System and method for automatically investing a portion of a credit card interest charged amount in an investment account

• US 6,070,153 A
• Filed: 11/21/1997
• Issued: 05/30/2000
• Est. Priority Date: 11/21/1997
• Status: Expired due to Fees

• Current Assignee: Mark S. Simpson
• Original Assignee: Mark S. Simpson
• Inventors: Simpson, Mark S.
• Primary Examiner(s): Trammell, James P.
• Assistant Examiner(s): Nguyen, Nga B.
• Application Number:
  US08/976,534
• Time in Patent Office: 921 Days
• Field of Search: 705/36, 705/408, 705/401, 705/35, 235/379, 235/380
• US Class Current: 705/36.00R
• CPC Class Codes: G06Q 20/10 specially adapted for electronic funds transfer [EFT] systems; specially adapted for home banking systems
• CPC Class Codes: G06Q 20/102 Bill distribution or payments
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

A system and methods for automatically investing, a portion of interest charged amount paid by the card issuer or the cardholder, on a credit card account, to an individual retirement account, taxpayer relief act of 1997 IRA, "Roth Act" or "Super IRA", college education IRA or spousal IRA (herein, collectively, "IRA"), college savings account, 401(K) plan (with or without linkage to a company expense account credit card), dividend reinvestment program (in stock of the card issuing company or otherwise) or other investment feature.

Claims

1. A method employed by an offering entity such as a credit card issuer, mutual fund or investment company or frequent flyer program sponsor, for using a computer having a memory with associated data processing means to create and operate credit and investment accounts for individual cardholder/investors and to provide for automatic investment into the investment account based upon a set percentage of interest charged comprising:

(a) selecting a percentage of interest charged and entering and storing the selected percentage into the memory of the computer;

(b) each time the cardholder/investor makes a purchase or processes a cash advance using a credit card of the offering entity, entering and storing a record of the purchase or advance in the computer memory, including the date and the amount of the purchase or advance;

(c) automatically calculating, by using the data processing means of the computer, a sum of total purchases and/or advances made by the cardholder/investor and the amount of interest charged to the cardholder/investor during a preselected period based on said sum; and

(d) under the control of the computer, automatically calculating an amount to be contributed by the offering entity to the cardholder/investor'"'"'s investment account by applying said selected percentage to the amount of interest charged to the cardholder/investor to establish an investment amount and automatically investing said investment amount on behalf of and for the credit of the cardholder/investor into the investment account and automatically issuing a statement to the cardholder/investor indicating said invested amount the balance and activity in the credit account and the balance and activity in the investment account.

2. The method according to claim 1 wherein said investment account is an individual retirement account.

3. A system used by a credit card issuer, for promoting retirement savings for a credit cardholder/investor while promoting purchases by the credit cardholder/investor of products or services from or through the credit card issuer, comprising of:

(a) central computer means with associated data storage means, data processing means and data input means;

(b) the data processing means, including means to establish a predetermined percentage of interest charged to the credit cardholder/investor;

(c) the central computer means including purchase tabulating means for automatically receiving and entering into the data storage means records of purchases and advances made by the credit cardholder/investor during a first preselected period, and for calculating a sum of total purchases and advances made during such first preselected period;

(d) the central computer means, including means for receiving and entering into the data storage means the amount of interest charged to the cardholder/investor for a second preselected period;

(e) the central computer means automatically calculating an investment amount to be transferred to an investment account based upon the amount of interest charged to the credit cardholder/investor by applying said predetermined percentage of interest to said amount of interest; and

(f) the central computer means including means for automatically transferring said investment amount to the investment account and for automatically issuing to the credit cardholder/investor a statement showing said investment amount.

4. The system according to claim 3 wherein said investment account is an individual retirement account.

5. A method of using a computer having a memory and associated data processing means for automatically funding an investment account in response to transactions using a credit card issued by an issuing facility comprising:

(a) using the computer to establish in the computer memory a credit account and an investment account for a cardholder;

(b) using the computer memory to store in the credit account information representative of a first amount charged by the cardholder using the credit card;

(c) using the data processing means of the computer to determine an interest amount which is based on said first amount;

(d) using the data processing means of the computer to determine a second amount which is a percentage of said interest amount;

(e) using the computer to establish a funding account of the issuing facility; and

(f) using the data processing means of the computer for periodically transferring information from said funding account to said investment account which is representative of said second amount.

6. The method according to claim 5 wherein said investment account is an individual retirement account.

7. The method of using a computer having a memory and data processing means to provide for automatic investing in response to use of a credit card issued by an issuing entity comprising:

(a) using the computer memory to establish a credit account and an investment account for a cardholder who is issued a credit card by the issuing entity;

(b) using the computer memory to establish a funding account of the issuing entity;

(c) using the data processing means of the computer to determine a first amount which is representative of charges incurred by use of the credit card by the cardholder during a predetermined period and storing information representative of that amount in the computer memory;

(d) using the data processing means of the computer to determine an interest amount based on said first amount and storing information representative of the interest amount in the computer memory;

(e) using the data processing means of the computer to determine an investment amount which is a percentage of said interest amount; and

(f) using the data processing means of the computer for periodically transferring information representative of said investment amount from funding account to said investment account.

8. The method of claim 7 wherein the information representative of said investment amount is transferred to said investment account in response to payment of said first interest amount by the cardholder.

9. The method of funding an investment account by a credit card issuer for the benefit of a credit cardholder in response to use by the cardholder of a credit card issued by the credit card issuer comprising the steps of:

(a) establishing a credit account and an investment account by the credit card issuer for the benefit of the credit cardholder;

(b) establishing a funding account of the credit card issuer;

(c) issuing a credit card by the credit card issuer to the credit cardholder;

(d) determining a first amount which is representative of charges incurred by use of the credit card by the cardholder during a predetermined period;

(e) determining an interest amount based on said first amount;

(f) determining an investment amount which is a percentage of said interest amount; and

(g) periodically transferring information representative of said investment amount from said finding account to said investment account.