If you are a fan of Dave Ramsey then getting out of debt step one is to build an emergency fund.
For years I knew it was important to have one, and so did my wife, but until we started using Digit we never really had one.
Why Do You Need An Emergency Fund
Get started with an emergency fund today, sign up for Digit.
Emergency funds are important for a number of reasons. First, it keeps you out of debt.
Without an emergency fund, when something comes up, and something will come up, you will likely go into debt to deal with it.
Second, it allows you a sense of relief you can’t find otherwise. When an unexpected bill comes up and you have the money to pay for it, you’re annoyed but the anxiety attack that comes with not having money isn’t there.
Third, with an emergency fund, you can take more risks. Want to go off on your own instead of work a 9 to 5? How about taking a vacation at the last minute? Or, maybe just take a few days to relax instead of working.
If you have an emergency fund all of these things can be done.
What Is Digit?
They are a bank (they save all your money for you), as well as a computer program that automatically saves you money.
How Does It Work?
They connect to your bank account and keep track of your spending. When they feel you have enough money to save some they transfer it from your checking into the savings account they run for you.
Now, this doesn’t take a lot of money, I think the most it has ever taken from me was $12. Usually, it takes less than a dollar a few times a week.
What I have found interesting is that when my bank account has a lot of money Digit doesn’t take more money. The algorithm knows that the money in the checking is for rent and so leaves it alone.
Many people are concerned that Digit will take money when they need it. Digit guarantees that if you ever have an overdraft because of one of their withdrawals they will pay the overdraft fee.
Ready to sign up? Click here
How Do They Make Money?
But if they do all of this for you how do they make money? A good question and there are 2 main ways they make money.
First, they charge $2.99 a month for this service which doesn’t sound like a lot. However, the vast majority of people only save around $10 a month. That’s still $7 in your pocket and if you really won’t save money then it’s better than nothing.
I however usually save around $50 a month and find the $2.99 to be fair since we wouldn’t save that $50 without it.
Second, they invest the savings. Your savings may be $50 or $500 but if all their users have the same amount they can invest all of it and make some money while they wait for you to need it back.
Who Should Use Digit?
I think everyone should use digit (sign up here), at the very least you should do the free trial to see how much money you save.
Even if you’re worried about the cost as long as it saves you money you wouldn’t have saved otherwise it’s a great deal.
To sign up click here.