Okay, so we know that college students often struggle with their finances. It’s hard to maintain college tuition, living expenses and then afford to just treat yourself in this cruel academic environment. Luckily, an automated savings startup called Digit has helped many college students and in general people bad with their finances save money for rainy days. Today, the company is rolling out a feature that will make every savvy person or wannabe savvy person extremely happy. It will allow users to save and pay their monthly bills.
For those who do not know, Digit works by scanning the bank accounts of users’ to measure their cash flows. It then algorithmically determines how much money it can save from them. Now that you’ve started using Digit it will start extracting a small amount of cash from the deposits and adds to it own savings. Users can access these savings any time.
Digit operates by deducting so little that users hardly notice any change in their bank money. This is the sweet goal of saving up money for a rainy day. The money that is gone into savings starts off small but builds up to larger balances overtime. It publicly launched two years ago and is working awesomely providing it helped users save more than $350 million.
The new bills feature is helpful in moving the company to a point that involves more than saving money for a rainy day fund. Adding bill payment to the algorithms is a natural extension of what Digit is already getting on which providing it has information on your spending and earning pattern.
Monthly bills still have to be payed by the user while the app saves for them
So it works when users open the app Digit where they will see a new Bills feature in the keyboard. The feature button will allow them to define their monthly bills and how they would like to save for them. If you choose “new bill” in the option then you’ll be able to set the amount to save and due date of the bill. Automatically paying your bills and saving all the while. Sounds pretty easy and convenient, because two days before the bill is due, the app will automatically remit the amount it has saved. You will get a text alerting you of the transaction. You’re going to get a text if for whatever reason a bill savings target is not being met.
The company soft launched Goalmoji last year and Ethan Bloch (Digit CEO) wanted to see how the bill savings would lead up to more advantageous savings position for the users. Goalmoji basically allowed users to create their goals with target amount definitions and adding emojis to it.
Only 10 % of the people noticed goalmoji
Not many people noticed the feature but the 10 percent who did actively used it. Many used it to define their goals relating monthly bills. This was the signal to the company to alter its algorithms to start saving for more essential bills first by setting aside money.
“A lot of people are living paycheck to paycheck,” Bloch said. With the new bills feature, he believes “they can have their rent and car payment taken care of and not have to worry about it.”
Digit will help users save for their bills but they still have to pay for them. However, this makes one possibly think that in the future you can have a company or a system like Digit which would automate your finances and pay them. This would never have you missing payments or having overdraft fees render a burden to your account. The future sounds glorious, my friend!
Image via investor junkie