Checking Off My Goals: Setting up Savings Accounts

This weekend I completed one of my Day Zero goals: setting up individual savings accounts.  I already have savings and checking accounts with Ally (which I love, by the way), but I wanted to have individual accounts for each of my goals so that I could track my progress.

This weekend I got on the computer and set up my accounts.  Specifically, I wanted accounts for an emergency fund, a car, and vacation.  When I start getting paid I will schedule automatic depots from my checking account to each of these accounts.

I am planning on funding the emergency fund slowly (like $100 a month slowly), contrary to the advice of most experts.  Interest rates on savings accounts are basically nothing right now, while my student loans are drawing almost 7% interest.  My employment is very stable, and I will have disability insurance in case something happens to me that prevents me from working.  Also, I know that I could rely on my parents if needed in a pinch.  Obviously, I wouldn't be excited about it, but they would be happy to help and I could pay them back over time.  Also, I am a renter.  I would feel much less comfortable with this plan if I owned a home.

I am not excited at all about the car fund.  Right now my husband and I share a car, and this has worked very well for us.  However, in a year he will begin a job that is an hour and half from mine.  We're going to move so that we can split the difference in the commute, but the move will force us to buy another car.  We have estimated how much we will need to buy a fuel-efficient used car in cash and have divided this number over 12 months to get our monthly savings requirements.

Unlike the car fund, I am very excited about the vacation fund.  I love to travel and am happy to stash away some money to satisfy my wanderlust.  Still, our vacation fund will be pretty modest.  We are planning on taking shorter, closer trips to minimize costs.  We will probably coordinate our trips with visits to see friends so that we can minimize our lodging expenses.

I'm prepared to get some flak about the emergency fund decision, but my husband and I feel comfortable with that decision for right now.  Maybe once we have purchased the car we can use the extra money in our budget to fund our emergency account more aggressively.