digit Archives - Lazy Man and Money

Dobot: Automated Saving for Goals

November 21, 2017 by Lazy Man 16 Comments

Every year, I get thousands of marketing pitches in my inbox. I often find that there are fewer than 10 are worth my time to readers. It almost makes me want to shutdown my email completely.

Today, I’m bringing you one of those 10 pitches that makes it all seem worth it: Dobot (pronounced: “dough bot”, get it?)

What is Dobot?

Dobot is a FREE financial application that squirrels away small amounts of money from your bank account into a separate saving place. The idea is that you won’t notice the money being taken out and that you won’t spend money that isn’t there. Sounds like a great unique idea…

… wait? You’ve heard this before?

Yes, that’s essentially the same description of Digit, which I’ve been recommending for the last 18 months. Just two weeks ago, I wrote about how one can use Digit in the same way to save for the holidays now.

If Dobot were an exact copycat, I wouldn’t be writing this article. We already have a 5-letter savings account squirreller that begins with “D.”

So what makes Dobot different than Digit?

Let’s review briefly what Digit is. Digit allows people to save money into one pool. It continuously saves money, a little each day. I’ve been using it for building a general emergency fund. I have had enough emergencies (new car brakes immediately come to mind) that keep it from growing too far out of control.

Dobot helps people to save with the idea of a specific goal in mind. You can have multiple goals and hence pools. You enter a goal, how much it costs, and when you’d like to reach it. Here’s a 90-second video overview:

Getting Started With Dobot in Less than 5 Minutes

Earlier today, I signed up for Dobot to get an idea of how it works in practice. It took one click from the Dobot website to get the Android app (there’s an Apple one too) installed on my phone. When I ran the application, I simply created an account by adding my my email address, my phone number, and a password. I then choose my financial institution, logged in, and picked my bank account. (Let’s put the question of security aside. We’ll get back to it in a bit.)

I’ve written before that I’ve been saving money for this very extremely expensive television.

I created a simple goal, “OLED 65”, “November 2017”, “$2500.” The most difficult part was trying to figure out what the cost of the television will be when I think it is a good value to buy. I’m not sure if the good value is $2500 as I like to find a rare bargain. I think that there might be a Black Friday deal next year with that rare bargain.

Here’s Dobot’s example of how a typical goal might look:

While I just signed up, my understanding is that each week some money is put aside towards the goal. Since my goal is about 55 weeks away, I imagine that it will save around $45 a week, which would give me around $2500 by my target date.

Dobot allows you to add a picture for motivation. Unfortunately, it wouldn’t let me bring in pictures from Pinterest or Amazon. I had to already have them on my phone. So I took a picture of my current Wal-Mart brand budget television that I want to upgrade from.

Dobot is a very visual application, which is very different than Digit which works best by text message.

In the coming days I will look to add some minor and major upgrades around the house.

I see Dobot as a great budgeting tool. Some banks allow you to create sub-accounts for the same kinds of savings goals. Unfortunately, USAA required me to create a separate savings account for my OLED TV. It wasn’t a huge pain for one thing, but I certainly wouldn’t want to manage 20 accounts via USAA’s website.

The downside of all this is that you aren’t going to earn interest. Some people may be upset with that. I see it as a non-issue given today’s extremely low interest rates. If I was getting 3-4% in my savings account, it would be a different conversation.

Is Dobot Secure?

Dobot is FDIC insured which is always something to look for. They say that they use bank-level security. That’s not overly convincing in and of itself. However, I know that these applications typically use the same bank-end banking engine like Yodlee. So many applications use this that the real risk is probably at Yodlee. I’ve been using these types of applications since 2006 and I’ve never heard of a hack. It might be more likely that your bank gets hacked.

Get (a little) Free Money

If you sign up from this link on the Dobot website, install the app, and add a bank account, they’ll fund it with $5. It isn’t a ton of money, but what did you expect in spending a few minutes to sign up for a free helpful, budgeting service?

I’m not sure that you need both. Some people don’t even need one. However, I can see why people would use each of them. I’ll continue to use both, because I love to automate my money. Over the years, I’ve learned that the more forced savings I have, the more my net worth increases.

Reminder: Use Dobot to Save for the Holidays Now!

May 5, 2017 by Lazy Man 4 Comments

Editor’s Note: This article was originally written about Digit, but they charge a monthly fee now. I suggest you use Dobot which works almost the exact same way, but without the fees. You can read my Dobot review here.

A few days ago, I was in the car with my wife picking up the kids and this song came on the radio. I turned to here and said, “I guess it’s time to wake up.” Fortunately, she got the joke right away.

