Tuesday Tip - Multiple Savings Accounts
I like to save up money ahead of large purchases, say a used car for a teenage driver. And in the past I would keep some of that money in the checking or savings account that we use regularly. The problem with that is sometimes the money can get diverted to other expenditures. Then you don't have what you want or need when you need it.
Tip: Open a separate savings account at your bank to save for larger purchases. This works well for when the saving period is over a longer time frame (like a year or more).
We do this already with our "Vacation" and "Home Improvement" spending accounts. It just dawned on me to do the same for the know future expenditure of a used car for our soon-to-be new driver. By having a completely separate account dedicated to saving up money for a car, we don't run the risk of thinking that money can be spent on anything else. Because the account is linked to all of our other accounts, we can easily set up transfers to the account.