Earlier this week, the Digit app announced that it would start charging $2.99/month for its services. Current users can continue with the service for free until July 20, 2017, but new users start paying the fee immediately.
In addition to charging the fee, Digit is hoping to entice users to stick around by increasing its savings bonus to 1% annually. Digit is a money management app that pays a savings bonus based on your average total balance over the previous three months.
Here’s the email Digit sent to current users:
Judging from the comments on the Digit Facebook page, a number of users plan to close their accounts due to the new fee.
Is the Digit app worth it?
The Digit savings algorithm works by analyzing your income and spending habits. Then, money is automatically transferred from your bank account into the Digit account. This is a way to save a little extra money without thinking about it.
Up until now, the Digit app has been free. With this change, users need to evaluate whether or not it makes sense to pay nearly $3 per month to keep using it. Weigh the convenience against the cost, and consider how much you need to save to offset the fee.
With a monthly fee of $2.99, you will pay $8.97 each quarter. Your savings bonus will amount to 0.25% each quarter (1% annually divided by four). That means your average total balance over those three months needs to be $3,588 in order to break even.
Unless you regularly save close to $1,200 a month using the Digit app, those numbers might not add up for you.
Of course, if you decide it’s worth it for the convenience, it might make sense to stick with Digit savings. After all, even if you manage to save an extra $50 to $100 each month without thinking about it, you might think $2.99 is a small price to pay.
How to cancel your Digit account
If you decide to cancel your Digit account, simply go to the close account page and log in.
Next, you have the chance to withdraw your balance and transfer it to your bank account. Digit makes the transfer within one business day, so you should receive the funds quickly. Closing your account is a quick process and you will receive a confirmation via email.
Digit will keep your contact information for up to 90 days before it’s completely deleted. This way, if you change your mind, you can reactivate your account during this 90-day period.
3 alternatives to Digit
If you’re ready to switch to a different savings app, you have many options. Digit’s main draw is the hands-off approach. Since Digit analyzes your spending and makes the determinations automatically, there’s not much you need to do beyond connecting your bank account and choosing goals.
Other savings apps require a little more work on your part, but at least they cost less. Here are three solid — and completely free — Digit alternatives:
1. Tip Yourself
Tip Yourself is basically a virtual coin jar. Link your bank account, and then you can decide to pay yourself any amount you want.
One way to do this is by banking your savings immediately. Used coupons to save $5 at the grocery store? Use the app to move those savings into your Tip Yourself account. You can also “reward” yourself for actions like healthy eating and going to the gym. There’s also a social aspect that helps you stay accountable for your goals.
Tip Yourself is free and you can withdraw your savings at any time. The app is currently only available on iOS, with plans to expand to Android in the future.
Qapital allows you to automate your savings based on the way you live your life. It’s based on rules you make for yourself. You can make a rule to save money when you spend less than anticipated at a specific store. It’s also possible to connect Qapital with IFTTT. If you connect the two, you can save each time you post to Instagram or every time your weather app shows it’s a sunny day.
According to Qapital, the most popular savings method is the “round up” method. Your purchases are rounded up to the nearest dollar. The pocket change is saved, with the average user automatically saving $44 each month — without any fees.
Qapital is available on iOS and Android.
EvoShare is a little different. Instead of a savings app, it’s more of a cash back app. When you shop at more than 1,000 online and local businesses, a portion of your purchase is automatically used to fund your retirement, start a college fund, or pay off your student loans.
This automatic savings tool doesn’t offer you the option to withdraw your money. Instead, it goes right toward the goal you choose. If you choose retirement, it goes into your tax-advantaged retirement account. If you choose student loans, it pays down the account. For those without any of those accounts, EvoShare keeps the money until you can put it toward a specific goal.
EvoShare takes a little longer to set up. You need to link your account and the proper debit or credit cards to ensure that participating visits are “counted” offline. On top of that, if you want the savings online, you need to use the dashboard or Chrome extension.
So if you think $2.99/month is just too much, you don’t have to stick with the Digit app. There are other options available to you, no matter your goals.
But if you’re still on the fence, check out our full Digit review. You need to use the app the works best for you and your savings goals.
Interested in refinancing student loans?Here are the top 6 lenders of 2019!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for SoFi.
2 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 7.89% APR (with Auto Pay). Variable rate loan rates range from 2.54% APR (with Auto Pay) to 7.27% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of March 18, 2019, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 0318/2019. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
3 Important Disclosures for Laurel Road.
Laurel Road Disclosures
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the fixed rate will decrease by 0.25%, and will increase back up to the regular fixed interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.5% effective February 10, 2019.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.54% – 7.12%3||Undergrad & Graduate|
|2.54% – 7.27%1||Undergrad & Graduate|
|2.67% – 8.96%4||Undergrad & Graduate|
|3.23% – 6.65%2||Undergrad & Graduate|
|2.69% – 7.43%5||Undergrad & Graduate|
|2.98% – 9.72%6||Undergrad & Graduate|