In March, I opened a savings goal with SmartyPig, and I’ve been sending $172.20 from my ING Direct account every two weeks since then. My savings goal is to expand my collection of photography equipment to include a full-frame digital camera. I originally identified the Canon EOS 5D Mark II as my planned purchase, but rumors are pointing to the Mark III possibly being released next year.
Regardless of what I choose to purchase, or even if I decide I need to withdraw my funds an leave it in a bank account earning interest, SmartyPig will now help me reach that goal faster. The bank has increased its interest rate from 2.01% to 2.15% APY. This rate soars beyond practically every savings account, and as long as you have less than $50,000 total at SmartyPig, across all savings goals, this is the rate you will earn.
If your total balance is above $50,000, you will earn a lower rate of 0.5% APY.
SmartyPig is a bit different than a typical savings account. The bank wants you to keep your money deposited until your goal has been fulfilled. Although you can withdraw all of your money by closing your goal, you cannot withdraw part of your deposit without some maneuvering. Make sure you read these details to understand the limitations when comparing SmartyPig with a typical savings account.
Are you saving with SmartyPig? What is your saving goal and how do you like the account?
Updated October 13, 2010 and originally published May 19, 2010. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.