How We Save For A Spend-y Summer

Pay yourself first. It’s one of the core tenets of personal finance. Treat your savings like an obligation – your number one priority, in fact – and you can spend what’s left in your bank account guilt-free.

I’m a bit of a misfit when it comes to saving money. I don’t actually pay myself first (gasp!) but before you take away my personal finance blogging card allow me to explain how I still meet my savings goals.

Budgeting for those spend-y months

The pay yourself first, spend the rest approach sort of implies that every month is the same. Your paycheque enters your account, you set-up automatic transfers into various savings vehicles, and then spend the rest of your money on rent, groceries, gas, and whatever else life throws at you.

I don’t know about your household expenses, but ours can vary widely from month-to-month. In our biggest spending category, which I call ‘Daily Living’, we spent $1,685 last May on things like groceries, restaurants, clothing, and other miscellaneous spending. Last July, that category jumped nearly double to $3,200.

That’s why instead of letting my bank account balance dictate how much I save and spend each month, I use a 12-month spreadsheet to plot out our entire financial picture for the year.

The key to this approach is to plug your savings goals into every month and also highlight any irregular expenses that come up throughout the year (like all the food and wine we consume in July, apparently).

Don’t let an expensive summer derail your budget

That brings me to summer. For our family, it’s the best and also the most expensive two months of the year. And it’s not just the patio wines and sizzling steaks that break the budget. Summer camps for the kids, concerts, road-trips, it all adds up.

Heck, even our favourite TV show – Game of Thrones – moves to July this year, which means coughing up $40 to order HBO for two months.

Simply put, it’s easy to see how without a proper spending plan the high cost of summer can quickly derail our budget. I refuse to let that happen, so that’s why I budget meticulously to avoid dipping into our savings in July and August.

Budget for savings, too

So, although I don’t technically pay myself first I still manage to survive the expensive summer months without breaking the budget. Indeed, we’ll sock away more than one-third of our income this year.

Part of our savings includes an emergency fund because, well, stuff happens. Like when our hot-water tank stopped working the day before we left on summer vacation. That was a $350 service call I’d like to have back, thank you very much.

No doubt you can save more money faster when you earn a higher interest rate on your savings. Since EQ Bank came on the scene last year they’ve offered market-leading interest rates on an account with no fees and no minimum balance.

Currently, the EQ Bank Savings Plus Account pays 2.3 percent interest on savings deposits. And, unlike other online banks, this rate isn’t just for some deposits or only for some customers; it’s the everyday rate for all EQ Bank customers.

That’s important because for a year-round saver like me it’s nice to earn a high interest rate all the time, not just during ‘savings account promotional season’.

The nice thing about EQ Bank – besides the high everyday interest rate – is that its Savings Plus Account also comes with some chequing account functionality; offering unlimited day-to-day transactions, the ability to pay bills for free, and you also get up to five Interac e-Transfers for free each month. You can also transfer money easily (and for free) between EQ Bank accounts and to your linked accounts at other banks via electronic funds transfer (EFT).

Deposits in the EQ Bank Savings Plus Account are insured up to the applicable limits ($100,000).

I feel good about my spend-y summer knowing that I can still meet my savings goals and not have to dip into my savings account to go camping or to buy steak & beer for the weekend BBQ.

Bonus offer for Boomer & Echo readers

As a special treat for my readers to get your summer savings started, new accounts opened have the chance to win one of 10 $150 deposits into your new savings account! That’s a great way to kick-off your summer!