Digit Review: The App That Saves You Money (2022)
In this Digit review, we’ll look at how this mobile app can help you save more money every day. The Digit app helps to provide you with an overall view of your finances in one convenient place.
Between bills, rent, and groceries, there isn’t always much left for saving and investing. On top of your monthly expenses, you might be juggling credit card debt and student loans.
When you’re struggling just to pay your monthly bills, it’s hard to envision being able to set up a rainy day fund, much less save for retirement.
That’s where Digit can help you.
Contents
How does Digit work?
Digit succeeds where many of us have failed – by helping you with the savings process. This automatic savings app helps you to:
- Study your spending habits and recent spending behavior
- Identify small amounts of money that you can establish a sustainable savings habit
- Set up automatic transfers to a Digit savings account
In other words, Digit’s savings algorithm is a great tool to help you take control of your personal finances.
All you have to do is activate the app. If Digit saves you even $200 a month, that’s $2400 a year. It’s hard enough to make money, let alone save it.
Sometimes you just need a push to get started. Digit provides that push.
What is Digit?
Digit is a micro-savings app that helps users save money they likely would have spent somewhere else. There are other apps that help you save, but Digit was the first automated financial saving application of its kind.
Digit was created in 2013 by Ethan Bloch who has a single goal in mind – to automate saving money. As of 2022, Digit charges a monthly fee of $5.00. However, you can sign up for a six month free trial.
How to start using Digit
Using Digit is easy. The first step is to register through the app with some basic personal information.
From there, connect your bank accounts and set minimum saving goals. The app communicates via text messaging which sets it apart from other savings apps.
Algorithm-based savings
Digit uses a complex algorithm to track and analyze your spending habits. After a few days, Digit’s algorithm will have assessed your spending patterns and identifies extra money that can be converted into savings. When you’re starting off, even finding spare change to begin investing is a good beginning.
Digit sets up automatic transfers of money from your bank account to a Digit savings account. Digit strives to find the right amounts of money to transfer each day that it doesn’t impact your finances for upcoming bills.
For example, if you have $500 in your account and a bill comes up for $400, Digit won’t save more than $1 at that time.
But if you have that amount and no upcoming expenses, Digit is likely to move around $10 to the Digit account.
Digit automation
The Digit app, available for either iOS or Android devices, allows you to set up spending, saving, and budgeting goals. Once Digit understands how much money you need to pay upcoming bills, it automatically transfers money to where you need it most.
Paying bills
Once Digit’s algorithm has taken a closer look at your spending, it will automatically keep track of your upcoming bills and ensure that your checking account stays above the minimum balance to pay those bills.
Safe to spend
You can check with the Digit app at any time to see check your balance. Digit will automatically tell you what is a safe amount to spend without impacting your upcoming bills or savings goals.
Investing for the future
Digit’s Invest function enables you to not only save for near-term goal, but to set aside money for long term investments. You can choose from a variety of low-cost exchange traded funds (ETFs) that are designed for your particular risk tolerance.
Additionally, you can put money into tax-advantaged individual retirement accounts (IRAs). You can choose between traditional IRAs and Roth IRAs. However, before getting too far into investments, you might want to talk with your tax professional.
Additional Features
Here are some additional features that we like about Digit.
Text Commands
Digit allows users to handle their savings with text messages. Simple one-word text messages like, ‘Withdraw’ and ‘Balance’ help you manage your savings.
No limits on the goals you can set
You can set up multiple savings goals, which can be short-term goals or saving for retirement. You can put the money into high yield savings accounts for short term growth, or invest for the long-term.
No minimum investment
Digit doesn’t dictate any minimum limits on user account balances or investments. You can start by investing or saving spare change and move up from there.
Low Fees
At $5.00 per month, Digit is a relatively cheaper service as compared to other financial institutions and apps. New users can get the first six months free depending on the promotions available at the time.
Multiple Access Points
Digit offers convenience, allowing users to access the app on iOS, as well as Android devices, and is compatible with Smart and Apple watches. With no internet connection required, users can conveniently manage the app’s activities via automated text message.
