Be a Finance Squirrel

When it comes to tricking yourself into saving more money, think like a squirrel. Just like squirrels bury nuts to prepare for winter, we can squirrel money in order to prepare for economic dry spells. And while we’re taking money lessons from squirrels, they crucially don’t store all their bounty in one place.

How squirreling away money helps you save more

The concept of being a financial squirrel comes down to minimizing the risk of keeping all your savings in one place, and maximizing the rewards of building several different accounts. Especially if you aren’t interested in investing your money in long-term vehicles, it’s useful to trick yourself by shrinking the amount of savings you can see at one time.

Personally, I like to think of it like “hiding” my own savings from myself—it makes me far less likely to dip into it. An easy way to do this is to create an extra savings account is for the sole purpose of forgetting it exists (until you absolutely need to tap into it).

Squirrel away your money to stay on top of your goals

The squirrel mentality is also useful for visualizing different savings goals. For instance, you can start naming different accounts based on what they’re for. You might have your standard rainy day fund and Roth IRA, but you might also have a summer travel fund, a back-up rent fund, a new car fund, and so on. It’s much easier to track your savings progress when these funds are divided into different accounts. Here’s our guide to creating a high-yield savings account.

There are plenty of reasons you might choose saving over investing, one of the biggest being if you have short-term goals for your money. So if you mentally struggle to set aside savings, consider “hiding” it from yourself in multiple places—like a squirrel and their precious nuts.