Saving Money for Non-Budgeters

SavedPlus

Everyone wants to save money, but some people don’t have the discipline to “pay themselves first”. If you don’t balance your checkbook or put away a set amount of money with each paycheck, then SavedPlus might be a simple solution to help you save money without having to change your habits.

The way it works is simple. You choose a savings percentage between 5-20% that you want to save with every purchase you make. Then as you spend, that extra percentage gets moved from your checking to savings account. So, if you set your percentage to 10% and go to the grocery store and spend $75, an extra $7.50 will be moved to your savings account. You can change the percentage from the mobile app or web site whenever you’d like as well as check your account balances and set up goals.

To keep you from pulling too much from your checking, you can also set up a maximum transaction amount so that it doesn’t save an extra 5% of that new flat screen purchase as an example. In addition, you can choose to exclude single transactions if you want. To keep you from overdrawing your account, you can also set up a minimum balance for your checking account so that it stops transferring money if your balance gets too low.

In order to use this service, you give your checking and savings account information along with your debit and credit card info so it can catch all of your transactions and move the money from your checking to savings. How much does it cost to use this service? Nothing. It’s free. You don’t have to open any accounts with them since they use the accounts you already have.

For those of you who balance your checking account and keep close tabs on what you spend, this may not be for you. It would drive me crazy to try to keep track of the extra transactions. But for those who keep track of what is in their checking account by just looking at the balance occasionally, then this may be a perfect way to starting putting away some extra money for a rainy day or retirement.

For more information, you can check out their site, the FAQs, and the How It Works page.

Potential Savings: I haven’t personally used this service, but it seems to be getting some attention. According to their website, average users save $350 a month or $4200 a year. That’s quite a bit of coin for not having to change your habits.

Do you need an Ally?

Ally Bank Logo

We’ve been using an online bank for the majority of our banking for several years. We started with ING Direct until they were purchased by Capital One. We don’t really care for the large banks and figured they’d screw up a good thing, so we decided to switch to Ally Bank. We’ve been with them for a few years now and have no real complaints. Below are some of the reasons that we use Ally and online banks in general.

  • ATM Fee Refunds – With ING Direct, we had to use certain ATMs to not be charged a fee. With Ally, we can use whatever ATM we want, and they will issue us a refund for the fees we pay at the end of the month.
  • Paper Checks – We didn’t have a need for them that often, but they are handy to use occasionally. At the time ING Direct didn’t offer paper checks, but Ally did. Whenever you need more, you just let them know and they’ll send them to you at no charge.
  • Interest Rates – Face it, no one is paying great interest rates, but Ally is usually at or near the top. I’m not the type of person to go around and switch all my banking because someone else offers a .01% better rate. As long as we’re near the top, I’m okay with that.
  • Multiple Checking Accounts – At the time, we could only open one checking account with ING, but we wanted multiple. We like to put money from each paycheck into a “bills” account so that it can be pulled out automatically each month when it’s needed. In order to not go over the 6 withdrawal limit of a savings account, you have to use  a checking account. Plus, we got a debit card for the account and could use that with a lot of the places we pay each month. We also decided later to set up an account for myself and my wife. We keep our finances together for just about everything, but we also have our own little account that we use for our own personal spending. It’s our “no judgement” zone.
  • Tons of Savings Accounts – As far as I know, you can create as many as you want. You can create them for any savings goal you might have and then set up transfers so when you get paid, money is automatically transferred to your savings.
  • Instant Transfers – Did an emergency pop up that you need to take care of and need the money transferred fast? You can do it instantly from one account to another, even on the weekend.
  • Overdraft Protection Using Your Savings Account – You would never do this of course because you keep really good track of your checkbook. Let’s just say you were out and your car breaks down. You can’t transfer money from your savings to checking right then. If you tie a savings account to your checking account. When you pay the bill, Ally will transfer the necessary funds from the savings account to your checking account to cover the transfer. This saved us once when my wife lost her debit card for our shared account, and needed to purchase something. She simply used the one for her personal account and we took care of cleaning things up later.
  • Online Chat – If you’ve ever got a question, you can load up chat on Ally’s site and they can help you right away.
  • Online Bill Pay – Who doesn’t offer this? The nice thing about Ally’s is that they don’t take the money out of your account until the day the check is supposed to be delivered. That means you get a little extra time to earn some interest.

