Dobot: The Ninja Saver
Do you have trouble setting aside money for savings? Do you struggle with with meeting your savings goals? Do you even try? Honestly, most of us don't. Now we don't have to.
According to a survey done by GoBankingRates in 2016, more than one third of Americans have less than $1,000 in their savings account. And another third don't even have a savings account! So if you think you're the only one struggling with putting away money for that emergency fund (or that car or that down payment for a house or that new laptop or...), you would be wrong. You're not alone.
What's keeping us from saving money? Our biggest obstacle is ourselves. No, we don't all have thousands of dollars in disposable income. No, we can't all set aside 30% of our paychecks for savings like some financial gurus try to suggest. But I bet we can all set aside $5 from time to time. Or even $25. Would you even notice if your paycheck was $5 shy every time? A lot of us wouldn't. So why don't we all save these little bits of money we won't miss? Maybe because it feels like trying to make a meal out of breadcrumbs. But the reality is that $5 here and $10 there add up. If you got paid biweekly, and could spare $40 a paycheck, you would be doing better than 2/3 of the American population in the span of one year with $1,040! But none of us are doing it.
I don't know about you, but when I have a little bit of extra money in my account, I spend it. I end up taking a pass on packing my lunch for work and buying something instead. I buy a new digital album. I get some ebooks. I end up in Target. Somehow, the money is gone before I can even think about saving it. Even if I do think about it, I don't want to be bothered with the hassle of transferring $5 (when in reality, with banking apps nowadays, it really is no hassle and takes no more than a couple minutes). Whatever the reason, I just don't do it. Unless I happen to end up with an extra $100, I'm probably never going to transfer it over. And let's be honest, how often does the average American who's living paycheck to paycheck have an extra $100 lying around? Almost never.
Enter stage right, Dobot. Dobot is a relatively new player in town that does all the legwork of saving for you. It figures out how much to save, when to save, and then transfers the money to a savings account on your behalf. They're so invested in you saving, that they'll give you a signup bonus. I know, you have questions. Let me start by answering the 5 basic questions we learned to ask in elementary school.
- Who? Dobot is more of an 'it' than a 'who'. The whole program is fully automated by fancy-shmancy software and there are no extra people getting entangled in your finances.
- What? Dobot is a financial tool that skims a little off the top of your bank account and squirrels it away for you, somewhere safe where you won't spend it (at least not so easily). Dobot is also completely free of charge; no fees, no subscription, no surcharges, no cost at all.
- When? Dobot will analyze your account every few days and, depending on your situation, will make subtle withdrawals that it sees fit. These withdrawals are strategic in that you will never feel the pinch of being without that money. It won't take half your balance when your rent is due or wipe you out just before you pay your phone bill. It's well-timed and well-calculated.
- Where? There is no brick and mortar location for you to visit. Dobot is completely online. Their website really only houses basic information and FAQ's. To actually interact with Dobot, you need to download the app on your mobile device (apple or android). Through the app you can connect your bank account, initiate voluntary transfers either into or out of your Dobot savings account, refer friends, and set up savings goals. You can do a lot of these features via text as well, but you need the app to setup your account initially. And no, your money isn't going to get lost in the ether - your funds are FDIC insured just like at a standard bank.
- Why? Because we won't do it ourselves. Because apparently, we need some hand-holding when it comes to saving our own money. Because we are our greatest obstacles to achieving our financial goals. Dobot does this for us so that we don't have to.
- How? Dobot uses a clever, and slightly terrifying, algorithm that monitors your bank account. It analyzes your spending habits, your income, your outgo, your balance fluctuations, etc. It learns your financial situation, and then makes a decision every few days about what can be saved. Sometimes, it might decide you can't afford anything and won't take anything out. Other times, it will decide you can spare some money and it will move it into your Dobot savings account. This algorithm is somehow able to determine how much money you can spare without feeling the pinch. In other words, you will barely notice that Dobot is quietly building up your savings account. Just like a ninja, you'll never know Dobot was even there (but not really like a ninja because Dobot always tells you when it moves your money).
You still have more questions, though. I know; I did too. Alright then, let's just keep going.
How can this possibly work without screwing me over financially? That's what I wondered at first. I get paid weekly but my hours fluctuate. I can't even predict how much money I'll make in the next few weeks, how can a robot figure it out? But I was intrigued. I did some digging. I scoured the internet. I read countless reviews. Not one review said they had any issues with the amounts being withdrawn from their account. (I saw one reviewer that complained that they couldn't make sense of the amounts, but never said that they were problematic.) This included freelance workers whose income fluctuated far more than mine ever would. This included low and high income people. All the reviews seemed pleasantly surprised with how little they were affected by the robo-withdrawals. In fact, Dobot is so confident in itself that it offers to reimburse any overdraft fees that you incur if they mess up your account.
