Open an Inconvenient Savings Account

Open an inconvenient savings account during the January Money Diet

Many of you have shared your wonderful financial goals to crush debt — once and for all — in the months and years ahead.

I don’t know about you, but there are two scenarios that seem to spell “CREDIT CALAMITY” for me:

1. Unexpected expenses

Some years ago just before a “landmark” birthday, our sewer line broke and I had to pay $7,475 that very week to to have a new line installed from our house to the street. My friends, I didn’t happen to have $7,475 sitting around — and if I had, I would have already spent it traveling to Paris for a croissant-sampling tour. I ended up putting part of the expense on a credit card and part on a line of credit, and it took me four years to pay it off.

Isn’t that a crappy way to get in debt? I think so, too.

2. Unplanned travel opportunity

European MapWhen my daughter was accepted in a foreign exchange program in Denmark, I just had to go for a visit. We took a side trip to visit friends in Spain, since we were in the same general vicinity (Spain and Denmark are close if your geography skills are anything like mine).

I don’t regret the trip at all, but I do regret that I didn’t have a funded vacation account. With no money set aside I charged that trip to my Visa, even though I hadn’t finished paying off the **sparkling new** sewer line yet. That eventually led me to have $12,000 debt spread over four accounts — and too many sleepless nights to count.

The Solution

For me, the way out of my mess was this:  I opened three savings accounts at my credit union.

Account #1 – Emergency account

Account #2 – Vacation account

Account #3 – Freedom account – where I stash a set amount of money each month for large annual expenses like insurance, taxes and HOA fees.

Why It Works for Me

This credit union is not connected to my regular bank, and I don’t have a checking account there. If I want to withdraw money, I have to drive over there and talk with a human to get it.

This is an important key for me! While my regular bank offers a savings account connected to my checking account, it’s too convenient to transfer the funds electronically and therefore the money never really accumulates. Having an inconvenient savings account makes it tougher to get the money out, and I need that.

Some may argue that savings accounts pay pitifully small interest rates, and while this is true it doesn’t matter much if you’re just saving a few thousand dollars for short-term use. As your balance grows, you can transfer the money away to another inconvenient place that pays a higher interest rate.

Safe and Sound

The credit union’s interest rates are a little better than the bank’s, but the real appeal for me is that the account is FDIC-insured and the principal is not affected by the economy or market fluctuations.

The credit union doesn’t charge monthly fees, and the nice folks there will happily open as many savings accounts as I like with a $25 minimum balance.

Both of my children have learned about saving money with their credit union accounts, and the credit union gave my daughter her first car loan when she was 16.

I wouldn’t invest my IRA or long-term college savings here, but for simple, short-term saving I’m a big fan of the credit union.

Make It Automatic

When I worked for the publishing company, I arranged to have a set amount withdrawn from each paycheck and sent directly to a savings account. If your company offers this benefit, I highly recommend it as a painless way to build real wealth. If it seems impossible, start with a small amount. You’ll love seeing that balance grow, and with time you’ll be able to increase the amount.

I started having just $25 withdrawn from each bimonthly paycheck, which added up to $600 a year. I eventually eased that up to $50 a paycheck after my next raise, and then $100, until eventually I was having $200 a check sent to my savings account. The funny thing is, I really didn’t miss the money — as long as it didn’t have a chance to pass through my fingers.

Now that I’m self-employed, I budget for savings each month and pay the amount just like a bill. It takes a little more self discipline, so having an inconvenient place to stash the savings really helps.

How About You?

Your challenge in the remaining month, if you choose to accept it, is to open a savings account in a place where you can’t easily transfer the money to your checking account. If you’re interested in joining a credit union, you can learn more and find one at

Chocolate chip cookie recipe at Happy Simple Living blog

You may need these.

If you work for a company that offers automatic savings withdrawal, I double-dog dare you to set up a reasonable monthly deduction. You may have to sweet-talk someone in your company’s payroll department to set this up for you, which is what I did. Chocolate chip cookies can work wonders in cases like this.

If you already have an inconvenient savings account, or another system for managing unplanned expenses, we’d all LOVE to hear your thoughts.


The signature for Eliza Cross

P.S. You could win a deluxe Happy Simple Living gift box by participating in the January Money Diet. The box includes a $25 Barnes & Noble gift card, $25 cash, pantry staples like bean soup mix and organic quinoa, signed copies of three of my cookbooks, homesteading supplies like soap, candles and eco-friendly cleaning supplies, and much more.

At the end of January I’ll choose one winner from among everyone who comments — someone who has participated in this 31-day challenge with heart and soul, and achieved good results. Good luck!

Photo:  Gravityx9

About Eliza Cross

Eliza Cross is a full-time writer and the author of a dozen books about food and home design. She has been blogging about simplicity and sustainable living since 2006.

