Okay, on first glance that seems like terrible advice. You need your money. And you certainly don’t want to be caught short when you’re shopping for groceries or need gas.
That said, I’m happy to report that keeping a certain amount of money inaccessible is doing wonders for our savings.
Automating your finances has been lauded by PF bloggers for ages. It’s a no-brainer. But it’s something I’ve never really felt comfortable doing. The only automated part of our finances is the amount subtracted each week toward my IRA.
With the ING account, though, things have gotten a lot easier. I still don’t automate the withdrawals. My check is mailed to me, so it can come anywhere from the 8th to the 12th — and then we still have to get it into the bank.
Once it’s in the bank, though, I cruise on over to ING and transfer in $300: $100 for savings, $100 for Medicare premiums and $100 to the relative who loaned us money.
It’s not a lot, I know. Obviously, I want to put more in savings as things stabilize. But the point is that I take it out before I start allocating monthly expenses, credit card payments or anything else. It’s automatic, and it’s safely tucked away.
Similarly, I recently had an “Aha” moment with PayPal payments.
I always transfer them into our main checking account. Before I can get much done with those funds, they get sucked up by the latest emergency. If I’m lucky, half of the amount goes to debt or savings or whatever.
I linked PayPal over to my ING account. Now I can transfer the funds directly to our safe, online account where they won’t be touched.
That’ll add up big time for my monthly Mr. Rebates payouts, when I get advertisers or when we sell eBay items.
In fact, we recently sold some cards on eBay. After postage and fees, we made about $160. There were some other funds in the account, and so I sent a whopping $255 to ING, secure in the knowledge that every cent will go into our savings account.
It’s a small step, but it’s already paying big dividends.