My situation is the following:
- I want to automate as much of my finances as possible
- I want to have multiple savings goals (perhaps house, wedding, new car, or recurring 'savings' items like car maintenance, etc)
- Some money will be for specific purposes (ie emergency fund)
- I want to clearly know what money is allocated where
- I want this to be easy to setup
I have been trying to find a way to, well, partition my bank account very clearly (and not using Excel or an external resource). This is proving to be incredibly difficult.
The plan I intend to use is this strategy, or creation of multiple savings accounts for each individual purchase. This will allow me to setup automatic transfers each month and accomplish what I am looking to do (though, it may require creation of 3-5 additional savings accounts).
All these savings accounts would have minimum balances of about $25 and no annual fees and through the bank I currently have nearly all finances through (with a nice web interface).
My specific question is:
- What do I need to be aware of when creating multiple savings accounts which will hold small balances?