Forum: Adults / Money Matters

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How not to touch your savings?
By DeStijlmember has saluted, click to view salute photosPremium member
On Mon Mar 05, 2012 06:14 PM

I am alright at saving. As a general rule, from any pay check or windfall I receive, I tuck away $25 into a savings account.

I am a student and I work sporadically, so I am not usually saving huge amounts. Also, previously, I've not really had anything big or specific that I was saving up for, so I have a tendency to draw on my savings for stupid little things like new clothes, books, getting my hair done, or panicking and using it to pay bills earlier.

I want to start saving for an overseas trip, so I need to stop drawing on my savings. My self control is lacking, and I can't seem to do that with such an accessible savings account. All I need to do to access funds in my current savings account is log onto internet banking and hit transfer. Its way too easy, especially in the day of iPhone technology. ;)

I've looked into term deposits, but every bank I've looked at requires a $5000 minimum opening balance to start a term deposit account, which I don't have off hand. (If any Australians are reading this and know of a bank that does offer term deposits without a minimum, I'd love to hear abut them).

My question is for those among you who are lacking in self control; how do you save? I am not trying to cop out, but I don't trust myself just to let the money sit for a rainy day at this point in time. I want to have it tied up somewhere in a situation where I can put money in, but I cant get it out easily. If I cant trust myself, the next best thing is to willingly put myself in a situation where I cant access it until I'm ready.

any ideas? Advice? Stories?

27 Replies to How not to touch your savings?

re: How not to touch your savings?
By Leigha_Ballerina
On Mon Mar 05, 2012 06:27 PM
Give the banks a flick talk to your local credit union - there should be one close to where you live in Australia

Comment #9882248 deleted
Removed by Sumayah (204191) on 2012-03-05 19:09:51 double post

re: How not to touch your savings?
By AlwaysOnStagePremium member
On Mon Mar 05, 2012 06:36 PM
I can' speak to the banking side of things, because I've only had experience with US banks...but I think half of the equation is what you're spending it ON. Making it inaccessible is one way to fix it, but finding ways to recognize what you're splurging on and calling attention to it BEFORE buying is another half. The cliche "freeze your credit card in ice" is just a way to set a timer on yourself so you have time to talk yourself out of whatever you are buying. My impulse buy with excess money is personal care stuff: clothes, makeup, hair stuff (because of my resolution to become better at grooming) so I have trained myself to stop and tell myself three reasons I shouldn't buy it. Maybe that would help... figuring out WHAT the money is going to and trying to create a speed bump for yourself to slow down and really consider savings vs purchase.
re: How not to touch your savings?
By DeStijlmember has saluted, click to view salute photosPremium member
On Mon Mar 05, 2012 06:47 PM
^ Yeah, I know where it goes. Sometimes I'll spend it on stuff like text books or bills, just because its quicker and easier. Even though I KNOW I can pay for these things without dipping into my savings, if I am diligent and make changes to my lifestyle to accommodate them, but its safer and more comfortable and easier just to draw on what is already sitting there. Then whatever is left over after that feels so measly I'll tend to splurge it on things I don't really need.

I don't want that to even be an option, since its a habit I've failed to break thus far. If the money isn't easily accessible and just sitting there, then it isn't the safer more comfortable option. I DO have to make those lifestyle changes to meet my bills because in theory, the savings money isn't accessible to me - if that makes sense? I just want to remove it all together as an option to be drawn on.

Identifying unnecessary spending is one thing, but culling it is another. If I had the willpower and cool headiness needed to just cut it out, I would, but as it stands, I don't - so I want to train myself to think of that money as untouchable by actually making it untouchable for the time being. I am sure that once I remove it from the picture and get used to it not being an option, I'll relaise how much I wont miss it and will be stronger in the future about just letting it sit.
re: How not to touch your savings?
By ballerinatwirler
On Mon Mar 05, 2012 06:57 PM
Open a seperate savings account. I have one that is connected to my checking and one at a different bank.
re: How not to touch your savings?
By CaffeinePremium member
On Mon Mar 05, 2012 07:07 PM
Edited by Caffeine (183827) on 2012-03-05 19:26:27
Look into SmartyPig. It's an online account affiliated with the ANZ, and the way it works is that you lock in a goal amount and target date to save towards, then it automatically withdraws a specified amount from your regular account without you having to do anything.