October hits me in the back of the head like this song. Metaphorically, of course, because I’m still typing this article. It’s the start of the last quarter of the year. Everyone is in a rush to put up Halloween decorations, while I get advertisements from my local grocery store to plan my Thanksgiving through them. I bet some of the warehouse stores already have rolled out some of the Christmas stuff.

In other words, this song is going to happen soon. And if you celebrate another holiday that might be around the same time.

(I promise that this article won’t have reference any more song titles… or maybe not.)

Years ago, before credit cards, people turned to Christmas Clubs to save money for the gift-giving season. If you aren’t familiar with Christmas Clubs, I won’t hold it against you… they were before my time too. Here’s how Wikipedia describes them:

“The Christmas club is a savings program that was first offered by various banks in the United States during the Great Depression. The concept is that bank customers deposit a set amount of money each week into a special savings account, and receive the money back at the end of the year for Christmas shopping.”

I don’t know how much money you are you going to spend this Christmas, but the average is around $900. You could spend more or less, but can’t we agree that it’s best to put aside money now?

I’ve found that easiest way to do this is with a ~~Digit~~ Dobot account. Regular readers know that I recommend EVERYONE get a ~~Digit~~ Dobot account. I even recommend personal finance bloggers get it. One said to me, “I save money all the time and I’m great with it. I don’t need that.” He ended up following my advice and saved around $4000 for an expensive international trip. He said he didn’t even notice that the money was being saved.

What is Digit?

Digit was a FREE service (it isn’t anymore) that squirrels away money from a savings or checking account. It analyzes your account balance, spending, upcoming income, and upcoming bills to figure out how much it can safely move to the Digit account. It does a little at a time so you don’t even notice it. You can always tell it to squirrel less, but I set it at the maximum squirrel rate. (If you think I’m trying to set the record for using squirrel as a verb in a paragraph you are correct.)

Digit accounts are bank backed, safe, FDIC insured, blah, blah, blah. It’s got Google Ventures and other big names as investors.

Perhaps the worst part of Digit is that it will take you 3-5 minutes of your day to set-up. I’m being sarcastic. The worst part is that you earn minimal interest on your money. There aren’t a lot of banks paying significant interest nowadays. I’m used to ignoring interest after years and years of receiving almost none from bank accounts.

I’ve had my Digit account since March or April of 2015 and I’ve only saved this much:

I should have waited until I got that “snowman” for the first digit, right? Oh well.

Keep in mind that I’m saving the maximum amount and my finances might are different than yours. You can customize it to save what works for you. That’s why I feel it will work for everyone. No one has given me a convincing argument NOT to sign up for a Digit account other than, “I’m comfortable with my savings process.” That’s fine, but I’d challenge the person to try something new. They might just find out it was better than their existing way of doing things. I did.

I also have withdrawn money from my Digit account. My car needed new brakes, so I simply sent off a text to withdraw the money and it was back in my account in a day or two. If I hadn’t set up Digit, there’s a real chance that I would have spent it.

Forced savings is one of the most powerful forces in personal finance.

My recommendation is to ~~Digit~~ Dobot now so you’ll be prepared for the holidays.

Text Digit to Boost Your Savings

May 5, 2017 by Lazy Man 6 Comments

I’m a big fan of Lifehacker and last week one article caught my attention: Boost Your Savings Account by Adding the Money You Save on Every Deal. The article brings up a great point by Eric Nisall of DollarVersity in an article posted on The Simple Dollar about saving money:

“If you’re constantly scouring the Internet for deals or whipping out your coupon binder, you could be saving boatloads of money on everything from groceries to office supplies. But, what if you actually transferred those savings into an actual savings account?
Eric Nisall from DollarVersity once tricked himself into saving money by doing exactly that. Each time he used a coupon or earned significant savings somehow, he would move that money into a special account. Over time, this helped him build a stash of cash that practically came out of nowhere, he says.
‘So, if I went to the grocery store, or any shopping really, I took the ‘total savings’ from the bottom of the receipt and transferred it,’ says Eric. “I transferred all of my overtime payments as well. Since I only budgeted for gross spending and regular paychecks, I didn’t notice any difference in my everyday account.’”

I have two non-sequiturs* that I’ll save until the end so I can get to the real point.

This sounds like a very cool way to save money. I immediately dismissed it because I’m Lazy and I’m not going to go into my bank account and physically transfer the money. When you are on the go, it simply doesn’t make a lot of sense. I could save receipts for home and do it then, but it still is “bookkeeping” and part of my message is that you shouldn’t spend time managing your money.

It was then I realized that I had my ~~Digit~~ Dobot account. I can just text, “Save 13.72” in the SMS thread with them on my phone and move on. Dobot will transfer the money out of my checking account and put it in their (FDIC-protected) savings account.

