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SmartyPig Savings Account Opening Review

This article was written by in Banking, Reviews. 26 comments.

For two years, SmartyPig has been making so-called high-yield savings accounts look bad. The 1.00% APY currently offered is not a sky-high interest rate, but it beats just about every other major bank.

Two years after introducing SmartyPig with a $100 giveaway, and after SmartyPig made some important changes to their fee structure, I decided to open an account.

SmartyPig’s focus is on savings goals. I see this as a natural extension of ING Direct‘s easy sub-accounts. In order to add money to your SmartyPig account once opened, you must create a savings goal, like a full emergency fund, a car, or your second semester at Harvard Business School. If you don’t have a specific goal, you can get past this step by choosing “miscellaneous,” though SmartyPig encourages you to find something to save for.

Banking Deal: Earn 1.75% APY on an FDIC-insured money market account at CIT Bank.

Like Discover Bank and Sallie Mae Bank, the account opening process was free of problems. Here are my impressions so far.

Opening a SmartyPig Savings Account

Update: SmartyPig has been selected as the winner of the First Annual Plutus Award for Best Savings or Money Market Account!

SmartyPig - What You'll NeedThe first thing you might notice is that “SmartyPig” does not sound like a traditional bank name like, “First National Federal Bank of Metropolis.” SmartyPig is an arm of West Bank of Des Moines, Iowa. West Bank is a member of FDIC, so despite the non-traditional name, your accounts there will be federally insured up to the allowed limits.

You will need all the basics in order to open an account with SmartyPig, including an official ID, social security number, and a permanent address. After accepting the terms and conditions and the electronic delivery disclosure, you will be asked to enter your personal information. From the beginning, you will be asked to create five security questions, select a security phrase, and choose an image that will help assure you you are visiting the right website. These are all common security measures.

SmartyPig requires an email address, and once you provide one, you will not be able to continue with the account opening process until you retrieve a registration code sent to that address. When I went through this process, it took about two minutes to receive the registration code.

SmartyPig - Identity Check QuestionsThe next step allows SmartyPig to verify your identity. The bank will query your credit report to pull random information to ask you in the form of multiple choice questions. If you answer incorrectly twice, your application will be canceled and you will be required to wait 72 before starting over.

If everything goes well, however, you will soon be presented with your SmartyPig profile, where the bank will encourage you to set up your savings account.

Add your friends to your SmartyPig profile

Before adding my first savings goal, I wanted to link my account with two of my friends who have their own SmartyPig accounts. Yes, SmartyPig is a “social” bank. You have the option of sharing your goals with your friends or the public, and anyone can contribute to your savings goal. SmartyPig makes it easy for others to deposit money directly into your account. You can search for friends to add only by entering their email addresses.

I also took the time to add a profile picture to my account.

Creating your savings account and goals.

You can create any number of savings goals on SmartyPig, but first you must create and fund a savings account to hold those goals. The account must be funded through ACH, so have the bank account number and routing number for your linked checking or savings account available. Once the information is verified, you can set up your first savings goal.

For lack of anything better at the moment, I chose to save for a Canon EOS 5D Mark II, a new camera I’ve been eying. You will set a savings target, an initial deposit of at least $25, and a recurring deposit from a linked bank account. I chose to transfer an amount biweekly on the same day I receive my paycheck.

SmartyPig - Social Saving

SmartyPig is the first bank that “gets” social networking. After setting up your goal, the bank will encourage you to share the news with your friends on Facebook, Twitter, or your own website.

Withdrawing your money from SmartyPig

SmartyPig - WithdrawalsIf your savings goal is really a “spending goal,” like my example, then you may be interested in the withdrawal method most favored by the bank. SmartyPig has partnered with a number of retailers to offer discounted gift cards. If you reach your goal, SmartyPig will fund a gift card of your choice with a bonus of up to 12%.

The second option for withdrawing the cash you have accumulated is through a reusable SmartyPig-branded MasterCard debit card.

Although the bank discourages ending your goal and withdrawing your money prematurely, SmartyPig now allows you to make ACH withdrawals for free. At any time, you can withdraw all of the cash saved towards a goal at any point.

