Remember back in the day when most of us actually carried cash? When you got home at the end of the day, you’d empty the change from your pockets or your wallet and throw it in a jar, and after some time, you’d roll the coins and stop by the bank and cash them in?

Alternatively, if you paid for something with a check or debit card (and actually wrote it in your checkbook register), you could “round up” to the next dollar, making the math easier, so the balance in your register showed a lesser balance  than actual balance in your account (due to the roundup), and voila! Another easy way to “save” money… although I equate this to setting your clock ahead by 20 minutes to “trick” yourself into thinking it’s later than it is, so that when your alarm goes off and you get up, you have 20 extra minutes to get ready. That doesn’t work for me… all it does is make me better at doing the math to figure out the actual time while half asleep.

Well, I’m gonna tell you about today’s version of the same concept… Digit, an awesome money saving app. Thanks to my buddy J-Money at Budgets Are Sexy for the tip on the service!

I could go into a lot of detail about Digit, but the gist of it is, when you sign up for the service, it simply connects to your checking account, where it monitors your average spending habits – then it uses a fancy algorithm to calculate small amounts you won’t really miss, and transfers small amounts of money automatically into your own FDIC insured Digit account, where it’s saved until you choose to withdraw it. Bing bang boom!

If it sees that a particular time of the month is a time when you normally have several bills due, or don’t have as much money coming in, it will adjust the amount it transfers accordingly. Sometimes it may save a few bucks, others, it might be twenty bucks. Long story short is, they take only what they think you can afford and won’t miss too much. In fact, they’re so confident about the technology, they’ll reimburse you for any overdraft charges incurred by their service.

And the best thing? If you choose to withdraw some or even all of your savings from Digit, there are no penalties or fees, or limits to the number of transactions you can make. There are also no minimum balances to maintain.

The drawback is that you do not earn interest on the saved amounts – any interest earned goes to Digit to help maintain this service, but they are working on a way to incorporate some sort of interest-based plan sometime in the future.

Just think about it this way… if you weren’t using Digit, would you really put these small amounts each day into your own savings account? Probably not. You’d spend that extra $15 on a chicken burrito and a beer.

Digit is simply an easy way to save money, and I’m really curious to see how much I can save using the service.

Initially it can take a few days before you see a transfer because the program is designed to calculate what you won’t need, so it will need time at first to get a bead on your spending habits, but after that, it’s a “set it and forget it” type of service, although all you have to do it text “Savings” to find out your balance at any given time. I just love that I don’t have to think about it, and any amount it saves is an amount I wouldn’t have otherwise.

(don’t worry, it’s free!)*

Are any of you already using Digit to save money? If so, comment and let me what you think and how much you’ve saved so far!