Last updated August 18, 2021
Tracking savings might sound like a mundane activity. You’re thinking, why can’t I just check my savings account online and call it good?
Or maybe your head is spinning over how many separate savings accounts you need to handle all the different categories of things you want to save for, short and long term.
Here you will find why you need a simple, single money saving tracker for… drumroll… one total savings account. And I’ll explain how to do it and even give you the spreadsheet I use!
What's In This Post
Why tracking savings (and tracking forward) makes a difference
Tracking your savings account in a spreadsheet (Excel or Google sheets) provides not only a record of savings transactions (ok, kinda boring), but a place to line item the future transactions required for turning dreams into reality (exciting!). It’s taking a wish and creating the line items that make it into a plan, instead.
The main point of saving money
Everyone knows they should save money. But why? Without a strong ‘why’ it’s easy to make putting money in savings just about the lowest priority job for your money when things are tight, like the whipped cream on top of the sundae – optional. But the role your savings dollars play in your big picture money management is crucial, for both the mundane money management stuff & the changing your life stuff. Therefore, outlining your specific savings plans is imperative to enable growth towards financial freedom.
A basic money saving tracker spreadsheet makes it a cinch
The logistics I use for tracking savings accounts in my spreadsheet is dead simple. It is identical to using my checking account tracker sheet, but the purpose is quite different. When tracking savings, there are very few transactions compared to your checking account which is handling all the monthly bills. It’s much more about setting out what’s coming ahead (for a year and more) to see how it fits into your financial picture. (The free spreadsheet template you can download below has examples & templates for both your checking & savings account)
I use the same “Completed” and “Planned” columns, which you can see as a quick example in this Google sheets link. Here’s just a quick screenshot:
If you copy the example from the Google sheets link to your own new Google sheet, you can drag and drop the dollar totals from the Planned/Goal column into the Completed column to simulate how the account balance will change as time passes. (*Note: if you want to paste into your own Excel spreadsheet, the formula that automatically adds up the available balance in the Completed column will not paste over, nor the column widths- if you’re not sure how to fix those things, just download my (free!) Excel spreadsheet using the email form below and check out the Savings tab to get started)
Note, if you look at the link to see the full sheet, this example is for someone starting the new year with only $50, and banking over $5,000 by the end of the third quarter (Sept). And with taking a $2,000 family vacation in the summer. Not too shabby for getting started.
That’s how you track ahead, or simulate, your financial big picture for the entire year ahead. It’s very easy in a spreadsheet with the specific goals and expenses built in.
Tracking forward builds in irregular expenses
By tracking savings, you’re capturing all the irregular income that’s not included in calculating your monthly cash flow numbers and committing that to the savings account. You also account for the irregular expenses and big plans that aren’t part of your usual monthly bills (more on that below).
You just line item that stuff out, achieve a monthly savings rate that supports your plan, and you’ll have all your irregular expenses waiting and ready to go out to the checking account to pay for those expenses. No more surprises and blown budget.
Tracking forward regulates new spending choices
When you suddenly get inspired to replace all your floors with hardwood, you go to your spreadsheet for tracking savings to play out that scenario… hmm, let’s see how many dollars of beautiful floors I can afford. And in doing so, you unavoidably revisit the other priorities already line itemed in there.
Hmmm, now I remember why we haven’t replaced our floors yet. I’d rather retire from the 9-5, move to the country, and build streams of income for which I am my own boss. Oh, and we gotta pay those personal property taxes this fall, that project at the rental is happening this year, and we promised the kids a trip to Disney. Thank you, spreadsheet. My current floors are looking much better now!
Alternatively, you may decide the floors better align with your spending values than a trip to Disney, so you can adjust the priority in your spreadsheet as life evolves. It’s all in one place so it’s easy to stay flexible.
You may have financial goals like affording childcare you feel awesome about while you build your dream career, or buying your first house with 20% down, or traveling the world. Whatever your goals may be, give it a cost estimate and it’s all there in your friendly savings tracker, all in one place.
A note on printable trackers and sinking funds
I’m going to describe my approach to a three layered savings account below. But before I do, let me just take a quick tangent.
I have one savings account.
And I have one spreadsheet for tracking and planning our savings.
