Excess balance nudges were designed to help people save who but don't know exactly how much they can save or when, most likely because their month-to-month finances changes frequently.
The basic idea is for Marygold to notify you when your current account receives your income (i.e your pay), and suggest you save any surplus (or part there of, %) in your current account that was there before the most recent payment in:
It works like this:
- Link your current account to the Marygold app.
- Specify a trigger amount which, if exceeded by an inbound payment into your Primary Account (your external current account), will generate a notification. For example if you get paid once a month roughly £3,000, you might set the nudge trigger to be anything over £2,500.
- Set the percentage of the excess you'd like to save (e.g. save 75% of the excess).
These nudges are very good for anyone that simply does not know what their month-to-month budget is, but would like to save regularly what they can. The simple theory is if you didn't spend it last month, you might be able to save it now given that you have just been paid again.
When each notification is generated, you have the ability to:
- Click 'pay now' and move the money as suggested. Your bank app will open, with the appropriate payment details complete, for you to simply review and authorise.
- Click 'edit'. This will open the Marygold app and allow you to change the transfer instructions for this time only (you can change the amount and/or destination accounts), then take you on to your bank app for a second review and authorisation.
- Click 'ignore'. Which simply means you want to skip the saving this time, but receive future notifications.
It means you remain in complete control. You do not have to think too hard, in advance, about whether you can save on any given future date or not. It also helps keep your balances held in (typically) low-interest bearing current accounts, to a minimum.
Lastly, excess balance nudges can be used very effectively in combination with other nudges. For example you may wish to save some of your pay each month as soon as your money is received, because you are saving for a particular goal. However, you suspect you could save more, but as your spending goes up and down each month, you don't know for sure how much extra you can save.
In this example you could create pay day and excess balance nudges. The pay day nudge will encourage you to allocate some of your new pay to savings, and the excess balance nudge will help you 'sweep' up any excess available that you didn't spend in the last month (if it is available). You will get one notification to pay the combined suggested amount, which can be allocated to one or many spending goals (money pools) you may have with Marygold.