SmartyPig: The Virtual Piggy Bank

Posted by Jill on May 11, 2010

A little over a year ago, I won a SmartyPig gift card. I had heard of SmartyPig, but since I had an established ING account as well as a few others, I had never seriously considered opening an account there.

Once I got the gift card though, I decided to try out SmartyPig Bank. Since then, I’ve moved most of my targeted savings to Smarty Pig, while keeping my emergency fund and “just because” savings at ING.

Smarty Pig used to be a little limiting in terms of how often you contributed and how you could make withdrawals, but has rapidly responded to customer feedback and drastically improved its functionality.

SmartyPig Bank Review

  • How it works: You open targeted goals, with a target date and amount. For example, vacation fund of $2,500 by August 15. You then tell SmartyPig how often you want to contribute and it creates an automatic savings plan, where you contribute a set amount each period (monthly, weekly, biweekly, etc).
  • Interest Rate: 2.01% APY, accrued daily and paid quarterly. It’s hard to beat SmartyPig rates right now.
  • Minimum Contribution: $25 initial contribution plus at least $10 per month
  • Fees: None
  • Withdrawals: Upon reaching and closing your savings goals, transfer to bank account, receive a debit card, or redeem for a gift card (plus bonus!) to one of several business partners
  • Interaction: You can post your goals to Facebook or Twitter, or send an email to your family members and friends. With your permission, anyone can see your progress, and even make a contribution to help out.
  • Insurance: SmartyPig funds are held with West Bank and are insured by the FDIC to the full legal maximum, currently $250,000 per account holder

My SmartyPig Experience

I’m currently using Smarty Pig to save for 5 goals, each with a target date less than a year away. For each, I told SmartyPig how much I wanted to save and by what date, and that I wanted to contribute on the 15th and 30th of each month (when I get paid). SmartyPig then calculated how much I needed to contribute each paycheck to meet my goals. I linked my primary checking account (it had a little trouble linking to another online savings account), and authorized SmartyPig to initiate automatic transfers. Each account transfer is made separately – $30 per paycheck for goal #1, $60 per check for goal #2, etc. Like any ACH transfer, the deposits take about 3-4 days from start to finish.

Smarty Pig has a great interface that allows me to see graphs showing how much I contribute each month, and how much I have left to meet any of my goals. I can move funds between goals at any time and change the target date or amount.

I actually have yet to make a withdrawal from my SmartyPig account – my first goal is ending in May, so when I do close and withdraw I’ll be sure to write about it! But the option to get gift cards with bonuses is definitely appealing. Even once I meet my goals, the money can stay in the account and continue earning interest until I’m ready to withdraw. The only thing I don’t love is that once you close a goal and make a withdrawal, you have to withdraw the whole amount. Of course a way to get around that is to figure out how much you actually need and transfer the rest to another goal before completing the withdrawal.

Bottom Line

SmartyPig’s interest rate is one of the best available on the web, making it tempting to put all your money there. Theoretically you could create a new goal with a very high target amount to simply stash your regular savings. But when it comes time to tap those savings for an emergency or anything else, you may have to do a little finagling if you don’t wish to withdraw the whole amount. For that reason, I maintain my accounts at ING Direct and a traditional brick-and-mortar bank.

For targeted savings goals and earning extra bonuses on your withdrawals, SmartyPig can’t be beat. A gift card is also a great way to set up a young friend or relative with their own virtual piggy bank, helping them save for a specific goal.

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Comments to SmartyPig: The Virtual Piggy Bank

  1. You should mention the 50k limit across all goals to earn the top rate. If your credited balance (not including accrued interest) goes over 50k, the entire amount earns just 0.50%. Once your account balance goes back below 50k you would start earning the higher rate again. This comes into effect at some point next week.


    • Thanks for the update Andy! Everyone will have to keep an eye on their account balances to make sure they earn the higher rate.


  2. Great Post, Jill! I will notify my Facebook fans on this also. Using technology to save for goals like vacations, Christmas, cars, etc. may be easier for the digital generation.

    Whether you use Smarty Pig….or the old fashioned piggy bank, we gotta save more money. If this is an idea that helps, I am all for it.

    Dean Voelker

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