The risk with separate savings funds
There are a lot of cute visual printable savings goal trackers out there. Usually these are for separate, specific goals like vacation fund, car fund, Christmas shopping fund, etc.
And there’s a lot of talk about separate “sinking funds” as well. These are just a fancier way of divvying up separate savings goals into increments over time. Often it is recommended to have separate savings accounts for these funds as well. Honestly, for me, it feels way more complicated than necessary. I’ve used my simple spreadsheet for 10+ years for tracking savings and allocating to various needs.
But I also believe this divvyed up approach puts you at risk of losing sight of the big picture of your money.
Example
Perhaps you have $500 in a Christmas account, $1,000 in a home improvement account, $2,000 in a travel account, plus $750 in a miscellaneous account. Elsewhere, you have an emergency fund with $5,000. Looks super organized.
But let’s say you decide to put in new floors- you have a child with asthma and the doc recommends removing carpet from their bedroom. One thing leads to another, and you’re looking at new flooring potentially for your entire bedroom level. Depending on the choices you make for this project, it will cost anywhere from $2,000 to $10,000. That’s considerably more than the $1,000 in your home improvement account. But there’s a health issue here, so it’s different than just having a prettier bathroom or something like that. So what do you do?
In reality, you have $9,250 in current savings. You need the $5K ready for emergencies. The family desires to take a trip sometime in the future. You’re planning to buy Christmas presents in some certain number of months. And so on. Each of these goals has a timeline, some more modifiable (i.e. travel) and some less so (i.e. Christmas). Some are just TBD- like the miscellaneous fund and the emergency fund. These different categories don’t carry equal weight in terms of priority and timeline.
So instead of these different savings funds/categories, which treats them as equal in priority and timeline, I’d rather look at the total $9,250 and prioritize how to spend on what and when down the lines of time in my spreadsheet.
If I spent $3,000 on the flooring project now, and maintain a monthly savings rate of $250 I will recover that whole amount in one year. Meanwhile, I would still have over $1,000 to work with (while protecting my $5K emergency fund) to manage Christmas, the date of which I can’t move.
But if I decided the flooring was a more specific and immediate goal than family travel plans, I’m ok with pushing travel to 9-12 months down the road with this plan.
Or perhaps you aren’t ok with delaying travel! So you scale down the scope of the flooring project. Or perhaps in the face of a pandemic (ahem), you don’t plan on traveling for a couple years anyway, so you could scale up the flooring project. Basically, you study your savings needs across time and prioritize how much you will spend when out of the total useable amount. And by useable amount I mean out of the portion above your emergency fund threshold.
If all that math reading makes your head spin, don’t worry. My signature savings course demonstrates this principle clearly and lays out the whole bigger picture strategy. Check out the Save Money Like You Mean It Strategy Bundle right here.
Visual printable trackers
I think the printable, color-in trackers can be a fun visual reminder of particular goals you want motivation for, so if that’s your jam, go for it for the fun/motivation factor. Visuals can be very powerful!
But a word of caution- when used alone, I think they are way too limiting & inflexible. You could have a stack of those different goals and completely lose track of how you want to prioritize money towards one vs. the other, how changes in one area affects another, how to plan money over time, etc.
Also, keep in mind that big dreams are usually more complicated than setting aside a tidy sum for family vacation. I would have to remake my printable goal tracker each time the dollar amount total for my more complex goals required changes (wait, you say raw land purchasing requires a minimum of 20% down? I need how many thousands now? Dang it). Big dreams are just not as simple. Having a planning method that is fluid can be very helpful and powerful.
In balance, I did create one of these cute trackers for savings you can download, but it is for each of the three layers of savings together on one page, not separate trackers for separate funds. Check it out if visuals help motivate you more than my boring spreadsheet. 😉
OK, tangent over.
Three layered savings account: tracking savings goals all in one place
Now I’ll tell you how I handle all these things together, from biannual tax payments to car repairs to vacations, using a three layered concept for the savings account. All these needs fit into one account, because you maintain a minimum savings account balance that is your emergency fund (#1), line item out estimates for the irregular expenses for the year ahead (#2), and everything you save over and above that is fueling your big picture stuff (#3). Let’s take the three layers one by one.