It does require regular deposits (the amount and time you enter calculates the best amount to save per month/fortnight/week), but you can top that up at any time with extra windfalls and the added bonus is that you can't touch it until you reach your goal*. If you don't have the amount in your account when you're due to make another deposit, it just skips that round.

(* you can cancel your goal and close the account at any time, so it's not totally locked in, but for all intents and purposes it's out of temptation's reach).

Interest rate is 5.25%PA, which is comparable to what many of the Big 4 banks are offering for their high interest accounts.

I've uses SmartyPig for years. Firstly to save up enough to pay off a debt, and now so that I'll have enough money for October, when my baby is due. I have a certain amount that comes out fortnightly (the 6th and 20th of each month, my choice). It is all done automatically, so I don't even have to think about it. I love it. I used to have poor impulse control for saving, and this has forced me to rethink my attitude towards money. It's a great tool.
re: How not to touch your savings?
By superholly
On Mon Mar 05, 2012 07:08 PM
I'm pretty sure ING still do savings accounts that arent linked to a card in any way, and it takes 3 business days for a transfer from that account to your savings to be processed. I know they definitely did them around 5 years ago, might be worth calling them and asking them. They also used to have a pretty good interest rate of around 7-8% but that was when our official interest rate was higher, so you might be hard pressed to find one with more than around 4%. They were good because you still had access to the cash but had a few days to think about it before the money came through.
re: How not to touch your savings?
By Sumayah
On Mon Mar 05, 2012 07:14 PM
I do a monthly autodraft for a certain amount from the checking/savings into a different bank's savings. It's a bank that has no nearby locations to my house and is a pain to get to. Then, that account I did not sign up for online services with. If I can't access the account online and it's annoying to go to, it's way harder to spend from. I set the autodraft from the primary account to happen a day or two after I get my paycheck, so I know there's money in the account and since it transfers automatically, I don't even think about it. That's what's helped me.
re: How not to touch your savings?
By MarlaSingermember has saluted, click to view salute photosPremium member
On Mon Mar 05, 2012 07:37 PM
I have an online account with HSBC Direct. I do not have a checking account with them, so when I want to transfer funds to checking, it takes about five business days. So I can't just transfer money on a whim for frivolous purchases - I have to plan it out. They also don't have any branches anywhere in my state, so I can't just go to the bank and pull money out. I don't think there's a minimum balance required, and I've never incurred any weird fees from them.
re: How not to touch your savings?
By mirrimmember has saluted, click to view salute photosPremium member
On Mon Mar 05, 2012 08:10 PM
I hide my savings account from my account summary page. I found that if I didn't see it when I logged in to my bank, I wasn't as likely to spend it.
re: How not to touch your savings?
By mandakp
On Mon Mar 05, 2012 08:41 PM
I'm with Heritage Building Society, I looked up their term deposits but even those still have a $5000 minimum.

Another option is possibly changing your savings account to one of those ones that either only gives you interest if you don't make withdrawals from it, or one that gives you bonus interest if you don't make withdrawals. Could just be an incentive to not touch the money! Otherwise what caffeine suggested it pretty good, I know a few people who have done that.
re: How not to touch your savings?
By Gioiamember has saluted, click to view salute photosPremium member
On Mon Mar 05, 2012 09:24 PM
Like some others have pointed out, an online savings account through a bank like ING or Ally. You typically can't get at it right away without some sort of transfer period. The bonus is that you get a higher yield than a typical bank account, and you can get to it if you need it. Some of them you can get ATM cards for, just don't get one.
re: How not to touch your savings?
By Tiggerpants
On Tue Mar 06, 2012 04:26 AM
Firstly, I don't earn a huge amount of money (my contract is 8 hours a week give or take overtime) so I don't put a huge amount away in savings. What I try and do is put enough away and leave myself with a little bit for treating myself. Example, if I get £500 in a paycheck, I'll put £100 of it away, I know that maybe £200 of it might go on bills, so there's a little leeway there if I want to treat myself to some new jeans/shoes/etc. If I really get it into my head that I want something expensive I wait a couple of months and don't treat myself the rest of the time.

