A small business that mixes savings with social media has in four years helped users save almost $3 billion to reach savings goals. It is an idea that was conceived during the heart of the recession when savings were all the concern as credit faded away. SmartyPig uses saving for an education fund and expands on it to include other savings goals, and has grown to become a valuable tool used both in the States and in Canada.
SmartyPig creates an online savings account specifically catered to a savings goal such as planning a vacation or planning to buy a house. Once it is established, money is able to be transferred in from your regular bank account and links can be built from Facebook, Twitter, and other social media so friends can see what goal you’re shooting for and offer to help. On top of that once the goal is reached and you are ready to make your purchase, certain merchandisers will offer discounts if they recognize SmartyPig and your account as a goal worth supporting.
What users of SmartyPig like about the venture is that it is different from a regular bank savings account. It’s something you do still need to incorporate into your budget because it becomes a deductible for each month; however, you don’t see that amount all the time. You can check on the total and make updates on Facebook or Twitter to help build interest but since it is separate from your bank, it doesn’t carry the same temptation to pull some money out when cash is a little tight.
The owners of SmartyPig are now looking to sell their idea to banks in both the U.S. and Canada to help offer them an opportunity for expansion into social media. The premise is that banks are very behind on social media platforms and in connecting with their customers in general. Encouraging savings for home or other asset purchases is very supportive and helpful but if you can’t connect that logic to people with a human touch, no one will take the advice and plan ahead. SmartyPig believes that their business will help expand the banks’ abilities to gather information about their customers and steer them in a positive direction financially.