Idea to Consider Savings Rate in Credit Score Wins Contest
Jonathan Chan, a 2010 graduate of Northwestern University, has won $50,000 for his idea “Savings Credit Score,” which would factor a person’s savings habits into their credit score as a positive indicator of creditworthiness, on the theory that a better saver can make a better borrower. Chan based the idea in part on his own experience trying to improve his credit score when he was in college, according to a press release.
More than 1,000 entries were submitted in response to TIAA-CREF’s call for innovative ideas to boost the U.S. personal savings rate to 10% over the next two years. As of October 2010, the U.S. personal savings rate was 5.7% (U.S. Department of Commerce), below that of most industrialized nations, the announcement said.
In addition to the grand prize, more than 12,000 votes were cast for a People’s Choice Award, which was based on online voting. Tara Tongco Rojas of Denver, Colorado wins $15,000 for creating the Women’s Savings Club, a community for women who commit to support, inspire and hold each other accountable for saving and managing money prudently.
Raise the Rate competition entries were judged by Maria Bartiromo, host of CNBC’s Closing Bell; Aaron Patzer, founder of Mint.com; Dan Ariely, author, Duke University professor and economist and head of the eRationality research group at the MIT Media Lab; and TIAA-CREF CEO Roger W. Ferguson, Jr. Judges evaluated the effectiveness, clarity, innovativeness and feasibility of each of the finalist’s submissions.