I will admit, they were little late to the mobile game. When their original mobile app came out, it wasn’t that impressive. It has improved over time and now allows for eDeposits where you can take a picture of a check and it deposits it into your account. This keeps us from having to run to a brick and mortar bank, deposit the check, and then transfer it up to the account we want it in.

I know there are some other online banks that have created fancy sites that show you a bunch of graphs and do automatic savings of one sort or another. Honestly though, I like to keep things simple and know exactly where our money is and where it’s headed. Ally has worked well for us and if you’re looking to dip your toes in the water of an online bank, give it a try. It might be a great place to put that emergency fund you’ve been working on.

(For what it’s worth, we have one account at a brick and mortar bank. We keep $5 in the account to keep it open. The only reason we have it is for those times we want to deposit cash or a check made out to one of our daughters. Once we make our deposit, we transfer the money almost immediately to Ally.)

Target REDcard debit card

Target Logo

Do you shop at Target? Do you have a Target REDcard yet? More specifically, do you have a Target REDcard debit card? Assuming you shop at Target and you haven’t signed up for one, what are you waiting for?

When we were first asked by the cashier if we had a Target REDcard we of course said “no”. We don’t have credit cards and we don’t sign up for them in order to get a deal. That’s when she told us that they had a debit card. Of course, the question that came to mind was, “what’s the catch?” Since I couldn’t see any at first glance, we decided to sign up for one and start saving right away. We’ve had our Target REDcard debit card for probably 3-4 years now and the benefits have continued to get better.

Benefits

5% off your purchases

This benefit is the one that appealed to me the most – 5% savings on purchases at Target stores and Target.com. You might wonder how they’re able to offer 5% off your purchases and not charge any fees. This is what I’ve come up with. With a normal debit or credit card, when you make a purchase, the store is charged a fee to process your purchase through your card. It’s a cost of doing business that most stores absorb to win your business. With the Target REDcard debit card, Target is able to do the processing and take the money out of your checking account using a bank transfer. This keeps them from having to pay the fees to the banks or credit card processors. They can then pass the savings on to you. The normal processing fees probably don’t amount to 5%, but I’m sure they’re willing to take a little bit of an extra hit to give everyone the 5% rebate.

Free Shipping from Target.com

They didn’t originally offer this when we signed up for our card, but I’m not going to complain. I took advantage of it recently when buying an anniversary gift for my wife that they didn’t have in the store.

Extra 30 Days for Returns

If you use your REDcard, you get an extra 30 days to return your purchases. Not that you’ll need it though, but it is a benefit.

Take Charge of Education (1% to the school of your choice)

You can enroll your REDcard with Take Charge of Education and choose the school you’d like donations to be sent to. One percent of your purchases is sent to the school of your choice. You can even log in and see how much has been sent to your chosen school because of your purchases and the purchases of others who support the same school.

NO DEBT!!!

They don’t list this as a benefit, but really it is. What good is saving 5% if you’re going to pay interest on your purchases because you went into debt for them?

Drawback

Spending More

One drawback that I can see (and they probably hope for) is that you might spend more than you normally would because you know you’re saving money. A little self control can fix this problem. As long as you use it to purchase the items you would have bought anyway at Target (for us, that was diapers and wipes), you will save money. Otherwise, stay away if you have a shopping problem that you can’t control.

An Extra Card to Carry

That extra weight in your purse or wallet could cause some serious health problem. Not to mention the anxiety that is caused by making a purchase at Target and then realizing you forgot to use the REDcard. Then you’ve got to consider the chiropractor and counseling charges. This thing could end up costing you a ton more than you’re saving. (Can you tell that I’m having a hard time coming up with drawbacks?)

Potential Savings: I guess this depends on how much you spend at Target, but essentially 5% of your total purchases and free shipping if you use Target.com. If you have the willpower, take the savings (which prints out on your receipt) and put it in a savings account, towards your debt, or in a 529 for your kids. You would have spent it anyhow, so you might as well redirect it before it gets absorbed somewhere else.

Update 11/24: 5% Off Gift Cards

I’ve recently discovered that you can get 5% off of gift cards that you purchase through Target. They don’t have everything available, but they do have quite a variety. We’ll be saving $140 off of our Disney vacation by purchasing Disney gift cards through Target.com and using them to pay for the trip. That’s some serious savings!