FDIC Insured
Users needn’t worry about the security of their funds. Digit’s savings account, known as Direct,℠ is a deposit account powered by MetaBank®, N.A., Member FDIC. This FDIC protection is for account balances up to $250,000.
Signing up with Digit
Signing up for Digit is simple:
- Go to Digit’s website or install the Digit app from your Android or iOS app store;
- Clicking the blue sign-up button prompts you to enter your personal details, email, and password;
- You will then be asked to connect your bank accounts;
- Then select the service where you wish to communicate with Digit (Default is SMS);
- Set-up a minimum saving value ($200 by default);
- Start saving!
Who is Digit for?
Digit is for those who wish to save up but have been unable to do so.
People are caught up juggling their jobs and social lives. Saving money is just an added worry that they struggle with.
However, saving is probably the most important thing in the long-run.
With small daily savings, Digit helps you save a significant amount by the end of the month or year.
The best part? It’s all automatic!
Is Digit legit and safe?
After a quick Google search, you’ll find that the majority of users are satisfied with Digit.
Venture capital-funded start-ups like Digit are generally expected to show results and satisfied customers. Especially if it’s backed by Google’s own venture capital firm.
This speaks for itself, along with millions of customers. To date, Digit has saved over $1 billion for its customers.
A lot of people have left positive reviews on its Play Store app, along with suggestions to improve its features. Digit entertains all such suggestions and promptly replies to the reviewers.
No app is perfect and Digit is no exception to bad reviews.
For apps like Digit, certain Terms and Conditions are set in place to ensure best practices. These are mostly addressed in the FAQ sections of these apps.
Users often overlook these resources and go right for the app. The bad reviews are most often the result of users ignoring the FAQs and Terms and Conditions.
Digit might need to make sure that every new customer reads up on the app and its practices so that they know what they’re getting into.
Pros
- Easy Access: Digit offers a very convenient way to interact via text. It even recognizes one-word commands.
- Digit Savings Bonus: Digit rewards its customers. Among others, one reward offers a quarterly 1% annualized savings bonus to all customers who are saving with Digit.
- Same-Day Transactions: Digit provides the option of same-day transfers to customers who have a Chase or Wells Fargo bank account.
- Customer Support: Digit boasts an incredibly responsive customer support team. They seek to resolve all issues within a 3-day period to avoid any financial hiccups.
- Automation: Digit’s fully automatic savings give it a competitive edge over other similar apps. Once the parameters have been set, Digit saves a certain amount every day, without causing any hindrance to your daily transactions.
- Safety: Digit is safe. It encrypts your data with 256-bit encryption, at par with security levels used by the military and in the banking industry.
Cons
- Limited Access: Currently, Digit is only a US-based service and doesn’t cater to non-US customers.
- Limited Website: If you’re computer savvy, you may have an issue with Digit as there is only so much you can do on their website or through the Digit app. Texting is the most convenient and preferred way of engaging with Digit.
- Low-Interest Payments: A large part of Digit’s financial model depends on earning money through the interest collected on your savings. You only get a small chunk of your actual interest payment.
- Not For The Long Term: While Digit saves for you in the short-run, savvy investors might find their ETF selection to be limited.
- Algorithm Mystery: Digit doesn’t explain how their saving algorithm works. The company has not yet released its design parameters so no one really knows how Digit’s saving algorithm works.
Digit Review Wrap Up
Probably. It’s so much easier to live in the moment, instead of coming up with long-term financial strategies or saving for your long term goals.
And let’s face it: most of us are pretty oblivious when it comes to savings. Digit helps solve that issue.
Once the Digit app is set up, it sets aside a small amount every day, while ensuring enough is left over cover recurring expenses. After a few months or a year, you might have a good amount of money saved that you didn’t even know you could save.
Savings are essential, as you never know when you might need that extra cash and Digit helps you get those saving.
So if you’re okay with the monthly fee, register on Digit and give it a try for a few months. Who knows, it might be just what you needed.
If you have already used Digit, share your experience in the comments!