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A new survey from Empower finds that Americans spend nearly four hours each day thinking about money. Gen-Z leads the pack, averaging 4.82 hours daily.
Bills, debt and the fear of not making ends meet are a constant source of anxiety that affects many people’s physical and mental health. The same Empower survey found that 36% of Americans lose sleep over their financial worries.
As heavy as the mental load may be, a surprisingly simple tool can help you feel more in control: a high-yield savings account with separate sinking funds.
The Financial Burden of Everyday Life
Empower’s poll shows that younger generations feel pressure from all sides. More than half of respondents—57%—report worrying about paying their bills, with rising costs, debt and housing expenses contributing to the stress.
Gen-Z is the most likely to constantly check their bank accounts and feel emotionally drained by their financial situation.
Many members of this generation are juggling soaring living costs and paying off student loans on entry-level pay. With student loan debt in the U.S. totaling $1.777 trillion, financial anxiety isn’t just a passing thought—it’s a daily weight they carry.
Turning Worry Into Strategy: The Power of Sinking Funds
If you’ve ever felt like your paycheck is completely gone in the blink of an eye, sinking funds might be a game-changer.
A sinking fund refers to setting aside money for specific expenses in advance. Instead of saving one significant lump sum for emergencies, you break your savings into categories, such as a new car, next vacation, medical expenses or holiday gifts for the family. That way, you’re not panicking when those costs arise—you’ve already planned for them.
Now imagine those savings buckets actually earning you money while they sit. That’s where a high-yield savings account (HYSA) comes in. Unlike a regular savings account, the best HYSAs offer higher interest rates, so your money quietly grows in the background. You can set up multiple sinking funds in one place, because let’s be honest—after a full day of work, who has the energy to manage multiple banking apps and platforms? Just set the money aside and let it do the work for you.
If you use a high-yield savings account to label or bucket your savings, you can manage all your sinking funds in one place while watching your monthly balances increase. This setup brings structure and peace of mind. Instead of spending hours each day focusing on “what ifs,” you’ve created a small system that prepares you for anticipated and unanticipated expenses.
To see how quickly your money can grow, let’s say you open a HYSA with a 3.50% APY that compounds monthly.
If you deposit $300 upfront and each month after, by the end of one year, you’d have $3,968.99, of which $68.99 comes from interest alone. That’s almost $70 earned passively, just by letting your money sit and grow. To see how much interest you can earn with your HYSA’s terms, use Forbes Advisor’s savings calculator.
When selecting an HYSA, shop around to find the best rate. You’ll want to find an account that offers at least 3.00% APY, does not charge monthly maintenance fees and allows you to organize multiple sinking funds within your account.
For example, the Capital One 360 Performance Savings Account™ currently offers a 3.50% APY. It also charges no maintenance fees, there is no minimum balance requirement to maintain your account and you can set up multiple accounts for different sinking funds.
How To Get Started
- Open a high-yield savings account. Start by looking for an account with no monthly fees and a competitive APY. Many banks make it simple to open an account online without needing to visit a branch.
- List your goals. Consider recurring expenses like vet bills, holiday gifts or travel, and create a separate sinking fund for each.
- Set a monthly savings goal. Estimate the cost of each goal and divide it by the number of months until you’ll need the money. Then, automate monthly transfers to your sinking funds accordingly.
- Track and adjust. Life changes, and your sinking funds should too. Revisit your setup every few months to tweak your categories or contributions.
Bottom Line
No savings system will eliminate all financial stress, but tools like sinking funds can lift a massive weight off your shoulders. For Gen-Z and anyone feeling constant financial pressure, having a HYSA broken into manageable pieces and earning interest while you sleep can bring emotional relief.
If you spend hours a day thinking about money, you deserve a system that works just as hard as you do. And remember: Taking care of yourself matters more than the number in your bank account.