Since SmartyPig encourages customers to leave cash in their account until their goals are complete, SmartyPig customers withdraw funds less than customers of other banks. The average savings goal is four years away, so the bank can afford to offer interest rates that have more in common with long-term certificates of deposit.

As Consumerism Commentary reader Jaime G has pointed out, you cannot designate a SmartyPig account for joint ownership (only “co-ownership”), nor can you at this time designate a beneficiary.


In addition to savings goals, SmartyPig is a great option for a portion of your emergency fund. Now that you can withdraw your savings through ACH for free, there is no reason not to take advantage of SmartyPig’s higher interest rate for any savings you don’t need within two business days if you don’t mind withdrawing the entire goal. My initial ACH transfers into the account was slower than I would like, but if you plan on letting your cash earn compounding interest, the interest rate makes it worthwhile.

Interestingly, SmartyPig does not have a routing number nor do customers receive an account number. You cannot use an outside source to initiate ACH transfers, nor can you set up direct deposit of your paycheck.

Note: A SmartyPig public relations representative wrote in to clarify that you cannot withdraw partial goals — you must wait for the goal to be completed or withdraw all of the funds saved towards that goal. I’ve clarified the text above. Additionally, the representative wished to point out that ACH transfers take an industry-standard two business days.

What are your thoughts about SmartyPig?

Bank data

SmartyPig (West Bank)
Routing (ABA) number N/A
Established January 1, 1893
FDIC certificate 15614
Savings interest rates 1.75% APY as of October 1, 2010
Location 1601 22nd Street, West Des Moines, Iowa
Direct Connect Not supported
Web Connect Not supported
Mint/Yodlee Supported

Updated June 23, 2016 and originally published March 18, 2010.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 26 comments… read them below or add one }

avatar 1 Anonymous

I *love* the idea of Smartypig, but will not open an account with them solely because they do not offer a true joint account owner option or beneficiary designation. So, if anything happens to me, my family only gets the money after court process. Not a big deal if you’re saving $500, but can be a big deal if your savings goal is a heftier sum. Just a thought. We’re using Discover Bank’s online savings and are pleased with it so far (formerly eTrade customers).

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avatar 2 Luke Landes

That’s an interesting issue, and I took that for granted. I understand that SmartyPig will soon offer a beneficiary option for these accounts but they might never offer full joint ownership (although full joint ownership *is* described in their disclosure). The “co-ownership” they do offer is not the same thing — a co-owner cannot close the account or end a goal.

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avatar 3 Anonymous

My late sister had a SmartyPig account. The “no beneficiary” problem has proved extremely difficult. While much larger accounts with others have been paid out, SmartyPig doesn’t seem to know how to pay a beneficiary.

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avatar 4 Anonymous

That’s a very good review. One thing to note is that West Bank has announced in its last quarterly report that SmartyPig has grown too big for them, and they plan to transfer SmartyPig to a larger bank. Hopefully, they’ll find a bank that will keep the interest rate as competitive as it has been over the last two years.

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avatar 5 Luke Landes

That’s good to know. Thanks, Ken!

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avatar 6 Anonymous

It appears that the interest rate is now currently 0.75%, down from 1%

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avatar 7 Anonymous

I use SmartyPig and I like it a lot. I didn’t know about the co-owner vs. joint ownership thing…good to know.

I used to like it when you couldn’t turn off the automatic deposits without ending the goal (thus forcing you to withdraw all of the savings in that goal at once). That made it easier for me to save, since I did not want to have to close a goal, only to have to reopen it later.

Now they’ve changed that and you can quit making contributions and start back up whenever you’re ready, and you can also take out just a portion of the money, which is beneficial if you’re having a bit of a crisis, but just makes it too easy to quit the forced, routine saving. I guess I’ll have to go back to having the savings debited out immediately so it doesn’t even end up in the paycheck…how weak I am!

