Hasta La Ideas

Last winter, when one of our cats was diagnosed with a rare cancer, my husband and I took the cat to a renowned pet oncologist. Some of our friends, the pet lovers in our group, said they would have done the same thing to help a member of their family. Other friends, mostly people who don’t have pets, called us fools for considering the thousands of dollars in cancer treatments the oncologist might have recommended.

We ended up not having to make a treatment decision because the cancer was untreatable, and Basie cat passed away a few days later.

A couple weeks after that, my husband and I sat down and talked about setting up a medical saving account for our cat Charlie and any future pets we might adopt. We put $500 into savings and have been depositing $20 per month ($10 each) into the account since that time. Commercial pet insurance can be more expensive than what we’re doing, and, like traditional health insurance for people, it doesn’t cover all medical procedures and treatments. And, if we never need the insurance, we wouldn’t get the money we paid the pet insurance company back or with interest or be able to apply the premiums to another pet.

Simply, we created the specialized saving account for our pet because we never want to be in a position again where money has to be strongly considered along with treatment options.

After making this decision to create a medical saving account for our pet, we started to realize how this way of budgeting could help alleviate stress associated with other areas of our finances. We immediately created a specialized saving account for our automobile — $20 a month now goes into an account to cover service needs for our aging car. We also made a window replacement fund since we have a house mostly made of glass and a toddler with an amazingly strong throwing arm.

How to create a specialized saving account: When you acquire a new responsibility, you deposit an eighth or a quarter of your saving goal into a dedicated saving account as the account’s start-up fund (or a multi-use account that you keep records for what money in the account is for what purpose). Once the saving account is open and initially funded, you set up an automatic transfer through your bank to put $10 or $20 (or whatever amount you choose) into the new saving account from your checking account every month. This automatic deposit removes the temptation to spend the money on something else.

These specialized saving accounts reduce your stress, allow you to cover large expenses when they arise, and help you to live with an uncluttered budget (a budget where you spend less than you earn). Do you have specialized saving accounts? Would setting one up help you to prepare for an emergency expense? What reasons do you have to create a specialized saving account?

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