My savings are viewable on my account screen but I guess it's changing the mindset of 'that money's not touchable now'. I've left myself enough money to treat myself and if I go over then that's tough. It's taken a lot to change that mindset because before I had responsibilities (car payments etc.) I'd probably just spend the whole lot on myself without a second thought.

Granted, I'm not saving much, but when I go into full time employment (come on job fairy, help me out here lol) then I'll be putting a lot more away every month.
re: How not to touch your savings?
By Felsamember has saluted, click to view salute photosPremium member
On Tue Mar 06, 2012 04:55 AM
I have an account where I get 3 free transactions a month. My rent comes out of it, my car insurance comes out of it, and I transfer money into it. Those are me 3 free ones. After that is costs me $1.50 each time I touch the account throughout the month. At first I didn't worry about it but then I saw the bank had taken an extra like $20 one month. After that I no longer touch it. The money goes in and none comes out.
re: How not to touch your savings?
By oz_helenmember has saluted, click to view salute photosPremium member
On Tue Mar 06, 2012 05:31 AM
Edited by oz_helen (35388) on 2012-03-06 05:34:07 more
I have an account with ING and Husband has one with UBank. Because they aren't with our regular bank, we actually have to go out of our way to check how much is in there. They earn about as much interest as a term deposit would as well.

By the way, windfall girl, another coming your way very soon. ;)

re: How not to touch your savings?
By Soleil2213member has saluted, click to view salute photos
On Tue Mar 06, 2012 06:02 AM
I have an ING account as well, in addition to my regular savings account. I rarely log into it, and have automatic deposits into it. Since I don't see the money, it's not tempting and since it takes a few days if I were to transfer it back into my regular account, it's hard to spend it frivolously.
re: How not to touch your savings?
By PinUpGirlmember has saluted, click to view salute photosPremium member
On Tue Mar 06, 2012 09:49 AM
No advice, but I totally feel you. It takes about 2-3 business days to get money from my current savings account. I buy a lot of frivolous things, too. I want to start saving for a down payment on a house in the near future, so constantly depleting my savings for new shoes isn't exactly helping that goal.
re: How not to touch your savings?
By Nicci_member has saluted, click to view salute photosPremium member
On Wed Mar 07, 2012 02:55 AM
Community CPS Australia (credit union) does term deposits from $500.
I bank with them so I have a joint savings account with my partner and I've made it a two to sign so if I want to get money out, Tim has to sign for it with me. I've also discounted my other account from internet banking so I can view it online, but I can't transfer out of it.

I've also got heaps of separate accounts with my membership and do pay splits to help me budget.

Feel free to PM me, I work for a credit union and I'm studying financial planning, so I'm happy to help out as much as I can :)
re: How not to touch your savings?
By majeremember has saluted, click to view salute photosPremium member
On Wed Mar 07, 2012 01:26 PM
I just don't think about it. I don't even think "hey I have some money over here...I want to buy such-and-such."

Occasions I do get money out of my savings: On vacation ran out of cash but want to keep the money I have in my checking in my checking. Crap! Need a hotel room but don't have enough in my checking. Those occasions I withdraw cash from the ATM.

I transferred money from my savings to my checking to buy something for the studio I knew I'd get reimbursed for. As soon as I got reimbursed I put it back in my savings.

