With my focus on ways to save money one thing I look at is the interest rate I am getting.

I have been a loyal fan of ING and it is currently my main savings and main checking account.

I was speaking to Baz earlier and he mentioned opening a new savings account take advantage of the savings account rates that ING offers. This made me realize that I have not looked at the rates in a while so I logged in to my account to see what was going on.

  • ING Savings account: 3.00%
  • ING Electric Checking account: 1.74%


This startled me because not only had I been using Electric Orange and my main checking account, it was also my main account. Period. I was having my paycheck direct deposited there because it was easy to set up and manage.

When I got a payment from a sponsor I used the Electric Orange account to collect the funds when possible. My Lending Club Loan comes out of my Electric Orange account so I also linked that account to the payments received from the people I lent money to on Lending Club.

I just realized that my Orange Savings account is earning almost double the interest that my Electric Orange account was getting but I was not taking advantage of the money there. The only thing I had there was my Never Go Back To Fresno Fund and I have already said that it is a very small amount right now.

I had the bulk of my money just sitting in Electric Orange and earning 1.74% when it could have been earning 3%! Now how smart is that? I quickly logged in to my ING account and figured out the difference between what I needed to send out as payments between now and the next payday and the balance that might be left over in the account.

It came to $374.25 so I immediately transferred $300 over to the Orange Savings account to take advantage of the interest rate. $50 will be sent in as a snowflake payment to the credit card and the other $24 will remain in the Electric Orange in case I overlooked something. This will lessen the amount that I have to transfer out of savings next month in order to cover all purchases and bills.

This means I will always have a $24 buffer in the Electric Orange account that is gaining interest at the rate of 1.74%.

I am also going to transfer the amount of the paycheck (less half of my monthly expenses) back into the savings account and only move a bulk of money over to the checking account as I need it to pay bills . This will allow me to take advantage of the higher interest rate while still keeping within the limit of less than three withdrawals from the savings account per month.

By doing this I will be able to see my savings grow and while I will still have the ‘expense’ of my Never Go Back To Fresno Fund I will also have a separate savings account that will take care of all the growing snowflakes.

  • What do you think of this method?
  • Have you tried something similar with your finances?
  • What are the flaws you see in this system?