I found this article about an ingenious service that can help people save money. With the still struggling economy, we could all benefit from a way to help us save.
While this isn’t mortgage related, saving money is something that I think can help anybody. And, I can always suggest refinancing your current mortgage to take advantage of the incredibly low rates available right now (how’s that for a segway!). Read on…
Companies and brands are always getting better at find ways to tempt people out of their money, and sometimes the siren call of those shiny new things are just too much to resist.
Massachusetts-based ImpulseSave has been helping to combat those urges for a few months now by trying to make saving money as frictionless and as gratifying as buying something. Now that service is poised to reach a larger audience, as the company has just announced that ImpulseSave is exiting its long-running private beta.
“People have this hardwired response to gather things, and we want to use it for good,” co-founder and CEO Phil Fremont-Smith said.
Of course, that’s much easier said than done. He feels that other personal finance products and services on the market are too focused on getting their users to stick to budgets and deny themselves things they want — in essence, they’re about getting users to change their behavior. While that’s arguably a good thing in the long term, ImpulseSave doesn’t aim to fix people. Rather, ImpulseSave wants to replace one form of immediate gratification with another.
Here’s how the service works. When a user goes to create a new ImpulseSave account, they’re also creating a new savings account with ImpulseSave’s partner, Massachusetts-based Leader Bank. Once that onboarding process is done, they’re asked to create a few goals that they would like to save money towards — think paying off student loans or funding a big family trip. From there users can set up an Auto Save, which transfers a set amount of money from their checking accounts to their ImpulseSave accounts at regular intervals.
Though some people may be wary of creating a completely separate savings account, that strikes me as one of the most crucial parts of the service. ImpulseSave makes it simple to dump all of a user’s saved funds back into their checking accounts if necessary, but taking that money out of a person’s normal cash flow means that it’s just that more difficult to spend on a whim. Some people may have the self-control to abstain from dipping into their savings to fund a questionable purchase, but that extra barrier could be enough to give a person pause before splurging on something new.
Should a user be struck with the urge to buy something when they know they shouldn’t, users can either use the recently-released app or fire off an SMS to transfer more money into their ImpulseSave accounts. In exchange, they’ll get a congratulatory pat on the back for making a smart move, in addition to a breakdown of how much closer to their goal that latest transaction put them.
“We’re marketing a user’s own goals back to them,” Fremont-Smith says.
It’s his hope that the satisfaction of making the right decision will be enough to offset the potential (and often short-lived) delight of buying something new. There’s a strong social element at play as well, as users can comment on other people’s savings transactions (though sharing those transactions is completely optional).
Relatively speaking, it’s still early days for the company — Fremont-Smith came up with the concept during the middle of 2011, and linked up with his technical co-founder John Mileham not long after that. For now, ImpulseSave gets most of their revenue in the form of commissions from Leader Bank for the savings accounts they open, but Fremont Smith and his small team have been looking at opening their service up to companies and brands for new promotions as a way for them to get in front of users while remaining on their side.
Now that they’re out of beta, the ImpulseSave team is hard at work on a handful of new features to make users even more aware of their financial situation — coming down the pipeline is a geolocation feature to warn users as they enter certain stores (or “danger zones”), as well as a browser extension to help users stay honest as they poke around online.
I included a video above that I thought fit the theme of this article. There are some really good ways to save money if you just look for them. It does require some effort but the rewards can be quite substantial if you follow through with a plan.
Again, if you’d like to look into saving money on your mortgage payments by refinancing to today’s low rates, contact one of our professionals at SLS Mortgage today for a free mortgage consultation. (540) 216-0665