I recently learned that my bank allows me to open an unlimited number of savings accounts and give each one a nickname! (Which has made saving way more fun and effective).
- Emergency Fund? Check.
- Fairy-tale Wedding? Yes, please.
- New Bedding Collection? Sure.
- Holiday Gifts? Check.
- Travel? Definitely.
There are literally dozens of things you can save for separately—a down payment for a home, car insurance, new furniture—and doing so really does “stretch” your money farther.
However, before you open 6+ accounts like me… a few things to consider:
Some banks charge fees if you don’t meet certain deposit requirements and/or if you exceed withdrawal limits. For example, my bank will charge me $5.00 per savings account if I don’t make monthly deposits of $25.00 and if I make more than three withdrawals. So it’s important to make sure you can meet these types of requirements before opening multiple accounts. This is a good thing though! It encourages you to keep making deposits and not take money out.
Having multiple savings accounts is great if you’re just starting out or you’re trying to meet short-term goals, like saving for 2015 holiday gifts. But if you’re doing really well and saving a lot (which I hope you are), you should explore investing because that’s where you’re really going to see a return. For more information on that stay tuned, or check out this article.
Please, please, please keep in mind that mass savings doesn’t occur overnight. No one wakes up one day with 3-6 months’ worth of salary in an emergency fund, so don’t get frustrated and don’t put off starting. The whole point of saving is to put aside a little now for more later. If it takes you months or even years to reach your goal, that’s great! In fact, that’s perfectly normal.
So if you’re reading this, trust me, open up a few savings accounts and give each one its own goal. You’re going to get great at budgeting, and you might even enjoy it! After all, who doesn’t love to watch their money grow?