, so modernmarvel will have to switch to another investment firm or risk forfeiting the $500 she’s already saved.
Modernmarvel’s next warning is about the lack of speed on the UPromise site. Pages take much too long to load, she said. It also takes several days for information to be processed when establishing a new account, and it can take anywhere from several weeks to several months or even a year for savings to be deposited into an account. If such delays aren’t a problem, then going to UPromise to help save for future college tuition might be worth it.
There are many ways to save with UPromise like registering credit cards so rewards go to a member’s account every time the registered card(s) is used. This is where friends and family can really be a help. By creating UPromise accounts and registering their credit cards, they help parents earn additional rebates. Modernmarvel’s friends and family contributed $200 of the overall $500 she has saved.
Online shopping, especially at participating online companies like ebay or travelocity, purchasing a meal in certain restaurants during certain times of the day, and using a registered credit card, can earn parents a 10% rebate. Grocery shopping in a participating store and using the store’s customer card, or purchasing certain products like Coke or Kellogg’s cereals can also help a UPromise member earn rebates, modest though they may be. For those who like giving MacDonald’s gift certificates, 3% rebates can be earned on each purchase.
Sometimes local stores can be registered with UPromise and rebates can be earned through credit card purchases. Modernmarvel cautions against using the UPromise Citibank Card, which deposits 1% of a saver’s total spending into his account, because she had a miserable experience with Citicard.
On the plus side of UPromise, modernmarvel said the site is user-friendly and they keep good records; however, because of the 529 Plan requirement, she said she wouldn’t recommend UPromise to anyone who didn’t feel a 529 college savings plan was a good fit for her.
