News

14Jan
2016

3 Options for Stashing Your Cash Automatically

Want to grow healthy savings? Establishing a habit is often the hardest part of this intention, but today’s technology gives savers a few smart options that make saving easier than ever.

Acorns
Invest your spare change with the help of Acorns. This app links to your credit or debit card and rounds up the cost of everyday purchases to the nearest dollar. The difference is then removed from your checking account and invested into a recommended stock portfolio. (Nobel Prize-winning economist Dr. Harry Markowitz, the father of modern portfolio theory, helped develop Acorns’ method of making portfolio recommendations.)

There are no commission fees for trades made by Acorns, but there is a $1 monthly fee on accounts under $5,000, as well as a 0.25 percent fee each year for accounts over $5,000.

Digit
Having trouble developing the habit of saving? This startup, which launched in February 2015, links to your checking account and evaluates your income and spending habits to predict your cash flow. Every few days, the app decides based on your lifestyle how much it can safely transfer from your checking account to your Digit account (typically between $5 and $50). You can make withdrawals from your Digit account at any time with just a text.

This free app features FDIC-insured accounts (up to $250,000) with unlimited transfers and no minimum balance requirements. The downside? Your Digit account doesn’t bear interest.

Your Bank or Credit Union
If the idea of trusting your finances to an app or not bearing interest on your savings leaves you wary, you’ve always got more conventional options. One of the most popular is the practice of setting up recurring bank transfers, where pay is direct deposited into a checking account and a portion of each check is then funneled into savings. Your bank may also feature an app option for savings, helping you ease into the world of financial technology.