SmartyPig® Tag Feed for 'savings account'

An Economic Stimulus Plan for the Holidays

Jon Gaskell — Wed, 14 May 2008 17:11:00 -0400

Oh, I know. The holidays? Who's thinking about the holidays... in May? The answer may not be you, but you should be. Here's why: The so-called holiday hangover. What's the holiday hangover? It's the sting that millions of Americans are still feeling, as they receive their credit card statements each month. And when do they spend the most? You guessed it: the holidays. And they spend even more when they charge their gifts instead of paying in cash, getting caught up in the holiday spirit.

It's a habit you want to definitely want to avoid. And with 116 million Economic Stimulus checks en route or already delivered, nipping the holiday hangover in the bud has never been easier.

More than $2.2 trillion dollars was put on U.S. credit cards last year in purchases and cash advances. The companies handling those transactions charged $18.1 billion in late fees to their customers. And that was before the present credit crunch. Recently, Washington Mutual told its customers that it was raising its rates by as much as 100%. Discover is raising its penalty rate to 31%. Bank of America has tripled its rates for some of its customers. Who is suffering? Often times it is folks who not only pay on time but have had no change in their credit history.

Just think. You put a couple thousand bucks on your plastic next December for gifts for family and friends. Then, you get stuck and can only make the minimum monthly payment. How long will it take to pay that off? About 15 years.

Now, take that Economic Stimulus check and put it to work for you over the next six months, while adding to it a little each month and there won't be any credit card bills come next January. No holiday hangover. No regret. Just a chance - and for many the first time ever - to completely enjoy the holidays while creating memories, not reminders in the form of bills.

So again, are you saving up for the holidays? Reversing the credit card mindset of "buy now, pay later" needs to be your first step and you can start with your Stimulus check, because the idea of saving up before buying something makes more sense than ever.

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A Smarter Choice for Stimulus Checks

Jon Gaskell — Mon, 05 May 2008 17:05:00 -0400

While the federal government is hoping some 116 million American families waste no time spending their rebates from the Economic Stimulus Package, SmartyPig is an alternative for consumers who wish to do their part to boost the economy while also getting more for their money... and reinforcing the benefits of good financial habits through disciplined savings.

For consumers, this means that a $1,200 rebate check put toward a SmartyPig savings goal for just 90 days would result in an additional $12 or so in interest (at our current APY). Add that to a 5% cash incentive boost from a top retailer (retailers and boosts vary), as well as three minimum monthly deposits of $25 (a user must have a goal he or she is actively saving for), and Mr. John Q. Taxpayer suddenly has more than $1,350 instead of $1,200 to help stimulate the economy.

Now, if Mr. or Mrs. Taxpayer has two children and wants to create a goal for next holiday season, his or her $1,800 rebate check put toward a SmartyPig savings goal for 7 months would result in an additional $43 or so in interest. Add that to a 5% cash incentive boost from a top retailer, as well as seven minimum monthly deposits of $25, and Mr. or Mrs. Taxpayer suddenly has $2,119 instead of $1,800 to help stimulate the economy and NO credit card debt come January.

SmartyPig was created to make saving money a fun and educational experience for individuals and families alike. If we have to save the economy, as well, so be it.

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What's In Your Wallet May Be Wiping You Out

Jon Gaskell — Mon, 05 May 2008 17:04:00 -0400

We talk a lot about what people are saving for using SmartyPig. Almost all of the time these stories involve a very optimistic individual or family looking forward to a wedding or a vacation or a baby on the way. But there are other stories. They are no less optimistic, mind you. But they are tempered with some despair. They are about people who have been, or currently are, being held hostage by their credit cards, and are using SmartyPig as a way to get out from under.

To be honest, we have only heard from a few people who are using SmartyPig to actually help pay off high credit card bills. Mainly, we have heard from, and read about, people who are using SmartyPig to help reverse the mindset of "buy now, pay later." Many are using SmartyPig as a way to save up for the next holiday season, while (OUCH!) still paying off last year's shopping binge. In fact, December 2008 is our most popular month for scheduled redemptions in the next year - by 3 to 1.

