How to Develop an Automatic Savings Plan with SmartyPig

In David Bach’s book, “The Automatic Millionaire”, the author stresses the importance of developing an automatic savings plan so that you actually meet the financial goals that you have. We all want to save up and pay for new things such as a new car, a new television or a new computer, but we often lack the discipline to make that happen. By implementing an automatic savings plan, you can develop a savings plan to meet a specific financial goal and because of the discipline that an automatic savings plan forces upon you, you will meet that goal.

An automatic savings plan is essentially an automatic transfer out of your checking account into a savings account each month. Most online savings accounts will offer automatic transfers, but SmartyPig offers an online savings account that helps you identify your financial goal, then helps you develop a savings plan to meet that financial goal.

For example, let’s say that you wanted to save $1,500 for a new flat-screen television. SmartyPig would ask you when you wanted to meet that goal and then provide you a number as to how much money you need to save each month. If you wanted to meet that goal in 12 months, SmartyPig would tell you to save around $120.00 per month. Then, SmartyPig would setup an automatic transfer for that amount and categorize any funds related to that goal under a separate account.

Once you meet your financial goal using SmartyPig, you have a few options as to how you can redeem the funds. First, you can simply transfer the money back to your checking account. Alternatively, you can have a prepaid debit card with the balance of your savings goal placed on that to pay for your major purchase at any given retailer. Finally, you can redeem your funds in the form of gift cards and receive a bonus for doing so. For example, if you redeemed your funds in the form of Macy’s gift cards, you would get a 12% bonus on your savings goal.

SmartyPig’s online savings account is an excellent mix of an online savings account and financial tools that encourage you to be disciplined about savings. If you’re looking to begin an automatic savings plan, a SmartyPig account is worthy of your consideration. Click here to sign-up with SmartyPig.