For your convenience I link to many of the products I mention. Many of these links are affiliate links which means I may earn money if you purchase a product I recommend.
Saving money is kind of hard.
I don’t mean just in the living frugally sense. I mean being able to keep money in your bank and not spend it.
A few years ago I started putting my emergency fund in a completely different bank account to make it a little bit harder to “accidentally” use.
It has worked great for me and I highly recommend this method.
There is a lot of truth in the old saying “out of sight, out of mind.”
Even though this system works for me, I’m always trying to find new inventive ways of saving money and recently read about Digit.
Digit is a FDIC insured company that uses a computer algorithm to transfer small amounts of money from your regular checking account to a Digit savings account.
The transfers are done based on your spending & deposit habits.
The system can tell how much extra you have in your account and will periodically make small transfers from your account into your Digit account.
If you struggle to save money, I highly recommend trying Digit out. Even if you are like me and have savings accounts for your savings accounts I still recommend the program.
I’m the type that really likes to have control of my money, so I was really hesitant to try it out. However, as a personal financial blogger, I love trying new things and finding products that may help my readers.
Digit is a product I’ve used and will now recommend.
Setting up Digit was super easy. I created a login (which included phone & email verification) and then linked my bank account.
The whole process took me less than 5 minutes.
Three months later I have saved just under $200 in my Digit account.
I’m rolling in the dough, huh.
I know, it is a very small amount, however, it is a little bit of extra money that is now being saved for our next vacation. As I continue to use their system I can guarantee this money will continue to grow.
What I like about the Digit system is that I didn’t even “notice” the money was gone. I check my accounts daily, so I knew it was gone, but the amounts weren’t enough to cause issues with my budgeting.
It was almost like I had chosen to eat out a few more times than normal.
The missing money was never enough to get my pain receptors going, but was just enough to actually add up.
I love how simple and easy it is to quickly save a little bit of extra money.
What I like about Digit
1. Found Money
Digit’s greatest strength, in my opinion, is the concept of found money. It is really easy to look at our bank accounts and think because you have a balance you can keep spending.
If you are budgeting and controlling your money hopefully this isn’t your mentality. However, even when you aren’t paying attention it is easy to fall into the mind trap that the money is there and as a result can be spent.
Digit takes little bits of extra “found” money throughout the month.
These small amounts aren’t even noticeable to most people. However, as you begin to add the little amounts up, they can quickly become larger amounts.
2. Easy to set up and use
I had my account set up and ready to go in less than 5 minutes. From there, I would receive periodic emails with updates on my balance. I didn’t have to do any extra work or monitor anything in the system.
The system takes care of all of the work associated with saving money. To be honest, that could be a positive or a negative, but I’m choosing to view it as a positive.
3. Overdraft Guarantee
Digit guarantees that you will not overdraft as a result of their transfers or they will cover the fees. If you keep a super low balance you may want to watch your accounts, but overall, the amounts were insignificant enough on my end to never be a concern.
4. Regular Communication
This could be a negative or positive depending on your view of texts. Digit texts you regularly with updates on your banking balances and how much they are trasferring to your savings account. I personally love it, but I’m kind of OCD about my money. You can turn off this feature if you’d rather not have the updates.
Other Positive Features:
- State of the art security features including the fact that your personal information is anonymized, encrypted and securely stored
- All funds are FDIC insured up to $250,000
- Funds available for transfer to your bank 24/7/365
- No withdrawal fees
My Concerns about the Digit system:
1. Lack of control
Digit controls how much and when money is taken from your account.
Even though they have the overdraft guarantee, there is still that little part of me that stresses about allowing a random computer algorithm to take money from my account. It is just hard for my OCD personal financial nature.
So far, the algorithm has been perfect and I’ve never even come close to over-drafting my account, but the chance is always there.
2. Interest Rate
Interest rates are pitiful everywhere, so to be honest, I’m not sure this really matters.
With Digit, you don’t earn interest on your money until you’ve had three consecutive months of deposit.
Once you are eligible to earn interest, the rate is 1%. On a positive note, this is the same rate I’m currently earning in my regular saving account.
If you run the numbers, I’m currently making .16 cents per month on my balance of 200.
3. Monthly Fee
Digit has a monthly fee of $2.99 that they begin to charge after 100 days. This isn’t a huge amount, but you will need to have $3,500 in your account before you’ll offset the monthly charge with a 1% interest rate.
Will I continue to use Digit?
When I first ran the numbers and realized the balance I’d need to keep in my account to offset the monthly charge my immediate answer was no.
However, after using Digit’s I’ve come to really like the concept. It is such a simple easy way to save money. My Digit review changed the way I viewed this product.
I love the fact that Digit does all of the work for me.
It just runs in the background and the money just keeps adding up.
I’m not sure if I’ll continue to use it indefinitely, but for now, I’m going to use it for another 3-6 months and see what happens.
If you already have a great savings plan in place, I don’t see this program being particularly beneficial to you, unless you are like me and just like to try stuff out.
However, if you are looking for a new way to save money, or need a boost to your self-control, I highly recommend giving Digit a try.
If you are looking for other ways of saving money you may want to check out these posts:
Money Saving Posts:
- 14 Money Saving Tips to Lower Your Grocery Bill
- 5 ways to Stop Spending Creep from Destroying Your Budget
- How to Cheat Your Clothing Budget and Still Dress in Style
- How to Avoid Busting Your Budget
PS. It has been 6 months and I know have $1,258.27 saved up. Last month I made $.78 in interest and was charged $2.99. This means technically I lost $2.21. However, I don’t think I would have saved this much money on my own. As a result, I’m still keeping this financial tool in my recommend bucket.
Join the Intentional Living Revolution
I love to help my readers transform their lives.
Join for weekly updates on Personal Finance, Parenting & The Fun Things in Life.