"We've got over twelve and a half grand in savings," Tyler said Tuesday at supper, and turned his phone around so I could see a used riding mower on Facebook Marketplace. $1,100, barely used, over in Bevier. He's mowing six yards this summer with a push mower, and I understand the appeal of sitting down for it.
He wasn't wrong about the number, either. Our one savings account at the bank in town said $12,689.07. But that wasn't twelve and a half grand of anything. It was $3,000 we keep for emergencies and $9,689.07 that's supposed to become a down payment. The bank just didn't know the difference.
That conversation is why, this morning, we finally opened a second savings account.
The problem with one pile
For years we kept everything in one savings account and tracked the split in the sheet, the shared spreadsheet I run our budget from. In the sheet, the emergency money and the house money had their own rows. In real life, we'd open the bank's app and see one big number.
One big number makes everything look affordable. A mower looks affordable. A weekend in Branson looks affordable. A new couch, which I'll admit I've stared at more than once, looks affordable. Nobody plans to raid the house fund. You just see $12,689.07 and your brain stops doing subtraction.
It also works the other way. If the truck broke down tomorrow and we pulled $1,500 out of that one account, I'd have to stop and figure out which pile it came from. And I know us. We'd tell ourselves we'd sort it out later, and later has a way of not happening.
What we set up
The bank in town is open until noon on Saturdays, and they opened the second account in about 15 minutes. No fee, no minimum balance. I moved $9,689.07 into it and left $3,000 where it was. Then I gave them nicknames so there's no confusion: one is "Truck and Dog," and the other is "House."
Here's how much goes to each, and the rules we agreed on.
- The emergency fund stays at $3,000. It's full, so nothing new goes into it right now.
- Everything else goes to the house: the transfer on the 21st, which carries my old $289 car payment plus the $58 we save on phones and the $45 from packing Tyler's lunches, $392 in all; whatever's left in checking at the end of the month; Tyler's mowing money on Sunday nights; and whatever comes out of the jar.
- If we ever spend from the emergency fund, refilling it comes first. The transfer on the 21st gets pointed at "Truck and Dog" until it's back to $3,000, and then it goes back to the house.
- Only "Truck and Dog" is set up for quick transfers to checking. "House" has no debit card and takes a little effort to touch, which is the point.
In June, that worked out to $1,112 for the house and nothing for the emergency fund, which is exactly how it should look in a month when nothing breaks.
Why $3,000
When I add up a bare-bones month, the bills that don't go away no matter what (rent, electric, water, internet, phones, groceries, gas, insurance and my student loan), it comes to about $2,200 in the summer. $3,000 covers that with some room to spare.
More importantly, it covers the kinds of bad days we've actually had. A big repair on Tyler's 2015 Silverado. An unplanned vet visit for a 70-pound hound who eats things he shouldn't. A medical bill. A short paycheck if one of us is out sick for a week. Those are emergencies, and that's what "Truck and Dog" is for.
A riding mower is not an emergency. Neither is Christmas, a camping trip or a couch, no matter how nice the couch is. Those get planned and saved for out of our monthly budget, or out of the mowing money in the mower's case.
Could $3,000 be too little? Maybe, for some households. If one of us lost a job, it wouldn't last long. But we both have steady work, the truck and the CR-V are paid off, and every extra dollar we put into the emergency fund is a dollar that isn't going toward getting out of a rental. For where we are right now, $3,000 feels right. If that changes, the rules can change too.
Once I put it as "you're asking to spend house money on a mower," Tyler looked at the number again and said, "Let me think on it." Anyone who knows him knows what that means. This time it was his own idea he was saying no to. If the mowing business wants a riding mower someday, we'll say so out loud and save for it on purpose. That's a different pile, and now we actually have piles.
Both accounts still earn almost nothing at the bank in town, by the way. That's my next project.
