Savings is the backbone of healthy financial well-being, but what’s the best way to save? Opening a savings account and adding funds or setting up regular automatic transfers on paydays, is easy, but is that enough? To make your savings “stick,” you might consider opening multiple accounts to break your money up into multiple goal-driven, mini-accounts.
Here are a few benefits of having multiple savings accounts:
Staying Motivated: One big reason multiple savings accounts work so well is they help you stay motivated to reach each of your goals. Being able to see how much exactly you have set aside helps you feel like all your hard work is paying off, literally. Every time you login into online banking, you’ll literary see your “Vacation Savings” or “Emergency Savings” growing and know that you’ll be enjoying that dream beach vacay in no time.
Reach Your Goals: This tactic can also help you realize what you really want. Do you want to travel? Open an account and make it happen. Do you want to go back to school? Open an account and start saving for tuition. Do you want to buy Christmas presents without maxing out your credit cards? You know the drill… open a new savings account and start saving up for Santa.
Get Out of Debt: It’s also a great way to live within your means and accomplish your goals. You won’t have to worry about going into debt or paying high interest. In fact, if you choose an account that’s interest bearing, your goals could even pay you! With a High Yield Online Savings account you can earn higher than average yields on your money.
Juggling multiple savings accounts, might not be right for you. Make sure that you’re able to effectively manage them and that your accounts are helping you reach your big picture goals. For example, if you’re not saving enough of your income for retirement, opening a new savings account up for travel may not leave you better off in the long run.
If you have questions, we’re always here to help.
*Next week we will be talking about a “30 Day Challenge to Help You Jump Start Your Savings”.