Consumer credit is ubiquitous and the notion of saving up for something is almost foreign. But it's an essential step toward regaining control over spending, and SmartyPig wants to help.
Iowa-based SmartyPig offers a safe, secure way for consumers to save towards a specific goal—a wedding, remodeling project or vacation, for example—and it adds a dash of social networking and added incentives to speed up the process. Users begin using the free service by creating a profile on SmartyPig and establishing a savings account and goal amount—anywhere between USD 250 and USD 100,000. (SmartyPig's banking partner is 115-year-old, FDIC-insured West Bank, which has assets of more than USD 1.3 billion.) SmartyPig, in turn, suggests a monthly contribution in order to meet the savings goal by the time it's needed, and each month it deducts whatever amount the user chooses from their existing checking account or other funding source and puts it into the SmartyPig account.
To enlist the help of family and friends, users can choose to make their account public, enabling those they know to help them meet their goal; they can also put a SmartyPig widget on their MySpace or Facebook page to enlist the whole world's help. SmartyPig members can contribute to each other's accounts for free; to contribute via credit card, the fee is 2.9 percent. Once users reach their goal, they can receive their savings plus 4.30 percent (APY) interest on the SmartyPig MasterCard debit card, or they can get it plus interest and additional savings of up to 5 percent on a gift card from some of the country’s top retailers, including Amazon.com, Best Buy, Staples and Marriott.
SmartyPig just launched in February, with plans for a major publicity campaign to begin this month, but it was already awarded "Best of the Web" by NetBanker in March. It's open just to US consumers, however. Time to bring this concept to the credit-laden community near you! (Related: Layaway is back.)
Website: www.smartypig.com
Contact: support@smartypig.com
Spotted by: Sarah Johnson
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There are other, established, and more robust social networking/banking solutions that would work much better than this interest hog. In fact, more effective than this would be to put your money in an envelope in a sock drawer and then deposit it into a free savings account when you done. You have accomplished the same thing without losing access to your money in case of an emergency. If you want to get free money from people set up a Pay Pal donation button on your website(s) and beg for money with a well-written plea. Don't hold your breath waiting for that check to come in the mail...
PayPig is aptly named and hopefully no one falls for this foolish enterprise.
ok
I thought the SmartyPig idea was cool until I realized that your money becomes locked in a "Mastercard" or gift card account. This is just another revenue stream for Mastercard, not an encouraging way to save.
Patrick Broadgate | April 4, 2008 5:38 PM