A recent article in Kiplinger’s Personal Finance mentioned a fairly new “Christmas Club” way of saving. Smarty Pig is a new FDIC insured savings program offered by Iowa’s West Bank. It allows you to set up multiple accounts (for free) with designated goals. So, you can have one for a down payment for a new home and one for Christmas gifts (plus many more). There is even a great tool that tells you how much to save. If you tell Smarty Pig that you need $20,000 for a down payment on a home in 4 years, it will calculate that amount that you need to save per month to reach that goal. You can link the accounts to a checking account of your choice and transfer money back and forth or have Smarty Pig do it automatically each month.
The great thing about Smarty Pig is that you can make your goals (and accounts) public. Since it is public, you can allow family members and friends help you reach your goal. That is, they can transfer money into your accounts! You can even place a link on sites such as Facebook, MySpace, blogs and websites to help you meet your goals faster!
Another great aspect of this account is that it is currently paying 3.9% APY! That is one of the highest out there right now. You can also redeem your savings for a gift card to different business with a bonus of up to 5%. So if one of your goals was for home improvement, you can then use that savings to get a Home Depot gift card with a bonus!
Have you had some experience with Smarty Pig? Feel free to share your thoughts on your experience or what you think of this idea in general. I think this is a great concept and should be offered everywhere!
SmartPig brings a nice new dimension to savings accounts and having the goals you can share with others via things like Facebook is a good way of keeping you on track.
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