November 24, 2008
FOR IMMEDIATE RELEASE
Media Contact:
Martha Shaughnessy
Atomic PR for SmartyPig
415.402.0230
martha@atomicpr.com
SMARTYPIG HELPS USERS STAVE OFF DEBT WHILE GRANTING HOLIDAY WISHES
12% of SmartyPig users set goals specifically for holiday shopping - average amount is $903; APY and retail partnerships help stretch dollars, adding nearly $2 on every $10
DES MOINES, Iowa, November 25, 2008 - SmartyPig® http://www.SmartyPig.com, the online piggy bank that helps individuals, families and organizations save for specific goals, today released aggregate data from its American user-base, indicating financial trends as we head into the holiday season - including top savings goals for users, and average dollar amounts saved. SmartyPig, a new service that leverages the age-old idea of saving up for purchases, adds Web 2.0 and social networking technology to help customers reverse the “buy now, pay later” credit-card mindset - and has seen 506% growth in its deposit base since the economic downturn
“We know people need to change their ways when it comes to spending, and we’re helping them do it,” said Jon Gaskell, SmartyPig cofounder. “According to Paul Kasriel, director of economic research at Northern Trust in Chicago, last year Americans spent approximately $472 billion more than they earned after taxes - a negative savings rate of 5.2 percent - double the previous year, and a record high. We are working to help people reverse the credit card mentality that got us here, and are also optimized to reach the next generation of savers, so they can learn from current mistakes and avoid ending up back in this predicament.”
SmartyPig offers the only true banking application that is social, appealing to the next generation of banking customers while making it easier and more fun than ever to save up for specific goals. SmartyPig also lets users embed customized widgets on popular sites like Facebook, MySpace, or on their own blogs and Web sites, to share goals with friends and family.
Currently, the SmartyPig average goal amount is $8,558, with the projected duration scheduled at just over 4 years. The goal category breakdown is below, along with the average goal amount in each category:
- Travel 21% - Average Goal: $4,411
- Holiday Spending money 12% - Average Goal: $903
- Electronics 10% - Average Goal: $2,470
- Home Improvement 6% - Average Goal: $12,912
- Saving to Save: 5% - Average Goal: $9,761
- Weddings 5% - Average Goal: $7,850
- House down payment/addition 4% - Average Goal: $22,228
- Emergency Fund 3% - Average Goal: $6,632
- Babies 3% - Average Goal: $5,084
- Home Furnishings 2% - Average Goal: $3,543
- Car or Car Expenses 2% - Average Goal: $6,778
- College: 1% - Average Goal: $9,667
- Misc. 26% - Average Goal: $10,710
SmartyPig offers a highly competitive 3.90% (APY)* interest rate on its FDIC-insured savings goals, and once a savings goal is reached, customers have an option to receive cash boosts of up to 6% from best-in-class retail partners like Amazon, Royal Caribbean, Pottery Barn, Best Buy, Home Depot and Overstock.com. Combined, the redemption can save a user $200 on $1,000. If one saves $100/month for 12 months with SmartyPig’s 3.9% APY and redeems a gift card with a 6% cash boost, the out-of-pocket cost is $1,200, for $1,290 purchasing power. Conversely, if a shopper charges $1,200 to a credit card this season and then pays $100/month for the following year (at 14.99% APR), they’re left owing $107 at the next holiday season. The actual out-of-pocket cost is over $1,300 for $1,200 purchasing power.
A full 67% of SmartyPig users are under the age of 35, 20% are between 36-45, and the remaining 13% are older. However, United States law doesn’t allow minors to be primary owners of a bank account, so children’s goals are owned by their parents. Anecdotally, SmartyPig knows many children and teens are saving with them. Money saved can be redeemed in one of three ways. Once consumers reach their goals they can:
- Receive savings plus interest on the flexible SmartyPig MasterCard Debit Card (which can be used anywhere MasterCard is accepted, including ATMs – for withdrawals only)
- Have savings plus interest returned to the bank account they use to fund their SmartyPig goals via Electronic Funds Transfer (ACH)
- Stretch savings dollars even further, receiving savings plus interest on a gift card from some of the country’s top retailers
SmartyPig was created after co-founder Michael Ferrari, who had just set up a 529 college savings account for his new son, searched for a similar way to automatically save for a vacation that offered him the benefits he felt were most important: a social networking aspect, true incentives from retailers he frequents and ease of use. When he couldn’t find anything, he set out to create SmartyPig. The company has seen rapid adoption in the U.S. since its April 2008 launch.
About SmartyPig
Headquartered in Des Moines, Iowa, SmartyPig is a simple, smart and secure way to save for a specific goal. Using groundbreaking technology and the latest in security standards, SmartyPig helps users reach their savings goals faster by allowing them to invite family and friends to contribute to their accounts, gives additional incentive boosts from top retailers who sell exactly what users are saving for and offers a competitive interest rate. SmartyPig.com is a privately-owned company which launched in April 2008. For more information visit www.SmartyPig.com. The SmartyPig site is protected by copyright and trademark laws under U.S. and international law. U.S. and international patent pending. All rights reserved. U.S. Certificate of Registration #TXU001582439.
*Annual Percentage Yield (APY) is accurate as of October 10, 2008. Rates may change at any time without prior notice. All U.S. funds are held in West Bank, member FDIC.
Visit:
SmartyPig website: http://www.SmartyPig.com
SmartyPig blog: http://blog.SmartyPig.com
801 Grand Avenue, Suite 290
Des Moines, IA 50309
Phone : 515-256-2086
Fax : 515-256-2091
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