Prize-linked savings (PLS) products hold great promise as a tool for improving savings outcomes for financially vulnerable Americans. In early 2011, Doorways to Dreams (D2D) Fund commissioned a panel survey of low-to-moderate income (LMI) households in five states. The objectives of this survey were to understand the appetite for prize-linked savings, in general, as well as to gather specific insight into LMI consumer preferences related to product features and marketing. In addition, the survey provided feedback on the Save to Win product construct currently deployed by the credit union industry in Michigan.
Prize-Linked Savings products offer the excitement and engagement necessary to make people want to save, rather than viewing it as a chore they’re unable to accomplish.
A single prize may seem too out of reach, making it less appealing, even if it is much larger. It’s better to make the chance to win higher.
A low barrier to entry is essential. If account holders can’t afford to regularly enter the raffle, the effort to save even more just to participate will take away the excitement.
The amount that is saved isn’t as important as the fact that the act of saving happened.
Participants preferred more smaller prizes, rather than a single large prize.
The $25 minimum to receive a raffle entry was seen as popular, as it’s a realistic amount to deposit regularly.
Respondents prefer to link their entry to an activity, rather than an amount.