But usually I don't count my savings in with money I can spend. I just don't think about it.
re: How not to touch your savings?
By Martha_Cecillemember has saluted, click to view salute photos
On Thu Mar 08, 2012 03:58 PM
the deal for my new savings account is just too good to touch it.
and my second savings account is called "my parents" ;) they won't give me the money they want to give me for just anything, they want it to be something resonable like for a new car or something.

Maybe you could check with your bank what they can offer you. Many accounts are not very clever for students or people with low income, because they will probably need the saved money soon :/
re: How not to touch your savings?
By elliebelliemember has saluted, click to view salute photosPremium member
On Thu Mar 08, 2012 05:20 PM
I work for one of the major banks in Aus and I think it'd be a good idea to go into your local branch and work out a savings plan and a budget plan. Doesn't mean that you need to stick to it, it's just to give you an idea on how much extra you can afford to save.

Also, have your savings account de-linked from your netbanking that way you will only be able to know your balance if you go into a branch or call up. Even have your money direct debited for your savings when you get paid. That way you don't have to decide how much to put into savings it's set at that amount and you work out your expenses from whats left.

Also, analyse what is unnecessary in your expenses. Buying new clothes every week and new haircut every month? I hate to say it but that's a silly reason to touch your savings. Touch your savings if you need to buy a new appliance in your house because the old one has died and it is urgent you have a new one, unexpected medical expenses... Blah blah blah.

Don't spend your savings on frivolous things, spend your savings on what you actually WANT to spend it on, your overseas trip. You are only making the process longer if you keep touching your savings!

re: How not to touch your savings?
By SarahdncrPremium member
On Sat Mar 10, 2012 04:02 AM
Edited by Sarahdncr (214611) on 2012-03-10 04:09:34
Edited by Sarahdncr (214611) on 2012-03-10 04:10:07
I have my investment funds and a set cash amount taken directly out of my paychek each pay period. The cash goes to a money market account that earns a fixed rate of interest as long as the minimum account balance stays over $X.XX (rates not doing anything terrific these days btw. That is the best way to save, set up somehting where you are forced to do it. Back in the day, banks used to do Christmas Clubs, where were an excellent way to save for something quite like what you are trying to do.

Now unfortunaly, I am not sure how many of you younger folks or those still in uni who only have small part time jobs will be able to do this. I don't know to what level of sysfistication your employers payroll systems would allow for an arrangement like what I have.

Barring that, my best advice would be just to stash the cash away like you are doing (and very good on you for having the forethought to do it), and just apply the same prinicples of dicipline that you apply toward your dancing, and don't touch your saved money till you are ready.

Oh, one big thing I almost forgot. I have three other savings accounts at different banks that I also feed from systematic direct withdrawls out of my pay. These are savings accounts only, and I purposely refused the banks offer of a convienience "check card" for them, nor do I have internet access to them, so if I want to move money around I have to use a phone. Get an account without convienient access to it whereby you actually have to walk into the bank to do business, and start putting regular savings amounts in that account.
re: How not to touch your savings?
By DeStijlmember has saluted, click to view salute photosPremium member
On Sat Mar 31, 2012 02:06 AM
Thank you all so much!

I went into a branch and asked if I could put a transfer block on my existing interest earning account. Its was very easy and I wish I'd done it sooner. Now I can electronically transfer money into that account, but if I want to get it out again, I have to go into a branch, show three forms of ID, have the block lifted and then transfer it. It has nipped my rainy day splurging in the butt completely.

My goal now is to save the minimum required deposit for an even higher interest fixed term account.

Thanks again, I got some wonderful advice to consider for the future here.
re: How not to touch your savings?
By pokomember has saluted, click to view salute photosPremium member
On Thu Apr 05, 2012 03:53 AM
I have an account which a percentage of my wage goes into every week. To access the account, I need the signature of both myself and my mother. And she knows I have a car to pay off and a desire to go back to England, and she's one stubborn mother so there is no chance she'll sign for anything except that! Haha.
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