How Prize-Linked Savings Works
What if saving money felt as exciting as buying a lottery ticket — but you never lost a cent?
The Idea Behind Prize-Linked Savings
Let's be honest: saving money can feel boring. You put money away, it sits there, and maybe you earn a tiny bit of interest. Meanwhile, the excitement of a lottery ticket — the dream of winning something big — is hard to resist, even though the odds are terrible.
Prize-linked savings flips this on its head. Instead of earning traditional interest on your savings, you earn chances to win prizes. Every time you save, you get an entry into a draw. The more you save, the more chances you get. And here's the key difference from a lottery: you never lose your money. It's always yours.
Why It Actually Works
This isn't just a gimmick. There's real science behind it.
Behavioral economists have found that humans tend to overweight small probabilities. We get disproportionately excited about a small chance of winning something big, even when the expected value is low. This is why lotteries are so popular — it's not rational, but it's deeply human.
Prize-linked savings uses that same psychological pull, but channels it toward something productive. Instead of spending $20 on lottery tickets and getting nothing back, you save $20 and get a chance to win — while keeping every dollar you saved.
This Isn't New
Prize-linked savings has been around for decades, and it has a strong track record:
- •UK Premium Bonds (since 1956): The British government has been running prize-linked savings for nearly 70 years. Over 21 million people hold Premium Bonds, with over 117 billion pounds saved. Winners are drawn monthly.
- •Save to Win (US, since 2009): Credit unions across the United States launched prize-linked savings programs, and research showed they successfully reached people who had never saved before.
- •Similar programs run in South Africa, Mexico, and many other countries. The evidence is clear: people save more when there's a chance to win.
How UpPath Does It
UpPath brings prize-linked savings to Canada with a simple approach:
Log your savings
Tell us how much you saved this week or month. We don't connect to your bank — you just log the amount yourself.
Earn entries
For every $20 you save, you earn one entry into the monthly prize draw. You can earn up to 10 entries per month, so the maximum is $200 in savings per month for full entries.
Win prizes
Every month, winners are drawn from all entries. Prizes are funded by UpPath, not taken from your savings. Your savings stay yours, always.
It's Not Gambling
This is an important distinction. With gambling or a lottery, you spend money and it's gone. You're paying for a chance to win, and the odds are heavily stacked against you.
With prize-linked savings, you're saving money — money that stays in your pocket. The prize draw is a bonus on top of your savings, not a cost. Even if you never win a single prize, you still have every dollar you saved. That's the opposite of gambling.
Think of it this way: the worst-case scenario is that you end up with more money than you started with. Not a bad worst case.
Key Takeaway
Prize-linked savings harnesses the excitement of winning to help you build a savings habit. Your money is always yours — the prizes are just the cherry on top. Save $20, earn an entry, and keep every dollar no matter what.