Regular readers know that I love my ~~Digit~~ Dobot account. You can read my Dobot review here).

Dobot makes Nisall’s idea very easy and much more practical for the average person.

As I was publishing this, I decided I should read the comments on the Lifehacker article. It’s really interesting…

One person asks for an app to make this easy and the author of the article agrees it would be “amazing.”

The very next person asks if someone has heard of Digit and proceeds to explain how it squirrels away little bits of money each day. This is my main reason for using Digit. However, the person bringing up Digit and the people responding don’t bring up the texting functionality of Digit that is the amazing app that the author is looking for. It seems like it was brought up as an alternative to Nisall’s way of saving money rather than a way to easily implement it as a complimentary savings tool.

* 1. I had dinner at a Five Guys with Eric last year at FinCon. First time I had gotten a chance to really talk with him. Great guy.
2. This is the first time I’ve had to embed three layers of quotes with the “total savings” quote in the article. I have to admit that I didn’t know what to do here, so I just stuck with the single quotes.

Save Money for the Holidays with Digit

December 7, 2015 by Lazy Man 5 Comments

Back in March of this year, I heard about Digit and signed up for it. For those of you who are new to Digit, it squirrels away money from a savings or checking account. It analyzes your account balance, spending, upcoming income, and upcoming bills to figure out how much it can safely move.

Digit Saved me Over $100 in One Week and I just set it up and (mostly) forgot about it.

Here’s what the account looks like now:

That’s not a bad little emergency fund, right? My Digit account actually has even more money in it. If you sign up through this referral link you can actually earn $5 by referring other people. I’ve collected quite a few of those $5 bonuses. It almost sells itself. No one is against saving money the easy way.

The other day it occurred to me that Digit could be a new kind of Christmas Club. If you aren’t familiar with Christmas Clubs, I won’t hold it against you. I think they were a little before my time. Here’s how Wikipedia describes them:

“The Christmas club is a savings program that was first offered by various banks in the United States during the Great Depression. The concept is that bank customers deposit a set amount of money each week into a special savings account, and receive the money back at the end of the year for Christmas shopping.”

I don’t know how much money you are you going to spend this Christmas, but I read the average is around $880. I’m sure everyone’s Digit savings are going to vary over time, but mine seem to be around $200 a month. That means in about 4.5 months, I’d have enough savings to fund the average Christmas budget. What I like most about this is that you set it up once and you never need to do anything. For the most part, I don’t notice what’s in my Digit account unless I’m writing an article like this one.

So my recommendation is to sign up for Digit now so you’ll be prepared for next Christmas. You might even be able to snag some free money yourself by referring friends and family.

Saving’s No Chore, Digit and Ignore

June 22, 2015 by Lazy Man 4 Comments

A couple of months ago, I wrote about how Digit Saved me Over $100 in One Week! When I love a financial product and it works well, I make a point to provide a few updates. This way you not only get a follow-up, but those who missed it the first time get a second chance.

Last week I hit a milestone with Digit. They sent me a text message: “Making it rain savings, like a boss. You now have over $250 in your Digit account.” Along with it, they attached the image to the right.

Pretty cool, right?

Umm, What’s Digit Again?

I forgot, some of you are reading about Digit for the first time.

Digit is a way to save money automatically. You just link your checking account to Digit and it analyzes your income and spending. Then it squirrels away a little money each day or a few times a week. You don’t even notice it is going on.

We all know that you should pay yourself first, but it is really hard to do. You can set up automatic transfers, but that’s going to be a fixed amount and not very smart. Also, how many people actually save money? I have a better chance of getting my kids eat broccoli. I bet if I took a poll fewer than 10% consistently save money through automatic transfers.

The other issue with automatic transfers is that it doesn’t hide the money from me that well. I see it every time I log into my bank. When it is right in my face, it’s almost like it isn’t squirreled away at all. It’s too easy to say, “Hey I’m a little low in my checking account this money, let’s move a chunk in there.” And then I can keep spending. That’s no good.

At this pace, Digit will set aside nearly $1500 this year. That’s particularly notable because most Americans can’t afford a $1,000 emergency expense. In less than 5 minutes you can set yourself to be in a better position than most Americans within a year.

I don’t want to oversell it, but this website is “Lazy Man and Money.” It isn’t “Spend Lots of Time Managing Your Money.” Saving money doesn’t get any easier than using Digit.

P.S.

Dear Digit: I’ve trademarked the phrase in the title. If you want to work out a licensing agreement let me know ;-).

P.P.S.

Your savings are FDIC insured and the investors are former executives from very popular companies. I don’t think have to worry that your money is going to disappear overnight.