Christmas is coming quickly, and if your financial habits are like my past financial habits, you’re starting to wonder how you’re going to pay for Christmas. It’s not a fun feeling, and it’s one I understand.

I’m happy to say I’ve changed my ways. And the good news is that you can too. It’s not that my financial situation changed much. We’ve had our up years and our down years. But I started planning for Christmas much earlier…like in January.

SmartyPig is a Savings Account

Last year I discovered SmartyPig, a “social savings account.” Really, it’s a bank account with West Bank, which is FDIC insured. Right now they’re boasting a 2.0% APR, which is one of the best interest rates I’ve seen for an online savings account in a while.

When you set up an account, you set a financial goal. For instance, you set a goal to save $500 by next Christmas. SmartyPig calculates how much you need to save each month to reach your goal and automatically transfers the money from your bank account to your SmartyPig account each month.

Don’t worry. If you run into financial trouble and need to get your money out, you can cancel your goal and do that. So you’re not stuck by any means. And the best part? It doesn’t cost you a thing!

SmartyPig Gives You Cash Boosts

Here’s where SmartyPig differs from a regular bank account, though. And here’s also where SmartyPig can help with Christmas shopping. You have three options for withdrawing your money. You can transfer it right back to your bank account. You can opt to get a SmartyPig MasterCard debit card. Or, you can get a gift card from one of SmartyPig’s partners.

If you choose the last option, you will receive up to a 12% cash boost! And you can put your money on multiple gift cards, too! That’s why I think it’s so great for Christmas shopping. I tend to buy a lot of books for Christmas gifts (or even homeschooling during the year), so getting a Barnes & Noble gift card is a great option for me.

SmartyPig is Social

SmartyPig also has a social option, which I’ve never used, but could be a good thing if you’re saving toward a big goal. You can allow your friends and family to search SmartyPig by your email address, so they can see your goals and contribute. You can also place a SmartyPig widget on your blog or Facebook page to show the world how you’re progressing toward your goal.

Last year I used SmartyPig to save throughout the year, and by September I had enough to buy a Wii and some Wii accessories for the family for Christmas. It was well worth it.

With it’s competitive interest rate, multiple options for withdrawing your money, and bonuses for putting your money on gift cards, SmartyPig is a great option for a Christmas savings account.