How to keep your hands off your emergency savings

How to keep your hands off your emergency savingsHow to keep your hands off your emergency savingsAnemergency fundis one of the most important financial accounts you can have. It is there for you during the worst times in your life. It protects you from things like eviction, default, or bankruptcy. It has your back if you lose your job, end a relationship, or get sick or injured. If you havent yet started to build your emergency fund, you should start today.Follow Ladders on FlipboardFollow Ladders magazines on Flipboard covering Happiness, Productivity, Job Satisfaction, Neuroscience, and moraEven if youre only putting $10 a month into it, thats better than nothing, and itll grow faster than you think. But as youre able to contribute more, you should increase your contribution until youre able to fully fund it. You should have at least three to six months worth of expenses in this fund for it to be fully funded.However, its one thing to build your emergency fund, and its another thi ng to leave it alone. The point of an emergency fund is to use it for emergencies. If you use it for other things, like vacation or shopping, youll run out of money and it wont be there when you actually need it.Put Your Savings In a Separate BankIts always important to know and understand yourself and your habits, but its especially true when it comes to money. If you know that you tend to transfer your savings into your checking when youre running low on money, you have to put some barriers into place.I recommend using high-yield zugnglich savings account for this. Not only will it be separate from your checking account, but youll earn more money on it too Most brick and mortar banks have less than a percentage in interest on savings accounts, but online banks are currently offering more than two percent interest Depending on how much you have in your emergency fund, that can be a lot of money over the course of a year.There are lots of online banks out there now, but check outAll y,Synchrony,Barclays, orAmerican Express.Automate Your SavingsThe key to most things related to money is to automate. Thats why auto pay exists It takes forgetfulness out of the equation. It also takes human nature out of the equation. As humans, we love instant gratification, and spending money feels better immediately than saving money does. If the money moves automatically from your paycheck into your savings account, you wont be able to spend it before saving it. Set up direct deposit with your employer, or have your bank move the money for you whenever a check hits your account.Nickname Your Savings AccountsDid you know that in most online banking platforms, you can rename your accounts? My current savings accounts (both individual and joint) are named thusly Emergency Fund, Fun Spending, Annual Expenses, Home Improvement, Dog Savings, Travel Savings, and Airbnb Taxes. Yes, I may have more savings accounts than you would like to have, and thats okay I just like to keep all my s avings goals separate so that I can easily track them. It also makes me feel more prepared and comfortable to see that Im saving for all of the things that are important to me.Nicknaming your savings accounts can also remind you what theyre for if youre tempted to withdraw from them. If you name your emergency fund your freedom fund or fuck off fund, maybe youll be less likely to spend the money on non-emergencies.Create Savings Accounts for Other GoalsIts easy to dip into your emergency savings if youre keeping it in the same account as savings for other things like travel or fun. Its important to separate your emergency savings from all of your other money. That way, youll always know what its there for and wont be tempted to dip into it if youre pulling out money for another reason.Have you built up your emergency savings yet?This article first appeared on Maggie Germano.You might also enjoyNew neuroscience reveals 4 rituals that will make you happyStrangers know your social clas s in the first seven words you say, study finds10 lessons from jngste Franklins daily schedule that will double your productivityThe worst mistakes you can make in an interview, according to 12 CEOs10 habits of mentally strong people