Several years ago, my sister told me and J that we had taught her that she could afford anything, as long as she saved up for it.
We knew she was paying us a compliment, but at the time, J and I looked at each other wondering if we needed to brush up on our social skills.
I'm now starting to appreciate what the heck she was talking about.
You may remember my previous explanation of how we have multiple savings accounts through Capital One 360 (previously ING Direct) in order to pay for various future costs. While we started with only a handful of separate accounts, we're now up to nearly twenty--each with its own specific savings goal and amount that is put away each month. We just keep on adding to that list of savings accounts.
For instance, LO is starting Sunday school at our synagogue in a few weeks, and we recieved a bill for his tuition for the first year. We were easily able to pay for the tuition, but after putting a check in the mail, my first action was to create a new savings account for Sunday school tuition, and put away 1/12 of the amount necessary for a year's tuition. That way, next year's tuition will already be funded and paid for.
Then this past weekend, J and LO and I drove down to Indianapolis to see the Moto GP races at the Indianapolis Motor Speedway. I asked J on the way down what kind of motorcycle he'd like to add to our stable in the coming years, since the vintage 1975 Honda 400 he currently owns is great for wedding photos but a little uncomfortable for super long rides.
J wasn't sure exactly what he'd like his next bike to be, but he knew that he'd like something a little more comfortable for long rides so he could have his very own Easy Rider adventure with some friends. He figured he could get one of the several bikes he's had his eye on for about $6,000 to $8,000.
I suggested we start saving for something now so that he could go on an epic motorcycling adventure for his 40th birthday (in about four years). He was thrilled with the idea, and I set up a new savings account (tentatively nicknamed "J's Midlife Crisis") while he alerted his friends to the fact that they now have plans in June 2017.
When J and I first started doing the savings account thing, it felt a little weird to see so much of our money get put into these accounts that we didn't actually touch. There were times when one or the other of us (two guesses as to which one) would freak out a little bit over the smaller balances in our checking account because that meant there was less of a cushion to handle an emergency.
But after doing this for five years, it seems like we don't have any emergencies anymore. We have the money already set aside for irregular expenses (like LO's Sunday school tuition), for big/fun purchases, and for those "life happens" kinds of moments.
For any financial issue we might encounter, we've got a savings account for that.
I'm guessing that's what my sister was talking about.
We're still going to work on our social skills, though. Just in case.