bank rates

SmartyPig – Online Savings Account

ONLINE SAVINGS ACCOUNT

I’ve been hearing a lot of buzz about SmartyPig, a new online savings account that makes banking less boring. Their interface is colorful, intuitive, and fun.

A Fun Twist on Savings Accounts
You open an account with a minimum deposit of $25. Deposits are funded through ACH bank-to-bank transfers. Your money gets stored at West Bank, an FDIC insured bank. The best part is that you earn 4.30% APY interest (as of 3/22/08).

SmartyPig has some social-networking that differentiate them from traditional high interest savings accounts

  • You can set up a savings goal. Ie, if you need $1000 for rent or $1500 for a plasma TV
  • You can make your goals public so that your friends and family can see what you are saving $$ for.
  • People can give you $$ to help you reach your goal. Ie, if grandma sees that Junior is saving up $100 for a new tricycle, grandma can use SmartyPig to give Junior some cash. You can also add-on SmartyPig’s Facebook and Myspace applications to share your savings goals with the world. Who knows who might be inclined to help you out with some money?
  • If you decide to cash out your money in the form of a gift card (ie, Home Depot, Best Buy, etc) you can get up to 5% extra.

If you have an account with SmartyPig, you can contribute to other SmartyPig customer’s savings goals for free. Alternatively, you can contribute via credit card for a 2.9% processing fee. (If you use a 5% cash back credit card like the Citi CashReturns card, then you can actually make a few bucks.)

Although SmartPig just launched this month, I am very excited to see how it evolves. The management team seems very tech-savvy, and they are not afraid to embrace new trends and try different things to shape the way we do banking online.

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Comments (9)
1 Star2 Stars3 Stars4 Stars5 Stars (33 votes, average: 3.91 out of 5)
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9 Existing Comments
  1. brendan said:
    on March 25th at 12:51 pm

    10. How is interest paid?

    Interest is configured using a daily accrual method with quarterly postings to a customer’s account.

  2. sara said:
    on March 25th at 11:48 pm

    anyone have reviews of this bank?

  3. Justin said:
    on April 1st at 12:27 am

    For the investors out there looking for a place to temporarily hold their cash, this probably isn’t your answer. The most you can put in per month is $10,000. You can move everything from your bank account into SmartyPig, but can’t move it back. You can either get your money in the form of a Gift Card (eg. would be Best Buy) or a Debit Card. In other words, you cannot reverse the transfer of cash. Well, indirectly you could, but it would involve making many ATM visits, charges possibly incurred, etc. Not worth the hassle for the investor—good percentage…bad deal.

  4. tim said:
    on April 2nd at 06:25 am

    has anyone tried opening an account with them?

  5. Adam said:
    on April 19th at 04:37 pm

    Justin…Bad deal? I don’t believe this is intended to be a primary investment vehicle, rather a responsible alternative to utilizing debt for purchasing goods, etc. Given the increasing propensity of our nation to spend beyond our means, I think this is a great idea! It’s also a great tool for parents like me who would rather grandparents, etc. have the direct means to deposit money into this account for my kids rather than a normal savings account – truly a great networking idea. Great primary investment strategy – obviously not; great (responsible) alternative to credit – absolutely!

  6. Zero2Freedom said:
    on April 27th at 12:33 am

    Justin (and everyone)… according to the Q&A section there is also an option for getting a check mailed to you when you want your funds. And, there is no charge. It takes about the same amount of time as getting the gift or debit card.

    Also, check out the section about the executive team. Looks like a reputable list of professonionals heading this up… with a strong, publicly traded bank behind it. I will be investigating more and put my review here.

  7. ot said:
    on May 7th at 10:46 pm

    any more reviews?

  8. nuevo.donna said:
    on August 6th at 04:50 pm

    This company has one fatal flaw IMO. Yes, they have very competitive rates, yes, they have interesting features which assist you in organizing and staying current with savings goals. Here’s the problem, if there is anything remotely time sensitive about your goals, and you aren’t very careful you might end up royally screwed. Here’s the issue:

    1. You are REQUIRED to fund the account every month. You may NOT opt out. You have flexibility to alter the amount of the contribution, but you may not pre-emt it. It’s going to happen and once it does, your funds are locked in place. All of them are locked in place. In my case currently a monthly contribution of $29 was scheduled to occur on the 1st. It didn’t happen till the 3rd. Now when I try to close a savings goal totaling over $28,000, I’m told I may NOT close it out and have access to any of my funds until that tiny transfer of $29 is completed on the 10th!!!

    This is odd because according to their own faq, “ACH transactions take 3 business banking days to clear. SmartyPig defines funds as having cleared once SmartyPig has collected the funds and has full use of the funds.”

    When I finally get my money, I’m through with SmartyPig. However they may not be through with me. I’ve been saving these funds for 2 years for a surgery. If I miss it now because I’m unable to fund it in time, they WILL be hearing from my attorney. No company should be allowed to hold YOUR money hostage for such trivialities. This isn’t a CD. It’s a savings account.

    Don’t count on help from their customer service either in a matter like this because it won’t be forthcoming.

  9. jane said:
    on August 23rd at 09:11 pm

    i have a smarty pig account and you are wrong…u can do an ACH withdrawal to send your funds back to your account whenever you like, you just have to stop your goal to do so, but you can always start another right back up. And all your interests you’ve accrued goes right to your bank account with it. Great interest rates. I like it.