Wouldn’t it be great if you were eligible to win a cash prize just for putting money in your savings account? In next month’s election, your vote for Proposition 7 could make this a reality in Texas. This policy proposal to encourage more Texans to save is much needed in our state and country. Over 46 percent of Americans do not have enough money to cover an unexpected $400 expense.
Proposition 7 makes savings a fun and exciting experience
The Texas Legislature approved the policy proposal (HB 471 and HJR 37), which put Proposition 7 on the November ballot. This proposal gives banks and credit unions the ability to offer chances to win cash prizes for Texans who are making deposits into a savings account. This constitutional amendment is needed because the Texas Constitution prohibits banks from awarding these types of prizes. Half the country already allows banks and credit unions to do this.
Prize-linked savings accounts are normal savings accounts with the added incentive of the chance to win a cash prize for making deposits
- These accounts have the same fees and offer the same interest as other comparable savings accounts at the financial institution offering the account.
- The accountholder’s savings are never at risk in the account. Their savings are maintained in the account whether or not they win a prize.
Proposition 7 will help financially insecure households build savings
- Since 2009, over 75,000 prize-linked savings accounts have been opened nationwide with a collective savings of $175 million and average account savings of over $2,400.
- 82 to 89 percent of prize-linked savings accountholders are financially vulnerable.
- 49-59 percent of prize-linked savings accountholders had no emergency savings before saving in the account.
Proposition 7 will benefit financial institutions offering prize-linked savings accounts
- Prize-linked savings helps financial intuitions acquire new customers. 10 to 15 percent of prize-linked savings account holders became members of their credit union in order to open a prize-linked savings account.
- Prize-linked savings increases customer interest in other financial products. 62 percent of prize-linked savings account holders said that their financial institution’s prize-linked savings product has made them more interested in using other products offered by their financial institution.
Vote yes on this innovative strategy to help Texans build savings!
Learn more about Proposition 7 here. Early voting starts October 23.
Prop 7 is also supported by our partners at:
Faith in Texas
Community Development Corporation of Brownsville
Independent Bankers Association of Texas
Dallas Women’s Foundation
Brazos Valley Affordable Housing Corporation
United Way of Southern Cameron County
Lubbock Housing Finance Corporation