With all the doom and gloom you hear about the cost of college and student loans, there are companies out there offering innovative new ways for students to save money and pay down their student loans. The SmarterBucks rewards program, offered by SimpleTuition, is a traditional debit card with a few unique benefits specifically designed for students. SmarterBucks acts like any other debit card, but with every purchase made students earn rewards that become extra student debt payments on any student loan, whether private or federal. The program works whether you are graduated or still in school, so students can effectively start paying down their debt before they have even started repayment.
Recently we had the chance to catch up with Doug Lowenstein, EVP of SmarterBucks and SmarterBank®. Here’s what he had to say about the program
What was the motivation behind creating SmarterBucks?
SmarterBucks was created by the team behind SimpleTuition, which has been dedicated to college affordability for years. We’ve always tried to help students and families pay less for college. Now we’re trying to get them out of debt faster. SmarterBucks is part of that mission, and we built it to help the 37 million people with student loan debt in America. The goal of SmarterBucks is to help those people chip away at their debt. It’s all about the power of extra student loan payments, which our members earn through everyday spending.
How does SmarterBucks work?
SmarterBucks was built from the ground up to be both powerful and easy. Members sign up—for free, mind you—and tell us which student loan they want to pay down using their rewards. Then they start earning rewards by:
- Shopping with their favorite brands at our SmarterBucks Marketplace and earning up to 10% back in rewards from retailers like the Apple Store, Target.com, Banana Republic, J. Crew, Groupon, and more. Or they can register any Visa® or MasterCard® to earn rewards on in-store purchases at many of the same retailers.
- Inviting friends and family to earn rewards for them or contribute directly to their account using a credit card—which means members can start asking for gifts in the form of SmarterBucks.
- Applying for a SmarterBank Visa® Debit Card, which earns SmarterBucks on everyday purchases like groceries and gas.
What might be even better: once members start earning rewards, there is nothing they need to do to redeem them. Every month they have at least $15 in earned rewards, we’ll automatically make an extra student loan payment for that amount on their behalf.
How is SmarterBucks different from other rewards programs?
There are lots of rewards programs out there, but we are the only one that is exclusively focused on helping our members pay off their student loans. Plus, the nature of debt repayment makes our rewards worth more than their face value. Think about it this way: if you earn $15 in SmarterBucks and contribute that toward a student loan, you’ve not only paid off $15 in debt, you’ve avoided paying accruing interest on that $15 for the rest of your loan’s repayment period. Depending on your interest rate and how much of your repayment period you have left, your $15 extra payment could reduce the total cost of your debt by $30 or even $45.