Prizes to encourage saving

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Living paycheck-to-paycheck is a common way of life in Hawaii — because of our high cost of living.

In order to help more people save, credit unions and banks will now be able to encourage people to open accounts — using prizes as encouragement.

Money.

We work so hard to earn it.

But far too few of us save it.

A new law signed by Governor David Ige makes it legal for Hawaii’s banks and credit unions to offer chances to win prizes — to people who open savings accounts.

State Representative Nadine Nakamura introduced the bill — after learning about the idea from her daughter.

Further research Nakamura did, found that more than half the other states offer similar, prize-linked savings programs.

“So this is how we can get low-income people to actually save, and it’s an incentive. Hopefully they can use that to you know, money to fix their car, or save up for college, save up for health expenses, that might come up.”

In Hawaii it is illegal for any contest offering prizes, to collect an entry fee — because that, would be gambling.

Iris Ikeda is the state Commissioner of Financial Institutions — and she says getting people to deposit money in a savings account for a chance to win a prize — is not gambling.

“It’s not really like a typical contest so to speak, where you might not get anything at the end, you’re still getting your savings account.”

For generations, banks have offered gifts when opening a new account — but this is different because depositors only get a chance to win a prize.

But like Ikeda says — even if depositors don’t win anything — they still have their money in the bank.

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