A friend recently introduced me to the tool Digit, a “digital savings assistant” which helps you squirrel away money. It works by linking to your checking account and analyzing your spending patterns. When it notices you have a little extra money that you’re not using, it sucks it away into your FDIC-insured Digit savings account.
This smart little service is really great for both meticulous savers, and those who haven’t gotten the hang of budgeting yet.
If You’re a Saver: If you, like me, like to keep immaculate control of your finances, Digit could be a huge help! Every payday, I spend a lot of time figuring out how much I can send to my savings account versus how much I should keep in my checking. Even setting up automatic transfers can be cause for worry. What if I transfer too much and there’s a bill I’ve forgotten about? I could overdraft and get hit with a bunch of fees! Digit has a no-overdraft guarantee to assure you that you’ll never make that mistake. It’s like setting up a smart auto-transfer to savings–one that is guaranteed to never get you in trouble for trying to be responsible with your money
If You’re a Spender: Digit will pull money from your account in small increments when it realizes you don’t need it. If you don’t have the discipline to tuck away that dollar for a rainy day, Digit will help you do that. In turn, this could help you spend less on frivolous things, since you won’t have that big chunk of cash sitting in your checking account!
What else is good about Digit? It has an awesome interface that you can communicate with via text messages. It will let you know how much you’ve saved, and even help you keep track of your bills! If you need to withdraw money, it will have the funds in your account within a day–much faster than conventional ACH transfers. It’s also just as secure as your own bank account.
Any downsides? Well, there’s no interest on their savings account. However, this doesn’t seem like a big issue to me unless you already have a huge amount of savings, with savings rates being what they are these days. Also, if you don’t use texting, you miss out on a lot of the friendly communications the platform offers.
All in all, it seems like a great product that will help me save some dough for my next vacation!