SmartyPig, SmartyPig

Happy New Year! Add a little rhythm to our post title and it turns out to be pretty clever!   Anyway, we’ve recently come across a great product that we’ve immediately put into use as we plan for 2010.  It’s called SmartyPig, and it’s basically an online bank that automates your savings for you.  It works particularly well if you are planning for a specific goal.  Here’s how we set our account up:

1. Go to the website and create an online account and login.  They are going to ask you for some personal information, the type of secure information that any bank will request when opening an account for you.
2. Next, SmartyPig will ask you to link your account to a funding source.  In doing so, you are setting it up so that funds can automatically be transferred between the two banks.
3. You’ll then have the opportunity to create one or more goals.  We’ve only got one right now—Christmas 2010.  You decide the goal you’re going to work towards (minimum $250) and the date by which you’d like to achieve it.  Our goal ends on October 31, 2010—just in time to get the shopping started.  SmartyPig offers about 2% interest on your deposits—fairly competitive right now as interest rates go.
4. Here’s where it gets pretty cool.  After you’ve made your initial deposit ($25), you can share your goal with the world.  They even give you the option to allow others to contribute to your specific goal!  It will look something like this:
5. Lastly, you have a couple of options when it comes to getting your money out.  You can get it transferred back to your bank, get it put on a SmartyPig MasterCard debit card, or redeem it for a gift card from a bunch of different retail partners.  When you redeem a portion of the money as a gift card, you also get up to 12% bonus on top of your 2% interest.  Since we usually make a big Amazon order around Christmas, we’ll be receiving a total of 6% on our money.  That’s pretty good interest if you ask us!
6. Don’t worry, if you decide to end your goal before it’s been reached, there is no penalty for withdrawing your funds early.

The idea of automating your short-term savings goal is a great option through SmartyPig.  We know that when Christmas comes around next year, the money we’ve budgeted will be right where we need it.  Add in the sharing component and interest bonuses, and it’s really an excellent service.  Have you tried it out before?  Let us know what you think!

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