Want to Save More Money? Make Your Savings Hard To Get At

The first step to financial fitness is savings. Everyone should have a savings account. The problem is that even though many do have one, there never seems to be much money in them. And that's because our savings account is usually the first place we look when we're a little strapped for cash.

If you want to reach your savings goal, you have to keep that money out of easy reach...and no I don't mean a cookie jar on the top shelf. It's for your goals...the things you decided you needed to be prepared for life's foibles. It is  not for those moments when you're temporarily a little short on cash. 

So how do you keep from dipping into the piggy bank?  Here are some ways to make your savings VERY hard to get at:

1. Keep your savings account at a different bank than your primary bank. Having both your primary checking account and your savings account at the same bank makes it too easy to just transfer money from savings if you're a little short on cash. If your debit card is linked to your savings account, that's even worse. Now you can access your savings from almost anywhere! 

I recommend keeping your savings in a totally separate online account. This will definitely cut down on the speed with which you can access your money, which means you might be more likely to look for ways to stretch your dollars until your next payday, instead of pilfering your savings. Plus online banks often pay a higher interest rate on savings than your neighborhood bank. 

If you would prefer to use a brick-and-mortar bank, then open a separate savings account at a bank you don't normally use. Preferably on the other side of town. Do whatever it takes to make taking money out of your account as inconvenient as possible. 

2. Do not link your debit card to your savings account. Again, this just makes it too easy to access your savings. Many banks will give you a card automatically when you open your savings account. They might advertise this as a benefit of setting up an account with them, but it's not. So if you have the option, tell your bank you don't want it. If you already have one, cut it up. If you simply can't imagine not having one, then at least keep it locked up at home and not in your wallet.

3. Reduce the amount of your contributions if necessary. Let's be real. If you are putting a substantial sum into your savings account each month, only to take some of it out again each month, something isn't working. 

It's much better to put a smaller amount in your savings each month and LEAVE IT THERE.

One of the easiest ways to grow your savings is to put money in an interest-bearing savings account and don't touch it.

Have you found yourself dipping into your savings more than you should? How have you stopped? Share your tips in the comments. 

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Know How Much You Need To Save

The first step to making sure you won't be running out of money in an emergency is to know how much you'll actually need. Yes, I know...the typical advice is 3 - 6 months of expenses. But do you know exactly how much you REALLY need?

Don't use guesswork. "I make $4000 a month so that's how much I need." Maybe. It depends on how that $4000 is spent each month. If it all goes to cover essentials, you are correct. If not, you could possibly manage for a bit with less.

You can get started by determining where your money goes each month. This is somewhat like making a budget. Add up all of your income for a month. If you're a dual income family, both paychecks count. Then add alimony, child support, any income from side hustles, investment income...if money comes in to your bank account, add it to your income.

Next take a look at your expenses. Which are absolutely essential? Rent or mortgage payments, food, utilities, obviously. But what else do you absolutely have to pay each month? Car payment? Probably. Insurance and vehicle maintenance costs (this includes fuel in my book). Is anyone in your family on regular medications? They'll need to keep taking them. Childcare? That could depend on the type of emergency. I would always err on the side of caution. Better to have more than you need than not enough.

Anything that does not have to be paid each month...meaning it's something you don't need for survival...is non-essential and can be cut if need be. You can live without cable TV, or your morning Starbucks run. You won't die if you miss a spa day. 

Add up your total monthly ESSENTIAL expenses. Multiply by six. That's how much you need to have saved for emergencies. 

Now...how to do that.

Many experts recommend saving 20% of your monthly income. That's great. If you can do it. But if you are already stretched thin, taking out 20% could be difficult. Start where you can. Something is better than nothing. The important thing is to get started saving now! The sooner you start, the sooner you will have your financial cushion ready for emergencies. If you can only save $5 a week, do it. But do it consistently! Once you figure out how much you can save each month, do it EVERY MONTH! No excuses. A little self-sacrificing now may make all the difference in an actual emergency.

Check out these posts for some additional information on saving money:

Why Did I Buy Those Shoes?!

Set A Savings Goal

The First Step to Saving Money - Spend Less Than You Earn