Accrue Savings Review 2023: How Brands Help You Save Now, Buy Later

Buy now, pay later services are a staple of online shopping these days. If you can’t afford something at checkout, third-party companies offer to break up the purchase into smaller payments, usually interest-free.

But a new company called Accrue Savings is trying to entice consumers with a more old-school approach: Save now, buy later.

Instead of purchasing the item today, you set aside money in an account each week or month. Participating companies chip in with rewards as an incentive to help you meet your savings goal.

But the fintech startup is still in its infancy and only available at about 30 or so small retailers. Accrue Savings also isn’t a bank, so in some ways, you might be better off setting up automatic deposits into a high-yield savings account on your own.

Is Accrue Savings worth the hype, and what are some other alternatives to help you pay for your next big-ticket purchase?

Here’s what you need to know.

What Is Accrue Savings?

New York-based Accrue Savings launched in late 2021 with an alluring elevator pitch: Give customers incentives to save up for big purchases.

As the company notes on its website: “Saving up and buying later means cash rewards, no debt, credit or fees.”

Accrue Savings was named one of Time Magazine’s top 200 inventions of 2022 for “encouraging people to save now with a new kind of layaway for the digital–banking era.”

How Does Accrue Savings Work?

Accrue Savings provides an FDIC-insured bank account that can be used to make purchases with a handful of participating brands.

To be clear: Accrue Savings is not a bank. It’s a fintech company with banking services provided by Blue Ridge Bank.

Here are the basic steps of buying an item through Accrue Savings:

1. Create an account, choose the product you want to buy and create a purchasing plan.
2. Make regular, scheduled deposits into your account.
3. Earn rewards from the company you’re buying a product from.
4. Save up the full amount, cash in your rewards and buy the product.

You can customize your Accrue Savings plan from five to 15 payments, and contribute as little as a few bucks a week to as much as $100 a day toward your goal.

You also get the option to skip a payment or pause your payment plan.

Accrue Savings doesn’t pay interest on your deposits like a traditional savings account. Instead, the company pays rewards once you reach your savings goal.

Rewards vary by merchant, but can be as high as 20% of the purchase price. So if you’re saving up for a $800 mattress, you could get up to $160 toward your goal.

However, when we checked, most merchants offered a 10% reward, and several only provided a 1% to 2% contribution.

Benefits of Accrue Savings

We love the idea of gradually saving up for big purchases instead of racking up high-interest credit card debt.

Accrue Savings can be a great option for people with poor credit or no credit. Because you’re saving up to buy an item instead of using a credit card or taking out a short-term loan, there’s no possibility for late payments or default. That means your credit report won’t be impacted.

There’s no cost to use Accrue Savings either. You can take your money out at any time without penalty. No fees or hidden costs is always nice.

You also get the option to invite friends and family to help contribute toward your goal. Leveraging crowdfunding can help you get the item you want faster.

Drawbacks of Accrue Savings

Accrue Savings has one huge downside: It’s only partnered with a small group of merchants. A lot of them are luxury jewelry, fashion and sunglasses brands.

There’s a good chance the item you want to buy isn’t eligible for Accrue Savings.

Accrue told The Penny Hoarder that it plans to add more brands each month, including “large and small merchants in the travel, furniture and auto industry.”

But for now, the selection is limited.

The most recognizable participating merchants include: 

• Smile Direct Club
• American Signature Furniture
• Equinox Fitness Group
• Casper Mattresses

Another drawback: Rewards can only be redeemed for purchases at the brand you’re saving for — they can’t be exchanged for cash. If you decide not to move forward with the purchase, you’ll get your money back but lose any rewards.

Finally, finding information about Accrue Savings is somewhat difficult. Its website is pretty basic and it takes a while to locate the nitty-gritty details about how the service works.

Alternatives to Accrue Savings

Accrue Savings posters itself as a “first of its kind” way to save up for pricey items — but the service is far from revolutionary.

If you’re eyeing a big ticket purchase, there are a few other ways to pay for it.

Save Up on Your Own With a High-Yield Savings Account

Accrue Savings offers you a way to save up money over time — but there’s nothing to stop you from saving money on your own.

You won’t get those extra rewards, but you can still earn extra money by accumulating interest in a high-yield savings account.

High interest rates are great news for savers. High-yield savings accounts are fetching their best APYs in years, with a 4% rate or higher at some online banks.

You won’t earn a ton of extra money this way unless you make a big initial deposit. But every little bit helps, right?

Let’s imagine you open your high-yield savings account with $100 and you contribute $100 a month for 12 months. At a 4% APY, you’ll have accumulated an extra $26 in interest after 12 months (assuming the interest compounds monthly).

Buy Now, Pay Later

Buy now, pay later apps are an increasingly popular way to finance purchases.

Companies like Affirm, AfterPay and Klarna let you split the cost of everyday purchases — from running shoes to groceries — into several installment payments.

You don’t need a good credit score to qualify for buy now, pay later, and payments are usually interest free. Some people see it as an attractive alternative to high-interest credit cards.

But buy now, pay later isn’t free money. It’s a short-term loan, and the business model has faced criticism from regulators and consumer protection advocates.

It’s easy to overextend yourself by taking out several buy now, pay later loans in a row. It’s also incredibly tempting to buy stuff you can’t really afford simply because the initial payment is a fraction of the actual cost.

If you use buy now, pay later services responsibly — aka taking out just one BNPL loan at a time — they can be a useful way to spread out the cost of purchases. Just proceed with caution.

Layaway

Layaway plans are the OG way to finance a big purchase over time.

You pay a deposit to put the item on hold at a store. (The seller may charge you a fee for the service). You pay the rest of the cost over time, and the store gives you the item after it’s fully paid for.

Unlike buy now, pay later, layaway programs make you wait for the item you want until you’ve paid for it in full. It’s similar to Accrue Savings, except you don’t earn rewards along the way.

Layaway options aren’t as common as they used to be. Walmart, for example, offered a layaway program for years until it ditched the practice in 2021.

Several retailers only offer layaway plans during the holiday season.

Amazon is the largest retailer with a layaway option, though it’s only available on select items sold directly by Amazon.

Rachel Christian is a Certified Educator in Personal Finance and a senior writer for The Penny Hoarder. She focuses on retirement, investing, taxes and life insurance.