How to set up savings “buckets”

Dear Liz: You’ve written about how helpful it can be to have “savings buckets” or separate savings accounts earmarked for different goals such as vacations, property tax payments and so on. I have been trying to do this myself, but every bank I find charges so much in fees that it would cost more money than I would save. Either that, or they tie the savings accounts to a “free” checking account that has a high minimum balance. Can you please pass along any information about free savings accounts that have no minimum balance? I cannot use Internet banks because I cannot deposit cash when I have $5 or $10 in my pocket that I would take to the bank.

Answer: Actually, you can. Internet banks can be linked to your checking account at a brick-and-mortar bank. You can take your money to the bank, then transfer it to one of your savings accounts at the Internet bank. Unlike traditional banks, Internet banks such as ING Direct, Ally and FNBO don’t have balance minimums or monthly fees. You can set up several savings accounts without paying extra fees.

You still need a low-cost checking account, of course. You should be able to find one at a local credit union.


  1. My credit union allows me to have many savings accounts. I have standard savings, checking, debit savings, car savings, emergency fund, vacation fund, and Christmas account.

  2. Also you could put it all in one account and then do a spreadsheet to keep track of what amount goes to what category. This is what I do.

    • That’s a good suggestion, Pegg, although my experience is that many people are allergic to Excel…unfortunately. A spreadsheet can be a great tool.

  3. I use ING and currently have 6 different savings accounts that cost me nothing extra and its a FANTASTIC tool for saving towards goals. At a glace I can quickly determine how close I am to each goal AND how much in liquid assets I have at any given time.

    • I don’t know if you’ve experienced this, Laura, but sometimes I’m surprised at how fast even small transfers accumulate in those different savings accounts/buckets. It’s so nice to have the cash saved up for a goal before you spend it.