San Francisco-based money management and savings startup Digit has added an automatic investing tool to its app.
Digit brands itself as a financial wellness specialist that has helped its users automatically save $5 billion and pay down over $150 million in debt. The firm's algorithm analyses users' income and spending patterns, looks at their goals and takes part of their income for savings or debt payment.
Now, the firm is putting the same data and knowhow into a feature that automatically moves money into retirement and/or investing accounts.
Digit says that its offering beats other investing tools because it doesn't require users to have predictable disposable incomes - something particularly important during the economic uncertainty caused by Covid-19.
Says a blog: "Digit's algorithm makes sure you're always improving your financial health in a way that's right for you. And unlike other investing tools, Digit looks at your larger financial picture so that you can make real progress on all your financial goals at once."
For investing, customers make a long term goal for their investment account and answer one question. Digit then matches them with a conservative, moderate, or aggressive portfolio of diversified ETFs and sets aside what they can "afford" and invests that money directly into a portfolio every few days.
For retirement, the app matches users with a Roth or Traditional IRA based on income and picks a diversified portfolio based on age. Digit puts money aside and invests it in the retirement every month.