Shop and Save for College: UPromise vs. BabyMint

I have joined both UPromise and BabyMint and have accumulated more than $400 of rebates with UPromise since 2004 when I actually started to use my Citi UPromise card regularly though I had the card and joined the program in 2002. I didn’t use BabyMint a lot, not because UPromise is better (well, in some areas, yes), but I started with UPromise much earlier than with BabyMint. Generally, I feel that both programs can provide some extra help when it comes to saving for college, and when started early and used wisely (especially the investing part), the savings can make a big difference 18 years later when my children go to colleges.

The followings are my experience with these two shop and save for college programs.

How they work

Both programs are free to join and work in almost identical way: join the program online (join BabyMint or UPromise), earn cashbacks by either shopping at their respective network merchants or in store using their respective credit cards, save and invest the rewards for future college education.

How to earn rebates

Both UPromise and BabyMint have their own network of merchants and, if you browse through them, you will find companies are likely to be in both networks. So if there’s no difference between network member merchants, how about the rebates one can earn to shop through them. That will depend on what you are looking for. Since I do most of my electronic shopping online, here are some the rebates offered by UPromise and BabyMint for some sites I used most often:

  • CircuitCity: UPromise – 3%*; BabyMint – 1.5%
  • CompUSA: UPromise – 1%; BabyMint – 2%
  • Staples: UPromise – 4%*; BabyMint – 2.5%
  • UPromise – 1%; BabyMint – 1%
  • BestBuy: UPromise – 2%; BabyMint – 1%

From my experience, BabyMint offers slightly higher rebates, but UPromise has a wider selection and, from time to time, it runs promotions with extra rebates (they are currently offering extra 2%* rebates through March 31, 2007).

The two programs also offer their own credit cards for members to shop in-store and earn cashbacks. However, the BabyMint College Savings Credit Card, issued by MBNA, appears to be terminated as I am not able to find any active link to the card. On the other hand, the UPromise MasterCard from Citi is still available, which basically gives 1% back for every eligible purchase and 2% cashback for filling up your car at Exxon Mobil station. In addition, there are additional 10% savings when you buy items with “UPromise” sign at grocery and drug stores.

How cashbacks are credited

The cashback you earned either by shopping online or off-line through these programs won’t be available immediately. In fact, there are some lengthy delays before you notice the credits on your statement and that delay could be as long as two months. For example, I made a purchase on July 28, 2006 at through BabyMint and the cashback was credited to my account on September 22, 2006. At UPromise, rebates for a transaction on January 31, 2007 was posted on March 6, 2007. However, at UPromise, a transaction made through the network shows up immediately with a “pending” status.

How to save for college tuition

What I like the most about these programs is that the cashback I earned can be automatically invested in a college savings account that’s linked to my UPromise or BabyMint account.

Every quarter, the cashback in the UPromise account can be transferred to either a UPromise College Fund managed by Vanguard or a state-sponsored 529 plan (Arkansas, New York, Iowa, Missouri, North Carolina, North Dakota, Pennsylvania, and Colorado). Similarly, rebates of $25 or more in a BabyMint account can be invested in any 529 plan or a Coverdell educational savings account linked to the account on a monthly basis. As you can see, BabyMint offers more investment choices (any 529 plan) with more flexible schedule (monthly). BabyMint, together with SAGE Scholars, also has a Tuition Rewards program that allows members to double their savings by redeeming the cashbacks as tuition credits at over 175 colleges and universities

In addition, cashbacks can also be used to pay off outstanding student loans.

How to save more

BabyMint has a referral programs that let members to save more by spreading the word. At BabyMint, every referral will receive 5 BabyMint Bucks when joining and after they accumulate at least $25 in their BabyMint account, you will receive 5 BabyMint Bucks as well. At UPromise, members can invite friends and family to join the program and allocate a portion of their cashbacks to your children’s savings account.

While both BabyMint and UPromise offer rebates when shopping through their member merchants, we should always look for the best price instead of having how much rebates we can earn as the first priority. After all, we don’t want to shop just for the sake of getting the cashbacks. Also, saving and investing for future college is a long-term project, and as any long-term investment plan, we should look beyond the returns to find the right plan. Other factors, mainly fees, are also critical in selecting a 529 plan (check out Morningstar’s best and worst 529 plans). It’s nice and convenient that BabyMint and UPromise allow us to transfer cashbacks to a linked college savings account, but that shouldn’t be the only criterion.

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17 Responses to “Shop and Save for College: UPromise vs. BabyMint”

  1. Super Saver |  Mar 21, 2007 at 9:39 pm


    Great rewards for your college savings account. I have only managed $0.07 credit for Upromise. I will be posting an article tomorrow and referring to your post.

  2. MossySF |  Mar 22, 2007 at 11:58 am

    Of course, the better option is instead of buying a $2000 LCD at BestBuy for a $40 rebate to the college fund — is to put the $2000 in the fund. :)

  3. Joseph Sangl |  Mar 22, 2007 at 1:48 pm

    I concur with MossySF. Put the money directly into a 529 plan or Coverdell Educational Savings IRA! Statistics continue to support the fact that when you buy with plastic – regardless of debit or credit, you will spend 12 – 18% more than if you pay with cash.

    I started a UPromise account a 4 years ago and have accumulated $0.00 in my account. Why? I have no credit cards! (I do, however, have a hefty sum in my child’s 529).

    Cash. It spends just like money!

  4. The Sun |  Mar 22, 2007 at 11:03 pm

    MossySF & Joe:

    Since I have credit cards all the time, I don’t a comparison on what my monthly bill will look like if I pay everything with cash, thus I don’t know if I overspend with credit cards or not. But I don’t think my spending decision is based on how easy I can pay the bill.

    While it’s true that the best option is always save the money instead of spending it, there are occasions that you do have to spend the money. In this case, getting some back and put it into a college savings plan from the money you have to spend is better than just spending the money without any rewards. I think the program doesn’t mean to encourage one to spend money (though the more you spend the more you get back). Actually, I only use those programs to get some extra help instead of using them as major sources of the contribution. I have college savings accounts for my daughter and have been making monthly contributions since she was born. Now she’s two-year old and there are more than $5,000 in her accounts. I am not counting on the cashbacks from these programs to put my daughter through college, but for those money I have to spend at grocery stores, I am happy to see that I can get a couple of percentage point of the total bill back and invest them.

  5. Bob |  Mar 26, 2007 at 4:40 pm

    I also use Upromise for my daughter and over the past few years the value of the account has gone up quite a bit without me realizing it.There are some things you have to buy anyways like Gas and grocery so why not use your credit card and get the rebate instead of paying cash.Also my discover card gives me cash back which is a double reward so I have never understood why some people prefer to pay cash instead of using a credit card.

  6. The Sun |  Mar 28, 2007 at 12:11 pm

    Bob: Well, that’s the question I asked myself many times as well: why people hate credit cards so much. One reason I heard a lot is that people tend to buy more stuff with CC than with cash. Since I almost charge everything with cards, I don’t really know what our spending will look if we pay everything with cash. But I do believe that there are lots of responsibilities involved in using cards. They can help you and they can break you as well. For those things that you know you have to buy anyway, like gas and grocery, why don’t get some back with credit cards?