The term "impulse buy" has long been part of the American lexicon—from the muffin you decide to get at the last minute with your morning coffee, to the latest novel you just had to pick up with a coupon set to expire.
But a new company called Piggymojo is looking to turn this term on its head and get people thinking about "impulse saves." It is trying to make saving $2.75 with your morning coffee as gratifying as biting into a fresh-baked blueberry muffin.
"We looked at how spending all this money feels really great, but savings feels bad as there is no immediate satisfaction, and we tried to change that," says Jayson Halladay, Piggymojo's CEO and co-founder.
Users set weekly goals for how much money they want to avoid spending. Then each time they pass up on a purchase, they text the "save" to Piggymojo, which automatically tallies the amount toward their goal and, to provide an instant pat on the back, forwards the news to their savings partner, typically a spouse or significant other. (The other co-founder of the New York-based company, Leah Solomon, is Halladay's wife.)
And rather than recording saves on a boring spread sheet, Piggymojo gives each user their own Web page. The page features reminders of what they are hoping to do with their savings—like a picture of the new car or exotic vacation spot. The images are hidden at first and then slowly revealed square by square as the saves add up.
The company is in the process of adding another incentive to the impulse save by making money move from a user's checking account to a savings account with each text that is sent.
Piggymojo is in the early stages of testing this process with the $10.4 million-asset Brooklyn Cooperative Federal Credit Union. It is also looking for other credit unions and community banks to partner with in hopes of making its savings program a white-label product that institutions can market as their own.
"Once money starts moving, I think the whole experience will be much more alluring," Halladay says, noting that he is looking for financial institutions that have a lot of enthusiasm and willingness to try something new when it comes to a fund transfer.
In March Piggymojo received a $300,000 grant from the Center for Financial Services Innovation's Financial Capability Innovation Fund to run its test with Brooklyn Cooperative. Halladay says this partnership will help the company determine what licensing fee it will charge to institutions that sign up in the future.
Samira Rajan, Brooklyn Cooperative's CEO, says that what she found appealing about Piggymojo is how it takes all elements that go into seducing someone into buying a product—from the placement on the shelf to the design of a sale sign—and applies them to savings.
"Look at all the marketing that goes into getting people to pull out their pocketbooks and spend money," Rajan says. "It would be a huge victory to make a dent in this culture of consumption and get people excited about savings instead."
Still, Piggymojo has a long way to go to make this dent. In the nine months since its website got up and running, about 1,000 people have tried it out, averaging $15 per save.
Halladay envisions interest picking up once the service is offered through financial institutions and tied to actual savings. He expects to have the Piggymojo platform integrated into Brooklyn Cooperative's systems within six months, so that its members can start charting impulse saves and seeing their money move.