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avatar 8 Anonymous

can you make multiple goals, and, are there limits or restrictions to reach the goals? My goals: 1-airfare tickets $600, 2-camera for $500, 3-clothing for $300? And, for next 2 months put in $700, so that by the 3rd month, you redeem for the retailer gift-cards for 1) AA, get 3% SmartPig boost, 2) WorstBuy, get 2% SmartPig, and 3) Macys, get 12% SmartPig boost? Can i use my credit card to fund account to reach goal? Will credit card company treat it as purchase? Does SmartPig at West Bank code transaction as a service transaction purchase (and not as cash advance)?

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avatar 9 Anonymous

I wish to invest the insured max of $250,000 in a six months CD with a decent return. Any

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avatar 10 Anonymous

I also did not consider SmartyPig to be an option due to the lack of a beneficiary, but according to their new terms and conditions dated May 8, 2010, they now offer a POD or Payable on Death beneficiary.

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avatar 11 Anonymous

Would love to receive a suggestion not involving a “D” or below “D” rated bank about investying
in a 6 months CD with a return above 1%.

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avatar 12 Anonymous

When I came across the 2% yield, given this low interest rate environment, I became very interested in smartypig. Given that they now have a POD account (according to askmrlee), the beneficiary concern is less important. In response to Ralph, as long has they have FDIC insurance, your deposits are insured up to $250,000. So wherever you put your cash, make sure they have FDIC insurance. Then your money is insured no matter what.
Flexo, your review provided a nice overview and intro into the pros and cons of smartypig. I’m off to their site to proceed. Thanks.
(PS Welcome to Yakesie)

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avatar 13 Anonymous

one thing to note is that there is a different rate for balances greater than $50,000. i was all set to open an account and transfer a large amount, and then i noticed the fine print at the bottom of the page:

*Annual Percentage Yield (APY) is effective as of 7/22/2010. Balances $0.00 – $50,000.00 earn 2.133% (2.15% APY). Balances above $50,000.00 earn 0.499% (0.50% APY).

i’d rather not have to open multiple accounts, so i’ll probably stick with one of the traditional banks.

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avatar 14 Anonymous

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.

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avatar 15 Anonymous

Agreed – the minutia of setting up goals has led to 100% of the time I am unable to withdraw funds when i need them. It is a huge flaw with the product. The forced holding of funds that they implement is not integrated into the goal setup process which is ridiculous so the math it does when it auto calculates the withdrawal amounts to meet your goal always results in a minimal amount being leftover and delaying your ability to withdraw the funds when you need them. I have tried multiple times to try and game this issue and it hasn’t worked = product being completely useless.

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avatar 16 Anonymous

Donna –
Get Insurance before you have your surgery. You cannot be rfefused any more because of
pre-existing conditions. Good luck

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avatar 17 Anonymous

Actually, Donna, you are way off on a few things. First of all, you don’t have to set up monthly recurring transactions. There is a choice of “none” on how often you want money taken out. Secondly, if you had talked to customer service you may have found that they would have allowed you to close your goal early since the last transaction was so small. I know that is something they have allowed in rare circumstances in the past. The issue is that in those 3 days after your money posts, your bank can go in and take it back. So they gave you your money, only to have your bank take it back, so they are OUT the money that you just put in. However, since it was a small amount they may have taken the risk. Next time, try working with customer service and you may find that they are quite willing to work with you. I know they were when I called them. Which leads to my third point, their customer service team is a good group of people. You can tell they are from Iowa and have that “country living” mentality. They were so nice to me and answered my call quicker than any other customer service that I’ve called. I highly recommend them to anyone.

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avatar 18 Anonymous

No where do I see the 6 ACH limit restrictions as all savings and MMA accounts have, so unless someone knows otherwise, this is more like a checking account. But it’s not a checking account because they don’t offer checks, bill pay or an ATM card — although you can cash out into a debit card and then use that as an ATM card, and there is no routing number or checking number associated with this account. I guess this could really be called a piggy-bank account and it really is the first of its kind.

