There are few things in life more exciting than buying your own home, planning your wedding, driving your fancy new car, or traveling to an exotic locale that you’ve always wanted to visit. There are also few things that wreak more havoc on one’s budget than paying for big dreams like those. Fortunately one Michigan company has created a way to bring those dreams one step closer to reality, particularly for the younger set.
“There’s a mindset, especially among younger people that they are not going to reach these goals and have the experience of the American dream that their parents have,” says John Morgan, the Founder and CEO of Detroit-based BoostUp.
He’s on a mission to change that perception and make those kinds of goals attainable again through a social savings platform that allows users set aside funds toward large goals like owning homes and cars.
At first blush that may just sound like a typical savings account, but what’s different about this idea is that family, friends, and even corporate partners can contribute too. All of them can kick something in to give the platform’s users a financial “boost up” toward their goal.
Imagine giving your relatives the opportunity to help you make your dreams come true, instead of wasting their time and money shopping for ugly Christmas sweaters or gift cards to stores you never shop in.
Here’s how the program works. Individuals create a free account and set up a financial goal towards buying a car, home, wedding or trip. They can deposit their own money from a checking or savings account and/or ask family and friends to contribute towards their goal. In some cases they can even set up an automatic paycheck withdrawal. The money is not at risk, and can be withdrawn without penalty if users change their minds.
The real bonus is that, along the way, savers may qualify for Partner Boosts, which are matching incentives from corporate partners. When a goal is reached or the person is ready to make a purchase, he/she can request to have these Boostup funds transferred toward the purchase. The incentive for corporate partners to make their contribution is to ensure that users do business with them when it’s time to buy.
Morgan says the concept was born out of his experience working in the automotive sector. “We were always trying to figure out how do we make a car purchase more attainable for people? Down payment is often a challenge, so what if we could make that easier?”
That ongoing question led to Morgan create the new platform, originally as part of his Synergy Marketing company in Chicago back in 2009. The move to Detroit happened in 2013, and was ignited by the city’s strong ties to the automotive industry, as well as investment interest from Detroit Venture Partners.
According to the CEO, the move has been very positive. “It’s probably been better than expected,” said Morgan. “There’s a big startup community in Chicago. You have the potential to get lost in a bunch of other things happening there. Here, it’s a smaller community, and there’s a lot of support. People’s willingness to help has been something we’ve been very surprised and happy about as a big benefit.”
With interest from Detroit Venture Partners, whose partners include Detroit mogul, Dan Gilbert, it’s not surprising that BoostUp took up residence in the M@dison Building, which is also owned by Gilbert, and home to several technology-based start-ups.
It also comes as no surprise then that one of the latest corporate partners to come on board with BoostUp’s program is the nation’s second largest retail home mortgage lender, Quicken Loans. Also a Detroit-based company that is owned primarily by Dan Gilbert, Quicken will allow BoostUp users to receive a free $750 Boost to apply toward closing fees on a new home financed by Quicken Loans.
“Saving up to buy a new home can seem like a daunting task, but between BoostUp’s innovative program and the $750 Boost we are providing our clients at closing, the dream of home ownership is closer to reality than ever before,” said Jay Farner, Quicken Loans President and Chief Marketing Officer.
Right now, in addition to homes, the BoostUp program is available for auto, wedding, and vacation purchases, but Morgan does not rule out the possibility of expanding into other areas. Once such addition may be the inclusion of college tuition, which he admits is the arena about which they are most frequently asked.