Here's why: According to the public policy firm, Demos, more than $2.2 trillion dollars was put on U.S. credit cards last year in purchases and cash advances. The companies handling those transactions charged $18.1 billion in late fees to their customers (R.K. Hammer). And that was before the current credit crunch. Currently, credit card default is up 30% - highest since 1992. However, as these big financial services companies have no intention of taking it on the chin, they have made the decision to raise their rates. The headline in 'USA Today' last week was "Credit Card Rates Hustle Higher". According to the article, Washington Mutual told its customers that it was raising its rates by as much as 100%. Discover is raising its penalty rate to 31%. Bank of America has tripled its rates for some of its customers. Who is suffering? Often times it is folks who not only pay on time, but have had NO change in their credit history. "Hustle" indeed. In fact, the tactics are so brutal, federal regulators initiated steps last Friday to begin reining the hustlers in.

Coincidentally, MasterCard posted first-quarter earnings last week. The verdict? Profit more than doubled to $446.9 million. The stock is up nearly 30% this year. Why? Because in our economy's weakened state, more and more Americans are turning to plastic in order to survive. It's like McDonald's offering apple slices and salads after spending years making its customers overweight. The card companies have profited by putting you in a deep hole and now they're gong to profit even more while you are at the bottom, scraping like crazy to survive. Well, more and more we're seeing people who aren't going to be party to it.

So whether you want to teach your kids how to sensibly save so they don't end up where we are, or you cannot bear to grab your mail each day because of your past spending habits catching up with you, we know we can help you out. Reversing the mindset is the beginning, and the idea of saving up before buying something makes more sense than ever. In our opinion that old saying "Christmas comes but once a year" shouldn't include the stipulation that you'll be paying for it the ensuing eleven months. And with SmartyPig, you won't be.

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When Pigs Fly

Jon Gaskell — Mon, 21 Apr 2008 16:57:00 -0400

SmartyPig is getting terrific buzz. Awesome blog reviews and national coverage have led to an extraordinary amount of interest, which has led to a surprising number of customers and a high level of deposits. Exactly what we want. Just one problem: the transaction engine that moves your money into SmartyPig has a cap on the amount of money it will move in any one 24-hour period. Good news is you are making enough transactions to hit the cap. Bad news is, well, you're making enough transactions to hit the cap.

And, as Murphy's law prevails, we hit it over the weekend (when the 24-hour period is actually bundled into Saturday and Sunday); and customer support from the company that controls the transaction engine wasn't as supportive as we needed - kind of like getting the answering service when you really need to talk to the doctor. So as some tried to open accounts, add money to their goals or had automatic deposits scheduled, the error messages started popping up and the emails to our customer support center started coming in. We have spent the better part of the day trying to contact each individual who was inconvenienced to apologize and to let them know all is back to normal.

No customer's account will be affected negatively in any way whatsoever. But for about 30 hours things were not exactly perfect. Things, of course, are not always going to be. But I can guarantee you this: When something goes wrong, we will tell you (not spin you) the minute it does. We will work feverishly to fix it. We will explain in detail what happened after it is fixed. And then we will do our level best to ensure it never happens again.

Now, that all said, we are extremely excited at the level of interest we have received in such a short period of time, and we have expanded to meet customer demand. We really appreciate your business and your patience, and we want SmartyPig to evolve into what is most important to our customers, which, of course, does include actually working.

If any of you has a question or concern, I would really like you to contact me personally so we can discuss. My email address is jgaskell(at)smartypig(dot)com and the direct line to either myself or Mike Ferrari is 515.256.2086.

Thanks!
-Jon Gaskell, Co-Founder

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'Great Buzz' About SmartyPig

Jon Gaskell — Fri, 11 Apr 2008 16:52:00 -0400

Four weeks after going live, we are feeling what one member of the media called "great buzz". People are talking about SmartyPig. And, better yet, people are creating accounts on SmartyPig, setting up goals, inviting friends and family to help them along, and those people are setting up accounts, too... and telling others. Many others. Hence the buzz. This morning, we were excited to see the interview we have embedded here on WallStreetJournal.com.

