I’ve tried 3 different methods for building my savings automatically


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  • I’ve tried three different ways to automate my savings, and while all three have helped me save more, there’s one I like most.
  • I used to have my paycheck split up and deposited into two different accounts: 10% into my savings and 90% into my checking.
  • When I started freelancing, I set recurring weekly transfers from my checking account into my savings account to build an emergency fund.
  • Now that I’m taking on new clients and my income is increasing, I set up all of my payments from one client to be deposited directly into my savings account. 
  • Use Blooom to analyze your 401(k) today and see how you can grow your retirement savings »

Saving money is not a skill that comes naturally to me. In fact, I spent most of my 20s digging myself into credit card debt and not saving a penny.

That’s why the trick of automating savings was made for me. This kind of “set it and forget it” method for saving money, in which I don’t have to think at all about whether or not to save the money I receive (and thus decide that I’d rather spend it on an impulse buy or a plane ticket), was just what I needed to get me to finally start saving.

It worked. I went from being $10,000+ deep in credit card debt in my 20s to having a $20,000 emergency fund and a budding retirement savings account at age 30. In the past few years, I’ve tried three different methods for automating my savings. While they all worked, one has become my new favorite. 

My old employer let me split up my direct deposits between my checking and savings accounts

Some employers will allow you to split up your paycheck across multiple accounts. This was the case with my old employer, so when I set up my direct deposits with them, I had 10% of my paycheck deposited into my savings account and the other 90% into my checking account. That way, I could save money automatically and I didn’t have to worry about overdrawing my checking account with recurring transfers.

This was ideal when I was working one full-time job. The money went directly into my savings account so it was like I never even had it to begin with, and being able to pick a set percentage of my paycheck meant I didn’t have to do any math to figure out how much I should be saving. Most personal finance experts recommend saving at least 20% of your income, but I didn’t prioritize saving back then like I do now, so I set the rate a little lower.

I set recurring monthly transfers into my savings account

This is probably the most common method for automating your savings. Once I started freelancing and no longer had the option to split up my direct deposits, I simply set recurring monthly transfers from my checking account into my savings account so that the process of saving could still be automated.

This is how I built a $20,000 emergency savings fund a couple of years ago. I set up weekly transfers from my checking account into my savings account to take place right before the weekend so I couldn’t go out and spend that money.

This method works perfectly if you have a steady source of income and are good at monitoring your spending. However, if your income goes up and down and you’re not meticulous with your spending, you could risk overdrawing your checking account during a low-income month when the transfer processes. That’s why, as a freelancer with unpredictable income, the following method has become my favorite.

To boost my savings rate, I recently set an entire stream of income to be direct-deposited into my savings account

This method works for anyone with multiple streams of income they receive through a direct deposit. I’m a freelancer with multiple clients, so I set up one of my clients to send all of my payments from them directly to my savings account.

As a freelancer who lost a few clients during the pandemic, I’ve finally started regaining work. But I’ve been living without that income, and I need to boost my savings. So, when a new client asked for my direct-deposit information, I gave them the account information for my high-yield savings account rather than my checking account.

So far, this is by far my favorite method for boosting my savings rate. I’ve had to use 25% of my emergency fund during the pandemic, but thanks to this new method, it will be fully replenished within one month. My goal is to get my savings rate up to 50%, which I’m doing by having around half my clients direct-deposit my payments into my savings account.

I’ve tried all three methods, and while the last one is my favorite, I can attest to the fact that all of these automation techniques are effective. Automating my savings was the only thing that got me to finally build a savings habit in the first place, and it still helps me save far more money than I would if I tried doing it manually.

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