Layer #1: Your emergency fund amount is your minimum acceptable savings account balance.
The most obvious purpose of saving money is “for emergencies.” Let’s break that down. This could mean loss of income (from layoff, illness, injury, etc). It also includes unexpected expenses: major home repair (e.g. furnace failure), major car repair, plane tickets for unexpected trip (e.g. death, illness), healthcare costs beyond insurance coverage. The list of what-ifs can go on pretty long. It’s relatively easy to think these things ‘won’t [or probably won’t] to happen to me,’ but also easy to realize you should have some money around, for when one happens here or there.
Another form of emergency I will note here is general unplanned overspending (whoops) in your day to day life. Erratic spending is especially probable when you are a young family. You say a $60 magic sleep sack will help my baby sleeeeeeep? Excellent, paying for priority shipping too! You might need to float some money over from savings to pay your credit cards in full for that month (because paying interest is not an option!). You will then have to repay your savings back at the next cycle of bills or ASAP.
My emergency fund perspective
Personally, I viewed this bucket as $10-15,000 when we were both working traditional jobs full time. Gasp! I know, people just starting out on mastering their financial journey are like, I’ll never have $15K in the bank just sitting there, you’re nuts!
And meanwhile, the personal finance gurus are like, you said in another post your mortgage payment is $2,500 per month for P&I alone. Combined with other fixed expenses, there’s no way your emergency fund should be less than $30-45,000, you’re nuts!
To the former group, I say “You’ll get there!” and to the latter, I say “I have my reasons & my life isn’t a cookie cutter.” Can’t win ’em all right?
But what if a bunch of stuff happens all at once? Or something catastrophic happens?
First off, if something catastrophic happens I will have much tougher problems on my hands than maintaining my neato three layered saving account. I will use what I need in my total savings without letting it get below my emergency threshold (10-15K). Never clean yourself out of liquid cash in case something else happens.
Insurance
In the case of disability and death, that’s where insurance comes in. Disability insurance policies and term life insurance policies can be affordable and protect you against financial catastrophe when something truly catastrophic happens. If you have bare bones health insurance, you may also need to keep more money for health expenses around compared to having a more comprehensive health plan. They key is to buy these policies as early as possible- when you are youngest and healthiest!
Assets
I could also then tap into assets like investment accounts (not our primary retirement accounts, though), a home equity line of credit, or even sell or refinance our rental property if absolutely necessary. This is where your ‘net worth’ comes in (I hate that term though- as if money defines anything about our worth…). Again, if you’re swimming in more debt than assets right now, you’ll get there! You need to prioritize more cash for emergencies in this case.
Strategic use of interest free debt
But before that, I would implement strategic use of debt. This is one reason why having fantastic credit is important. In a pinch or for strategic reasons, you can put groceries and gas on an 18-month 0% interest credit card for a few months. Or put a big emergency expense onto one, and pay it off over the following months within the 0% intro term. You’ve effectively created an interest free monthly payment plan (or sinking fund!), just after the fact. Even when I do have the cash in savings, I’ve done the credit card thing just to avoid touching savings on a $10,000 HVAC replacement.
Like I said, for us, the emergency fund has typically been a minimum of $10-15,000 that we won’t let the savings account ever go below (recently we set that min at $30K for me to leave my career and start a business from scratch). That’s the danger zone. But we also have (had) very stable jobs and multiple assets. Though remember, it wasn’t always that way! We also have solid insurance coverage. Evaluate your own situation and determine the right amount for you. For example, we moved that minimum bar for the emergency fund up to 30K before I was free to leave my 9-5 job.
Ultimately, it’s impossible to know the future. So prepare well, albeit imperfectly, and have multiple ways to roll with the punches.
Layer #2: Irregular expenses are estimated line item withdrawals planned for the year ahead
This second category are the things you should see coming but people usually don’t.
Car maintenance is not the same as ’emergency breakdowns.’ Expect maintenance annually if you own a car, more or less depending on its age. Think tires, brakes, etc for each vehicle you own.
For us, flights for a family of four is one of these. We know we will fly to visit family at least once a year so it’s an uncommon, but predictable cost.
