Life isn’t free. It’s a statement that rings true to many like myself just starting out in the working world. And watching and reading the news everyday is a constant reminder. Talk of bailouts and bankruptcies lead the headlines – everyday. The parts I understand are scary. The parts I don’t – scarier. But this much is true: In these troubling times, people either need to get moving back in the right direction, or if just beginning the journey, make sure they are starting off on the right foot. SmartyPig can help.
When the founders of SmartyPig set out on their journey to create the social money space they understood the key was a constant conversation with younger, tech-savvy individuals and their families about what they needed. SmartyPig is obviously for anyone who has a specific saving goal, but when it comes right down to it, it was created for people like me. I’m 22. I have college loans to pay. But I want to go on vacation this year. I want a new iPhone. And I cannot afford to get upside down with my plastic. So many of my friends are starting out in hole that seems terribly daunting, close to impossible to escape. Life isn’t free. They’re learning about it the hard way.
So if you ask me what SmartyPig does – and people always do – I have never changed my answer. Not once. “SmartyPig solves a problem.” SmartyPig offers a sensible, smart solution to prepare and educate people like me get started on a sound financial future. SmartyPig is simple to use, as Erin at The Broke Yuppie professes. And the ability to set your monthly contribution at a level comfortable to you means that anytime you’d like to edit your goal, it’s just a mouse click away. Setting a goal for years into the future along with automated monthly contributions, paves the way for good habits and a problem solved before it ever began.
Starting early is the key. Ask my friends. You make wise spending choices. Build a nice cushion to fall back on right out of the starting gate. And save up for the things you want. There’s no time like the present to start securing your future.
I never thought I’d relive the feeling I had as a kid going to see Mr. Jensen at Jensen Hardware in my tiny hometown in the mid-70s.
But, a couple of months ago, I found myself flashing back 35 years to when I would pull the white, plastic stopper out of my piggy bank (actually in the shape of a sitting cocker spaniel), spill the money onto the kitchen table and eagerly start counting.
If I had enough for the prized baseball bat or game at the hardware store, I’d shovel it all into my pants pockets and ride my bike like the wind uptown. Mr. Jensen was always ready to accept my $6.91 all in coins. In fact he seemed to get a kick out of helping me count it out.
Fast forward to 2009 and I’m walking into Sears in Des Moines, Iowa, cash in hand (figuratively, at least). And even though I was buying a stove and microwave — hardly as thrilling today as a baseball bat was 35 years ago — I was still pretty excited.
Because buying something without going into debt is just more exciting and pleasurable than loading it onto an already burdened credit card and figuring it out later.
The key was being smart enough to know my stove would not last forever. So I started a $67-a-month stove and microwave replacement fund. After a year of saving, I had $917 in the account. Unlike a physical piggy bank, SmartyPig pays interest. So my goal of $850 ended up above $900. That all combined to make a Sears store in Des Moines, Iowa, in 2009 feel a lot like Jensen’s Hardware in Lake Park, Iowa, circa 1974.
With one goal reached, I was eager to continue the $67-a-month withdrawal I’d become used to. So the refrigerator fund immediately took the place of the stove/microwave fund. I’ve since added the 25th-wedding-anniversary-trip fund.
As exciting as purchasing a major appliance with cash was, I bet going on a trip that’s already paid for will be twice as great. I can see the 1974 version of Mr. Jensen smiling right now.
Bill Zahren, @pressdog
After hearing about SmartyPig through a friend, Shannon Swilley knew our site was something she had to check out. Established in her career and recently engaged, she and her fiancee understood registering for gifts at a department store wasn’t something they were looking to do. They wanted to jump into life both feet first and buy a home. When they came across SmartyPig, they knew it would work for exactly what they wanted. Swilley was delighted that friends and family could contribute to this goal knowing that she and her fiancee were saving for the house as well. It was the ultimate gift – a life changer. Seeing SmartyPig as a total package, she set up a public goal and added the SmartyPig widget to her blog for readers to see.
As home mortgage rates dip to all time lows those interested in purchasing a new home have never found a better time to do so. But being financially prepared to purchase that new house by having enough money socked away is paramount to a successful start – especially in a market like this. So we’ve made it simple for you to save for a down payment on a house like Shannon by adding the new category, House Down Payment. Even better, with the social twist of SmartyPig, your friends and family members can help out!
It’s likely the second biggest decision Shannon has ever made. Using SmartyPig made it a bit easier. We congratulate her and all of our first-time home buyers!
Uncollected debt hit a record high, increasing 3% from February 2008 to February 2009. Write-downs increased 8.82%. Delinquency rates also rose above 6%. And aside from it all being grim news, what is even worse is that these numbers are expected to rise. In this piece from CNN, Moody’s credit card index predicts, “… The overwhelming influence of the negative economic environment should continue driving delinquencies to record-high levels by mid-year.” Pretty scary and disheartening, yes. But, more and more, our customers are telling us and the people they know that SmartyPig can help prevent these problems… permanently.
We understand that current economic times are more painful than ever, and many of us are nowhere near where we’d like to be financially. But we also know that two years ago, the average American spent $101 for every $100 he or she made, and today that same person is spending $95 and saving the other $5. That is tremendous progress; and it shows that there is no time like the present to begin creating good habits for the future. Saving money for bigger purchases instead of charging them and creating emergency funds for unexpected expenses are crucial elements in restoring financial stability across the country.
Credit lines are dwindling, available credit is shrinking and credit card companies are closing accounts in order to stabilize their bottom lines. Simply put: things will never be the same. It’s time to start saving for purchases, saving for emergencies, or simply saving to start becoming a saver. Charging now and paying later has helped to tip over an already wobbly economy.
Jessica at pjmommy.com recently wrote that she and her husband use their credit cards for a majority of their purchases and they, luckily, are able to pay their entire bill each month. But after she found SmartyPig and she realized that saving for purchases is all the more rewarding once you’ve met your goal, charging to plastic just isn’t all that great anymore. SmartyPig puts the fun back in your funds. And while you earn one of the highest APY’s on the market, your money does the work for you. Setting up your account is simple, and once you’ve started saving for your goals, you’ll wonder why you hassled with high interest rates and credit card payments in the first place.
How many times have you told yourself that you’d like to save more? That you want to use the extra funds in your checking account to get started? That it’s time to use the ease of the Internet to help guide you to a more prosperous future? That there is no better time like the present? And the… it goes nowhere. A few credit card charges here, some spare cash tossed around there and all of a sudden, you’re back to wishing that “whole new you” will take charge – next month.
In a recent guest post on Timothy Ferriss’s blog (The Four Day Work Week), Ramit Sethi (of I Will Teach You To Be Rich) stresses the importance of automating your finances. Sethi points out that taking even the tiniest of steps forward in automating your finances may be the push needed to jumpstart good financial habits. It’s as easy as just trying. Like the infomercial says, “Set it, and forget it.”
With SmartyPig, you decide how much you want to save, when you want to save it by, and SmartyPig does the rest. It’s automatic. On the day of the month that you’ve chosen, SmartyPig will pull those funds from your existing savings or checking account and place the money toward your goal while earning one of the most competitive APY interest rates in the country. Need an emergency fund in these trying times? We do that. Need to get away for a weekend wedding of a friend? We do that. Need to simply start saving first before you buy something? We do that better than anyone, and make it more worthwhile than ever before. And if you do have extra cash, you always have the option to add money at any time, as well. With SmartyPig, we work tirelessly to make it as simple as possible for you to sit back and watch your piggybank fill up.
So what are you saving for?