The best way to get around all the negatives is to be clever with your “saving goals.” Right away you should create two “emergency” goals and put as much as you feel you need — dividing that in half to put in each goal — so if you have to cash out right away, such as for an emergency operation, then you can since one of the two goals will never be locked up since you fund one and wait till it’s unlocked before funding the other; also if you do need to fund it then only fund each at $500 at a time so you can at most of the time close out both, so you would then create another 2 goals called “funding for emergency” to slowly over time fund up to that $500 ($1000 for both) so only one of those gets locked up along with one of the “emergency” goals but never the other — that way you can cash out one “funding for emergency” goal if you suddenly need $300 of it without it ever being locked up since you alternate funding those as well.

I guess you could set up two funding accounts (or even four for larger amounts) for everything so at least half of your goal is never locked up in the event you need money fast. Also you would then have the quick option to only cash out half of your goal if you need too. Though you could create a “partial cash out” goal — then instead of cashing out all (or half of) your money from a savings goal, you would place the portion you want to cash out into the “partial” goal — let’s say $35 and cash that out, keeping the savings goal intact till you can complete that goal; though according to Holly’s post above, it appears you now can take out portions without completely cashing out — so this would no longer be necessary.

I probably won’t get this account (at least not for a while) since I already have an MMA that’s at 1.75%, but if the APY rate to that account ever goes drastically down then I’ll consider switching.

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avatar 19 Anonymous

I’m about a month into my membership with SmartyPig and I really like it. Altho rate has dropped from months ago, it’s way better than my credit union for simple savings. I also like that I can transfer between goals. I plan to have one big monthly transfer each month into one main goal and then fund my other goals from that main one — that way I don’t have so many different transfers out of my bank and I can distribute the dollars myself on the SmartyPig side. This is also a work-around if you only want to close part of a goal (which I think is still the rule despite some other comments here).

You do have to transfer the minimum $25 to set up a goal but you DON’T have to have recurring contributions to each one. I’ve also
a chance to redeem a goal into an card — worked slick, and I received the electronic gift code within about 10 minutes (they advertise 2-4 days). The bonus cash wasn’t huge (3%), but felt like free money since my purchase was tax-free and delivered free.

Regarding the beneficiary or POD stuff — I was concerned until it dawned on me that as long as my heirs can login to my SmartyPig they can transfer the money back to my bank which DOES have the POD. I just need to leave those instructions with my other important papers.

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avatar 20 Anonymous

Stay AWAY from Smartypig! These guys are serious bad news. I tried to close an account with them and they made me wait 9 business days!! I had over $41,000 with them in deposits and I tried to close the account – but they held it up because they needed 9 (that’s NINE) business days to verify whether a recurring (get this) $10/month fund deposit would in fact clear. When I explained that they were holding $41,000 that I needed access to within 5 days hostage for $10 (which they could simply credit back or hang on to for all I care), they SO could not care. stay away from this bunch – quite rude and inflexible.

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avatar 21 Anonymous

Beware of the fact that if something happens to you – your family will have to spend some cash on lawyers to go through probate court only to get pennies on the dollar – DO YOU RESEARCH

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avatar 22 Anonymous

This site needs an UPDATE author. It says it was updated in Oct of 2012 but most of the info is old news…including the comments above.

One of the big gripes on here is that there’s no beneficiary. There is indeed a beneficiary feature. Once you have an account, go to: My Profile, then Payable on Death, then fill out your beneficiary. It’s been there for a while.

APY is 1.00%. On any amount (Yes, above $50,000 too). Period.

Also, a couple people mentioned it but I’ll reiterate: you do not have to have an automatic EFT every month. You put in the initial amount and can choose None for Scheduled Contributions. Then you just transfer whatever amount…whenever you want.

Another big feature that I don’t think anyone mentioned. Yes it’s true that when you close a Goal out, you have to close the entire amount out. However, if you set more than one goal up, you can transfer funds between goals and then close out the amount you want. For example, say you have $10,000 in one account and just the initial deposit, $25 bucks, in another. Your car breaks down and you need money. Transfer everything but the amount that you want to withdrawal to the small account, for ex: you need $1000, so you transfer $9000 to the small account. Then close the $1000 account and you still have your $9025 in your other goal. It’s that simple.

