Doorways to Dreams Fund works to improve financial security for vulnerable consumers. They have pioneered prize-linked savings programs which reward savings deposits with prizes. These programs increase savings by appealing to consumers' interests in games and prizes. Studies show that over 50,000 unique accounts have been opened through prize-linked savings, with most savers being low-to-moderate income or non-savers previously. For credit unions, prize-linked savings programs increase customer loyalty, reach new markets, and position them as innovative leaders, helping to increase overall product use.

1. ©Doorways to Dreams Fund, 2016
Improving Financial Confidence and Stability through
Prize-Linked Savings

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About D2D
Doorways to Dreams (D2D) Fund strengthens the financial opportunity and security of financially
vulnerable consumers by discovering ideas, piloting solutions, and driving innovations to scale.
 National nonprofit, HQ in Boston; founded in 2000 by then Harvard Business School Professor Peter Tufano
 Example innovations: Save to Win, Financial Entertainment, Rainy Day Reserve prepaid savings pocket,
SavingsQuest gamified emergency savings, FinCapDev, Save Your Refund national tax-time savings national
sweepstakes, and hackathons
 Examples of supporters & collaborators:

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Prize-linked Savings Create Financial Security and Self-Efficacy
 Traditional savings products don’t work for all consumers
 Rewarding consumer behavior drives consumer behavior
 Prize-linked savings products offer a different experience
 Prize-linked savings increase savings and financial wellbeing
 Prize-linked savings strengthen Credit Unions

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Consumer Behavior Insights: Saving

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We all know that saving money is good
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Icons by The Noun Project

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But we are not great at it
35%of households don’t have a savings
account (CFED, 2016)
44% of households lack savings to cover
basic needs for 3 months (CFED, 2013)
5.4%Personal savings rate
Icons by The Noun Project

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Why are we so bad at saving?
Thinking about needs of our future selves can be difficult and stressful
Traditional savings products are not fun
There is no immediate reward for saving
Icons by The Noun Project

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What does this mean for vulnerable consumers?
 Lack of savings presents a greater
challenge for financially vulnerable
consumers
 FV consumers have low access to other
financial resources
 Low- and middle-income
consumers are more likely to
experience income volatility (US
Financial Diaries)
 More than 5 months a year, the
average USFD family’s income is
25% above or below their median
income (US Financial Diaries)
 40% of households don’t have enough
savings to cover 3 months of expenses
 30% of households don’t have access to
revolving credit (CFED, 2016)
In Connecticut
credit insurance
financial
flexibility
social
networks
Icons by The Noun Project

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Consumer Behavior Insights: Prizes

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We love games, and winning!
 $68.8 billion in US lottery sales (2012)
 Average of $515+ per household
 On average, households earning <$12.4k /
year spend 5% of their income on lotteries
 80% of gambling revenue from
households w/ income <$50k
“38% of those with incomes
below $25,000 think that
winning the lottery represents
the most practical way for
them to accumulate several
hundred thousand dollars.”
-Study by the Consumer Federation of America

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Why financially vulnerable households gamble
savings
bills
fun!
Gambling:
 Entertaining!
 Aspirational!
 Easy!
 Instantly gratifying!
Icons by The Noun Project

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Rewarding behavior drives behavior
Credit card providers know this Game and fitness app developers know this

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About Prize-Linked Savings

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Prize-linked Savings Accounts
Accounts that award prizes as part of the
saving product’s return
Save to Win
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Icons by The Noun Project

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How Prize-linked Savings Work for Consumers
Creating savings

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How PLS creates savings
Exciting prospect and aspiration of winning
gets consumers to TRY
Simple call to action helps consumers
succeed at saving
Hearing about winners in their
communities keeps consumers engaged
in the short term
Seeing themselves succeed gets
consumers to create a habit
$$$
Icons by The Noun Project

17. ©Doorways to Dreams Fund, 2016
Why financially vulnerable households gamble
savings
bills
fun!
Gambling:
 Entertaining!
 Aspirational!
 Easy!
 Instantly gratifying!
Icons by The Noun Project

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Why financially vulnerable households gamble
savings
bills
fun!
Gambling PLS:
 Entertaining!
 Aspirational!
 Easy!
 Instantly gratifying!
Icons by The Noun Project

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How we know it works
Over $115 million saved
 In CT, over $480,000 in first year
Over 50,000 Unique Accounts have been opened
 In CT, 560 accounts in first year
Approximately 10% join their CU to open a PLS
account
Almost ¾ of Accountholders have never had a CD

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How we know it works
Asset Poor:
33% (NC)-49% (WA)
Low-to-Moderate Income:
36% (MI) -55% (NC)
Non-Savers:
42% (NE)- 59% (WA)
Any Financial Vulnerability:
62% (NE)- 81% (WA)

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How Prize-linked Savings Work for Consumers
Building financial security

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How PLS makes a difference
Trying
committed
savings
products Building assets
Managing debtsuccessfully
saving
Covering
emergencies
Building
balances
Accumulating
reliable long-
term reserve
Self-efficacy
Financial
Wellbeing!!

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Focusing on savings
leads to broad financial
mindfulness
“...It just really has changed our lives.
I’m much more aware of our money,
where it is, how we’re spending money,
and where we want to be. It has
completely changed my plans. It’s a
good change. It really made sure that
we’re focusing on the right things.”
- Martha

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Feeling of success in
saving turns into
increased financial self-
efficacy
“Save to Win changed my whole life.
Save to Win has made me think about
my savings and spending. It's just there,
and I'm doing so much better. I have an
emergency fund, I'm paying down my
debt. I don't even know what the prizes
are anymore, but, Save to Win, it's
changed me; it's changed how I feel
about my future.”
- Martha

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Habit of saving results
in a reliable reserve
“[Save to Win] has really given me an
opportunity to have somewhere to
start… It makes me really say ‘there is a
place for my money and there is
somewhere I can save it and there is
someplace I can do it on a consistent
basis.’ It really has given me a
foundation… and even if you are
financially savvy or financially ignorant,
it still gives you somewhere to start
gaging and saying ‘oh, well you know,
from here I can do much more.’”
- Julia

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Increased sense of
financial self-efficacy
expands use of financial
products
“Only now, and the inspiration truly for
me was Save to Win, [have I been able]
to put money aside and pretend it’s not
there, it’s never been there, and let that
money grow and give us some
comfort.”
-Silvia

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How Prize-linked Savings Work for Credit Unions

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PLS Footprint
Global
 South Africa
 UK
 Sweden
 Latin America
 Middle East
US: 100 credit unions
CT, 2015!
8 credit unions

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How PLS work for credit unions
Increase customer loyalty Reach a new market of consumers:
non-savers
“I like the fact that
the credit union is
open to new things
and to build our
financial stability.”
20%
don’t have a
savings account*
20%
Unbanked or
underbanked*
*In CT, CFED 2016

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How PLS work for credit unions
Position yourself as an innovative
leader
Increase product use
67%
Building savings would
make me more likely to
use other financial
products at this credit
union

31. ©Doorways to Dreams Fund, 2016
Contact Information
Andrea Vasquez
Innovation Strategist
D2D Fund, Inc.
avasquez@d2dfund.org
D2Dfund.org
SavetoWin.org