College Savings Credit Card: UPromise credit card
By Ben Woolsey
Editor's note: This story, while accurate at the time it was written in 2005, has become outdated. The Upromise card is offered by Bank of America.
Most people realize that in today's financial marketplace there are credit cards that offer savings through 0 percent APR or ones that offer great rewards. But now, there is a way to actually leverage everyday credit card spending to apply rewards toward higher education for your children or other family members.
The pioneer in the arena is an organization called Upromise, which was started about five years ago in the northeast to enable parents to earn credit card rewards by shopping with participating merchants. The program was taken a step further by adding a credit card component a few years later in partnership with Citibank. It is possible to belong to the program without getting the Citi Upromise Credit Card, but the earnings accumulate much faster when rewards are earned on every dollar spent on a credit card. The basic rewards program is free to join and use. The Credit Card has no annual fee and offers 0 percent APR balance transfers for 12 months.
The way the program works is quite simple. Consumers can go to the organization's website to register any credit card they own and use at www.Upromise.com. Then, rewards are automatically recorded and stored in the customer's password-protected account online. The rewards can also be transferred out of the account at certain intervals into a tax-deferred 529 account that can allow the funds to grow through managed investments.
A truly unique feature of the program is that it allows multiple cards and multiple individuals to sign up for the benefit of a single child's education fund. That way parents, grandparents, aunts, uncles, cousins and friends of the family can join together to harness their everyday spending to help add to a child's education savings. And, the program operates independently from any existing rewards program that the individuals may have on their credit cards. Therefore, so no one involved has to forgo their own points, miles or cash back rewards.
So, is it a smart move to get the Citi Upromise Credit Card? That's ultimately a personal decision a parent must make, relative to the other great credit cards available. But, if you have young children, it may make perfect sense to take advantage of your personal spending, and potentially the credit card spending of friends and relatives, to help fund such a major and important expense in life.
Published: October 21, 2005
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