Also, check out the Cash Rewards Debit Card. It is accepted anywhere Mastercard is accepted. It’s prepaid, you fund it through your Goals (immediate funding) or from one of your linked bank accounts (up to 8 business days). You earn 1% cash back on every purchase, which of course is deposited back into one of your goals. So it’s like a rewards credit card that you fund with your own money…except no interest rate…no lines of credit…and no running your credit for approval. Yes, there are provisions (ie, 1 transfer per goal per month) – just make sure you’re aware of what they are and you’ll realize it’s a great alternative to constantly running your credit cards up.

11% free cash for a Macy’s christmas gift card? Why yes…thank you. 3% for Amazon? Absolutely. Time to travel? Book w/ Travelocity and get 10% cash incentive from Smarty Pig. So many options for withdrawing your funds. There’s over 30 cash incentive gift card options, the Cash Rewards Debit card, back to your funding bank account…or a combination of all 3. Options. Name another bank that offers that?

And for the couple people that had trouble closing account above? I’ve never had trouble closing accounts. Bought a house a year ago and transferred the $27K for the DP and closing costs…no hassle. It was in my funding bank account in under 3 business days. And my $27K…was now almost $30K, from FREE MONEY Smarty Pig put in there over the years. I needed new furniture anyway…thanks Smarty. :)

So author – get some updates on here and haters – go elsewhere. Smartypig is really where it’s at!

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avatar 23 Anonymous

Stay AWAY from SmartyPig. Spectacularly unhelpful and flat out RUDE customer service. They have locked down my funds and refuse to release them to be before a “mandatory 5 day waiting period”. Half the time when you call customer service they route you to Voice Mail for God’s sake. Then when you FINALLY get them on the line no one can do anything. Refused to let me speak to a manager, refused to lift a finger or even express basic empathy. I will NEVER use their product again.

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avatar 24 Anonymous

I totally agree with “Dan from MD” above. Smarty is a great savings tool and also a money maker tool! I’ve been using it for a couple years now. No bank savings account can come close to match the return. I bought a new motorcycle for $21k…used the dealer’s “0 interest for a year” promotion. I took the money that I would have paid for the bike and socked it into a Smarty goal for a year. It gained about $200 interest…$200 I wouldn’t have had otherwise. It’s a great tool. I currently have most of my savings into different Smarty goals, making money for me!

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avatar 25 Anonymous

My family and I have used SmartyPig from time to time…. One, for Holiday Savings, another, vacations… We even used it to save for money to put toward adopting a baby. I think the idea is a very good one, in that, you are able to do a few specific thing: one, if your married/partnered etc….. and one of you spends and the other saves, keeping only one of you in control is best – this is our situation. I save, and WILL NOT TEMPT, my partner, would do anything to withdraw early if needed. Two, if you have a small income family and can only afford to save small bits (BUT< EITHER WAY< THEY DO ADD UP!) This company is also the way to go. So, I frequently use them.
However, if you are still like our family, and want to save, here is a little trick that we use:
1. Go to the cheapest place you can find and buy a "piggy bank" that is designed to resemble a Crayola Crayon.
2. Super-glue it closed they can be opened.
3. empty your pockets at the end of each day with whatever change you have….
we saved $893.00 in less than 6 months.
*no interest tho….

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avatar 26 kara

I just signed up for smarty pig and wanted to save $1000 for a trip i’m taking next january 5th. since there are 10 months between now and then (deposits made the 1st of each month), that means $100 per month. their on line calculator told me that i needed to deposit $111 each month to make that amount by my target date. I called and the customer support woman said that sometimes the calculator is not correct. i didn’t think that was a good answer, so i asked for a supervisor. she said that sometimes the interest rates change so the estimate changes. i replied that IF the interest is considered, then my deposit amount should be LESS, not MORE than 100/month. She agreed and still couldn’t understand why the calculator would be so off but she said that i could just put in the amount that i want and not use the calculator. I replied that if this bank cannot calculate 1000 divided by 10 correctly, I don’t feel comfortable using it. She said she would try to talk to the coders about why its not working.
I canceled my account.

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