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Personal savings — plus God's special provision

At Sound Mind Investing, we eat a lot of our own cooking. In other words, we actually do the things that we suggest to our readers!

Case in point: I wrote a piece a few months ago on the wisdom of having multiple savings accounts, with each account each earmarked for a specific purpose.

Here's a snippet from that article (subscribers' link), which appeared in the June issue of the SMI newsletter:

If all of us kept excellent records...there wouldn't be any need for [multiple,] dedicated accounts. You would know, for example, that $356 in your general savings account is earmarked for new curtains and $1,442 is for getting your driveway fixed.

But human nature being what it is, our record-keeping is sometimes haphazard and our "mental accounting" can get fuzzy. "How much of this money is for the next tuition bill and how much is for a new washer/dryer?"

So in the real world, a dedicated savings account is helpful. Indeed, multiple accounts — each with its own targeted purpose — can be even better....

At first, this sounds like a paperwork headache — and not too many years ago it would have been. But in these days of online savings accounts that link to your checking account, setting up multiple accumulation funds is a relatively simple matter. Furthermore, money can be transferred to each targeted fund (from your checking account) at pre-scheduled times.

Around the time I was working on that article, I had a problem with my heating and air conditioning system. Thankfully, the repair turned out to be minor, but the repair guy (who is also a friend) said something like, "Systems like this are usually good for about 15 years. How old is your house?"

"Uh, 15 years," I said, realizing the implication.

I priced what it would cost to replace the heating/cooling system, and a few days later set up a dedicated savings account. For the past six months or so, my wife and I have been diligently putting away money for the day when the HVAC system finally went ker-plunk.

Last week, it happened. Sure, I wish we had been able to save for another year before the system died, but I'm grateful we had a six-month head start. As it turned out, the money we had saved in our "heating/cooling fund" plus the $1,500 tax credit available (through Dec. 31) for energy upgrades brought us to about more than half the cost of replacement.

I had to dip into other savings to pay the rest of the amount, but guess what? Literally moments before I sat down to write the check, my eldest son sent me an online message: he had just been awarded a scholarship for his overseas study next year!

Remarkably, the scholarship amount was very close to the amount I had to take from other savings to pay the balance on the new heating/AC system. In other words, at the very time I had an expense I wasn't entirely prepared for, I got word that another big expense that is still a few months down the road won't be as large as I anticipated.

So here's what I learned: thinking ahead and saving in a dedicated account for future needs is a good thing indeed. Doing so with our heating/cooling need prompted us to keep saving, even though we weren't sure about the timing of when the system would go bad.

But I also was reminded that when you do your best to be a good steward by planning ahead and yet you still come up short, God often acts to make up the difference. This certainly isn't the first time I have witnessed His just-in-time provision.

When we get together with extended family next week for Thanksgiving, my wife and I will have a good story to tell about the wisdom of saving — and about the faithfulness of God.

I discussed the practicalities and benefits of multiple savings accounts in an interview earlier this year on The Meeting House on Alabama's Faith Radio. You can hear that conversation, with host Bob Crittenden, below.

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