Other expenses to anticipate might be Christmas gift season, maternity leave coverage if your employer doesn’t provide this paid, other unpaid time off you plan to take, non-urgent but predictable and necessary home maintenance costs from painting to windows to roof replacement, the list goes on. If you wanted to have a particular amount built up for debt payoff by a certain date, you could build that in here too (in addition to your usual monthly debt payments).
For example, we recently spent $14,000 at our rental property, but it was in this second savings layer- it had been planned for. So, while it sucked to spend that much money (because it was for massive dead tree removal work, not something fun like a shiny new kitchen), we didn’t “feel it” at all because it had been a line item in my spreadsheet for tracking savings for years (trees die slowly, thankfully).
This list is more personal and requires some reflection about your life stage and circ*mstances- do you have kids with needs ahead (i.e. orthodontics), or have family living around the globe with expensive travel, friends with weddings in the coming months/years for which you’ll need an outfit/gift/travel, own a home/car that must be maintained? Do you own rental property?
Seeing these things coming and building them in will seriously raise your game when it comes to mastering your finances. It takes such onslaughts of big expenses from something that tears down your bank account seemingly constantly, to just another piece of the puzzle you’re prepared to respond to. There are other tips and tricks for absorbing costs like these, but the first-line should be having that money set aside in savings.
You don’t need these all in separate funds. You just need line items estimating them so they’re part of your savings cash flow picture over the year ahead.
Get more info on how to quickly brainstorm your “Layer 2” needs in my signature savings course. Check out the Save Money Like You Mean It Strategy Bundle right here.
Layer #3: Big picture savings goals are estimated & become specific line items when the time arrives
The third and final tier, the foundation and depths of your savings, is the relatively untouched money that fuels your long term goals in life. You want to buy a house? Retire early? Start a business? Get a long sought after bike, guitar, horse, car etc etc etc….? You must have the two categories of money above (cash for true emergencies, anticipated big ticket items) planned in order to develop and protect this crucial base for making money work for you as a tool to live your best life.
Take real action by putting some estimates in your spreadsheet so you can see what you’re working towards. You’re training yourself to stop wishing and start planning.
Depending how long term a goal, you may revise your estimates many times. And as you get the funds (your balance grows by that much, over and above your emergency fund minimum), you can start putting specific items and amounts in as your actual planned expenses.
For example, you may want a down payment for a house, so you put a future line down at the bottom of your list for $25,000. Over time, you keep pouring money in savings using every savings strategy you can, you drag and drop that “-25,000” cell into the “Completed” column to simulate where you’d be if you bought a house today, along with all this year’s other planned expenses…. and eventually your savings account can accommodate it. You drop your $25K withdrawal in there, your balance drops to a total above your emergency fund threshold. All the irregular expenses for the year ahead are accounted for as well. You’re there!
Once you start home shopping, dollar crunching with your monthly cash flow numbers to get a mortgage target set, and researching more, you decide your down payment will be $20,000 and will be needed by summer of next year – now you have a specific line item with a time in mind. Once you are under contract, you’ll have pulled your earnest money out of this sum and have a specific final dollar amount for closing with a date. So your dream estimated fund evolves into a very specific line item with a date. Those house buying dreams become specific dollar plans. Make sense?
Turning dreams into reality. Success!
Key takeaways for tracking savings
Your savings account is a place to stash cash for unknowns, plan out withdrawals for short term expenses (even if they are estimates), and block out some chunks of change you want to build towards for big life stuff. Your money saving tracker spreadsheet lists this all in one place, and using just one savings account. You can forecast ahead, accounting a year in advance for all those those planned and unplanned expenses and keeping your set minimum amount for those true emergencies.
Want to buy a pony by next year? Just use the forecasting technique of dragging and dropping planned amounts into the column for completed transactions in the savings spreadsheet. This shows you your future balance if you were to take all those actions you line itemed out. You can then adjust your savings rate through increasing your income and decreasing your expenses to achieve that goal over time. Reassess and revisit often. It’s that simple.
Now it’s time to brainstorm that personalized list of possible emergencies that can affect your money, the anticipated expenditures for the year ahead, as well as the big picture dreams and plans you want to work towards.
Take my signature savings course & get custom coaching feedback with the Save Money Like You Mean It Strategy Bundle right here.
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