Then using terminal emulator type in the following commands:
cd /system/bin (enter)
sh pm setInstallLocation 2 (enter)
Caution. This will install EVERY new update or download to the SD card. You don't want your widgets on the SD card so you'll need to send them back to the phone when you get an update (like Beautiful Widgets).
If you want to download something new but want it installed on the phone and not the SD card, use the same commands and change the 2 to a 1.