In my mind, making an effort to save is only half the battle.  An equally important skill is the ability to identify your saving objectives.  Rather than having one lump-sum savings account, I believe we should keep our money in different places for separate purposes.  Just as all long-term goals need short-term benchmarks to measure our progress, our savings need some direction and discipline. 

When you stop and think about it, there are many different places where your future savings could be put to good use: a computer, a car, college, vacations, a down payment on a house, retirement, etc.  Maybe it’s because I’m so obsessed with my financial organization, but I’d rather have separate accounts for each of these large future purchases versus one all-encompassing account.  This way, I can easily set aside enough money for these different purposes and timeframes.  Also, I can avoid spending too much on one purchase.  I’m not going to pull money from my college tuition account to my pay for a new computer, whereas with one large account this could easily happen.  I can feel content knowing that my money is safe in each account and won’t be used for anything other than its intended purpose. 

Stashing money away is a good first step, but it’s only as effective as our discipline in leaving it there.  The ultimate way to limit your future wealth is to allow yourself to dip into savings.  It’s a slippery slope once you begin compromising your savings efforts.  We should do everything in our power to completely separate our savings from our normal spending money.  I like to consider my savings and investments untouchable; if my checking account is running on empty, I consider myself broke.  I don’t bail myself out with a savings withdrawal. 

By identifying our savings goals and exerting some self-control over our money, we can easily achieve our financial objectives.