The secret to achieving your savings goal and why I have a two savings account

I’ve always been a good saver. Ever since I was a child, I would have a lot of P5 coins stashed in my bags. I’ve had series of piggy banks growing up, and I always managed to have cash in my wallet. I was a scholar in high school, and my expenses in college were extremely low, like literally P5000 for the whole year, sometimes none because I got free tuition due to being included in the Dean’s List.

When I started working on my first year of college, that’s when my savings grew faster. But then, I never seemed to achieve my goal. Until I found out this secret:

THE SECRET: You need a separate savings account for your savings!

If you still have your savings merged with your primary bank account / card, then you need to open another account (on the same bank, to make transfer easier) right now! Go on, come back when you just did. Even if you are just a student, create a separate one from that where you receive your allowance.

Now, welcome to the club!

I’ve separated my expenses and savings account for almost a year now and here’s what I found out:

Advantages

1. Whenever my salary comes, I immediately transfer my savings portion to my separate account, and it feels as if I’ve only got little left to spend.
2. Next, I withdraw funds I need for bills from my primary account, and I’ll know immediately how much more I can spend or splurge on. Because my savings was already removed from my bank account, when I look at my balance, and I see that I only got little left for the month, I won’t feel like I still have available funds for the month. And because I have my separate account in a passbook, it is difficult to withdraw funds from my savings!
3. It allowed me to save faster!

Disadvantages

In times of emergencies, it would be difficult to immediately access  your account, especially if you only have a passbook.

Now, why do we even have to save?

1. We have to save because it is the foundation for our financial freedom.
2. We need to have enough savings to serve as our emergency fund should we decide to change career, or should we face a difficult phase in our lives like losing a loved one.
3. We need to save so that we can purchase life and health policies so that we don’t become a burden to our families, and so that IF we leave this life early, our children will be able to finish their studies. Or if you already have a mortgage, your partner won’t be carrying the burden alone.
4. We need to save so that when a wonderful opportunity comes, like a really great deal, you will be able to grab it!
5. We need to save so that we can start investing and build our wealth.

Even if you can only save and transfer 10% of your income to your savings account, at least you’ve already started. You need to start today! I repeat, open that account and start today!