"How should I use my savings?" A Reader Question | Molly's Money


  1. Like Erica, I use Ally accounts for savings. We have our normal bank checking and savings, but then we have Ally accounts for our emergency fund, things we’re currently saving for, and things we have finished saving for. For example, we’re going on vacation in October, and we’ll have all the money saved by July. When we hit our goal amount, I transfer it from the “goal savings” account into the “completed goals” account.

    We use the Ally money market account for the emergency fund – the interest rate is slightly lower, but we have a debit card access so we don’t have to worry about the transfer time if we find ourselves in an emergency. However, we don’t keep the emergency fund card in our wallets so it’s not a temptation to use. 🙂

  2. Currently we have multiple accounts through the online bank ally.com, which has a .99% interest rate. This is in addition to one regular checking and savings at a regular bank, since sometimes it takes a few extra days to transfer money from the online bank, we like to keep some easier to access. We split the money into categories for emergency fund, house fund, car, vacation, and misc (for specific big purchases when we need to save up for something,). I used to have in all lumped into one, but even tracking it as XX saved for vacation, I felt like I couldn’t take it out of savings because I had a hard time separating it mentally from my emergency money, even though the excel sheet said it was for a vacation, ya know? So the online bank was win win, since it was a higher interest rate and it was super easy to make sub accounts and name them for what I was saving for. I think as long as you know what is what, you can do whatever amount of accounts you are comfortable with.

  3. Molly, good article. Especially the part about BUYING USED.

    Let someone else take the hit on depreciation. Cars since 2004 or so should run for 300k miles with maybe a couple of repairs.

    Keep up the good work!

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.