How much will be saved through Dobot? That depends on several factors. The amount taken out will vary week to week for each person, and will vary from person to person. It's based on your disposable income, your cash flow, your income, your upcoming bills, your transaction history, etc. I couldn't even begin to guess how much will be taken out for you - whatever formula Dobot uses to figure it all out is a mystery to apparently everyone that's not Dobot. But it works.
Well that's all fine and dandy, but what's the catch? Dobot uses highly secure software that supposedly meets or exceeds most banks. It provides a valuable service to their customers. It's managing your funds on your behalf. This comes at a cost, of course. But they don't pass that cost on to you at all. The way they get paid for their services is that they keep the interest made off of the money you have in their savings accounts. What this means for you is that you earn 0.00% interest on your savings. Now before you get all huffy and complain that this rate is unacceptable, remember that if it were not for Dobot, you wouldn't have any savings. Making 0% interest on $100 comes out to a lot more money than earning 500% interest on $0 (and no, there are no banks offering 500% interest, I'm just making a point). Also, Dobot allows it's customers to make as many withdrawals whenever they want, however often they want. So you can choose to relocate your funds, say, every month or every $100, and move it into an interest bearing account.
How long does it take to get my money back? As with most online-only banks, you cannot get your money instantaneously. There is no ATM card that you can use, no checks that you can write and no QuickPay that you can utilize. However, the website states that so long as you put in the request before 3pm, you will most likely get your money the next business day. (Money will always be deposited into the same account it is withdrawn from.) Since it's a savings account, many people consider this a perk instead of a deterrent as it discourages unnecessary dipping into your emergency fund (or whatever you're saving for).
Are they the only ones that do this? No. In fact, there is another company out there that does almost the exact same thing but is arguably more popular. That company is Digit. Same concept, same service down to the 0% interest rate. There are, however, three fundamental differences between the two. 1) Dobot allows you to setup and save towards specific goals. You can setup multiple goals each with their own amounts, deadlines and a picture for motivation. You can apply the money in your Dobot account to these goals and Dobot sends you encouraging message throughout your journey. UPDATE: Digit seems to have recently gotten in line with setting up goals, though I honestly haven't dug into it too deeply. 2) Digit does offer savings bonuses that are based on how much money you have in your Digit account, which it assesses every 3 months. The rate fluctuates, presumably with the market, but at the time of this post it is at 1%. 3) Dobot is free. Digit charges $2.99/mo after their free trial period. For this reason, I didn't bother getting the details on their goals setup and their savings bonus. I know I'd have to have $299 in my savings account for a full year to just break even with their monthly fee. To me, stressing about whether or not I'm losing money or making money isn't worth it. I also know that I can open an online savings account with Ally Bank and earn 1.05% interest and not worry about monthly fees at all. So while Digit is incredibly comparable, I consider Dobot to be the superior product.
Does Dobot offer any perks to being a customer? Yes! They have a referral program. If you refer a friend, both you AND your friend get $5 deposited into your Dobot accounts. There doesn't seem to be a limit on referrals either. Personally, none of my friends had heard of Dobot or used it so I had to hunt down a referral code online to get my signup bonus. To save you the trouble (wink, wink) and so you don't miss out on a free $5, if you sign up then simply use my referral code. Yes, I benefit from it, but so do you! $5 all around! Who doesn't want free money? Even if you decide not to keep the account long term, why not at least get your $5? Go here to get $5 when you sign up. It's that easy!
Phew. That was a lot of questions. If you have more, comment and I'll try to answer them. Or you can always visit Dobot's FAQs page online.
So now that we know what Dobot is, the question becomes "how will it really work in real life?" I only just discovered Dobot existed about a week ago and recently signed up. I haven't even had my first withdrawal yet. But I already took the plunge so if you're still on the fence, subscribe to my blog so that you can easily check in on how Dobot is working for me. I'll keep close tabs on my Dobot adventure, and I'll chronicle my journey with you all to let you know my personal take on it. I admit, after reading all the reviews, I have high hopes. I read several people say they went on multiple vacations with money that was 100% funded by their Dobot account. Some people claimed saving a few thousand without even realizing it was happening, others stated only saving a couple hundred. My money is tight enough that I don't expect to save thousands, but I'm hoping for something significant. I'll let you know how it works in a follow-up post.
"Don't judge each day by the harvest you reap but by the seeds that you plant." - Robert Louis Stevenson