We were likewise ecstatic to be featured on American Public Media's NPR featured program "Future Tense" which showcases the latest technology topics in daily five-minute capsules. "Future Tense" is heard in the United States during broadcasts of the CBC's "As it Happens. " Have a listen below: RealAudio - MP3 - iTunes

We will showcase SmartyPig at Finovate in a couple of weeks where we will be featured, along with a few dozen other start-ups, that are "innovating at the intersection of finance and technology" to an audience of hundreds of press, bloggers, analysts, VCs, industry leaders and banking executives. So we are definitely hoping to keep the buzz going.

We could not be more grateful for the kind words, the suggestions to make SmartyPig better, and, especially, the recommendations from our customers to others, telling them to help reverse the mindset of "buy now and pay later" by using SmartyPig.

Thanks!
- The SmartyPig Team

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Here's SmartyPig!

Jon Gaskell — Mon, 07 Apr 2008 16:51:00 -0400

We are extremely excited to introduce what we feel to be the most innovative, educational and rewarding way to save - ever. We call it "Simple, Smart, Savings." We're pretty sure you'll feel the same way. See, SmartyPig is not only a snap to use and is as secure as any other bank, SmartyPig will help you get more for your savings dollar than you ever thought possible.

In these scary economic times when credit card debt is skyrocketing, we feel the best way to help reverse the trend is to go back to the way things used to be. In our demo we ask the question, "Remember when you were a kid, and in order to buy something you had to save up?" In a nutshell, that is the idea behind SmartyPig. We want to help you get back on track. Phase out those credit cards. Set goals. Sensibly save up for them. Go back to the way it used to be... And be rewarded like never before for doing so.

We aren't suggesting you leave your current bank or to stop saving for the things you are already saving for like retirement or your kids' education or even your emergency fund. We just want to offer you a way to stop and smell the roses. You can start saving today for the holidays or a family vacation or a kitchen remodel without the worry of looming credit card debt - the kind that takes someone paying the minimum monthly amount on $1,000 more than 20 years to pay off.

So please explore the site, open an account, and if you find the experience to be rewarding, tell your friends and family members. For specific savings goals, we truly believe you'll find SmartyPig to be the most rewarding way to go.

Feel free to contact us at anytime. And please enjoy the experience of Simple, Smart Savings.

Thanks.
- The SmartyPig Team

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Fees Gone For SmartyPig Customers!

Jon Gaskell — Wed, 26 Mar 2008 16:48:00 -0400

We have completely revamped our public contribution and gift card fees. SmartyPig customers will now be able to make contributions to other users' goals at NO cost if they use their existing SmartyPig funding source, i.e. your checking or savings account. The fee to make a contribution or buy a SmartyPig gift card using a credit card is a flat 2.9%. We are also planning on implementing other payment and redemption options in the very near future, so that using SmartyPig will be economical for everyone.

Why the sudden shift? During Beta testing a few of our users pointed out that the social side of SmartyPig (making a public contribution, or "Giving the Gift of Savings") should be free - especially if a SmartyPig account holder was the one making the contribution. When our new customers echoed this sentiment, we acted fast.

See, not being a big financial institution has its advantages. We understand the user experience and customer service has to be exceptional and make it happen. Opening, funding and redeeming a goal with SmartyPig will always be absolutely FREE and our interest rate will always be competitive. But our trying to monetize the feature that makes us most unique was, in hindsight, an error in judgment. We're big enough to admit it. And we're nimble enough to make it right - fast. As for the 2.9% to use a credit card to make a public contribution, we have to cover these costs, and at the end of the day they are basically in line with the fee structures of other online payment methods. The good news is, anyone and everyone is only a few clicks away from having a goal (and we think everyone should have one) and thus being able to use all aspects of SmartyPig for FREE.

We hope this gives you confidence that we are listening and are able to react swiftly when changes need to be made. As I mentioned above, we are in the process of figuring out other payment and redemption options and implementing them in the near future. We welcome all comments and ideas.

Please e-mail us at anytime at support@smartypig.com or call 888-567-6278.

Thanks!
- The SmartyPig Team

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