Open an Inconvenient Savings Account

  • Tricia

    I did this a few years ago. We have a money market acct at a Credit Union that is not very convenient. This type of acct limits the number of withdrawals per month, and with no checks or atm/debit card, I force myself to have to go into the branch. I also have other savings acts that are for specific things and I put money in each every month. It takes a bit more to manage, but is well worth it for me.

  • Laura

    This is an excellent idea. We do have a separate savings account in another bank, but if I’m honest, I can easily get into it if I need to. But we are pretty good about just leaving it alone since we don’t primarily bank with this company. I’ll have to consider this idea!

  • Catherine Godfrey

    I do this already. I had to make the savings bank be so inconvenient for non-spending reasons. Pretty bad I can’t control myself,but this works great.

  • Lisa F

    We do something similar. When we opened our checking account, the banker said we would have zero monthly fees if we also opened an automatic withdrawal savings account. We opened two! Every month, we have money automatically moved to a Christmas savings account and to an emergency home expense account. Occasionally we add extra deposits to these accounts. Best decision ever!

  • Lisa Morowski

    I have been using this concept for years, but within my own checking account. I “withdraw” money from my checkbook, and “deposit” it on a ledger page. The ledger page has different columns: Insurance (health care deductible, car, home, life etc), Christmas, fund, emergency and vacation. I have a set amount that I put in the insurance and Christmas funds at the beginning of each month. Then at the end of the month, whatever is left over in my budget goes in the emergency and vacation funds. This has been a real life saver, though I do have to remember to add that money in when I balance my checkbook each month. As for property taxes, whatever we get on our income tax return goes into the money market for property taxes. Hopefully it is enough and if not, we add to it monthly as well.

  • Lynn Louise

    I have a “regular” savings account at my credit union and then another online acct which I never touch. I just opened it not too long ago but I like that it is online making it seem “different” than my regular acct. It is untouchable. I try to watch where my money is going and how much I am saving. Just being mindful of the saving and spending is the main thing.

  • Karin

    We have 2 different savings accounts connected to our checking account with our credit union. I thought that I could stash money in a savings account and not touch it but I was wrong.

    Having a savings account with a different bank is a good idea.

  • You know, this sort of spending has never really been a problem for me. I had a “scared straight” experience when I was young that forever made me equate security with money in the bank.

    I too was an exchange student (in Norway) and the arrangement with my parents was that they’d pay for the cost of the program (including air fare) and I had to provide the spending money. So I saved all of my after school job money and opened an account in Norway, but the money didn’t go nearly as far as I thought it would, and half way through the year I started running out. My relationship with my parents being what it was, I couldn’t ask them for money, so I just stopped spending – which pretty much meant I stopped eating lunch!

    Anyhow, after that experience I never felt safe unless I had a hefty chunk in the bank.

  • Sue Coletta

    We use a credit union for our regular direct deposit and just love it. Our branch only has a $5.00 opening balance amount, which is great when you need to scrape the bottom of the barrel.

    These are great tips, Eliza! As always, you are so on top of things. I will take this challenge with you. I just need to find one farther away so I don’t have easy access. Thanks for another excellent idea!

  • Cindy

    I have a somewhat inconvenient savings account. It’s with a virtual bank. While I can transfer money from it to my checking account, in my mind, it’s completely off limits, except for planned purchases, like a car or a vacation. I have a set amount of money automatically sent to the account each month and add extra whenever I can.

  • My Credit Union is paying the highest % around right now and I’m loving that. The Credit Union is not in a convenient location so I have direct deposit into my account and pay my monthly bills online. I keep $20 in my wallet and get the cash from the grocery store when I’m out. Because of the interest being paid I don’t keep separate accounts anymore but think that a Christmas, start of school, and vacation accounts should be part of every family’s planning. I also like the Dave Ramsey plan of have the different savings accounts. It is so easy to set up a direct deposit to a savings account and keeping it at an inconvenient location or even locations without ATMs sure helps keep the savings in the bank.

  • Bethany

    I keep 2 savings accounts – one for grad school and one for emergencies. I have money automatically deducted from each paycheck to go into both accounts. I only just started doing this, but it’s already made a huge difference in my monthly savings!

  • SanDandy

    I never thought about opening a savings account in another bank. Making the money harder to get to is a wonderful idea.

  • Jennifer

    I work on commission base and have my admin deduct $200 a check to hold in a company escrow account for me. If I sell five houses a month, that’s $1000 but $0 if I don’t do any so it is a nice motivator. I have had to dip into it once for an emergency which was nice to have but I have to have a check cut if I want to pull any out so it isn’t too accessible for me 🙂 The best part is that I don’t see it on my check so I don’t even miss it!

  • Joyce

    I did this 30 years ago. We had bought a house and needed money for the quarterly property taxes. I figured out how much a paycheck I would need to deposit and set up a direct deposit in a credit union. No ATM card(I don’t think there were ATMs then lol). When my children entered catholic school, I did the same with their “Bishop Ludden” money. Now that they have all graduated, the Bishop Ludden money still goes there creating a nice account.

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