From Pat Veretto,Your Guide to Frugal Living. 

Savings all at once; how to see what you’re doing
We’re supposed to have three to six months living expenses tucked away in case of job loss, on top of emergency savings, special goals savings, and long term savings. That’s a lot of savings and more times than not, people are not able to cover it all. It’s hard to save that much in that many ways.

Most of the advice you hear amounts to putting a little here, a little there and a little somewhere else. You could easily have a half dozen savings accounts, but you would still have the same amount of money to spread around in them! Yes, it does add up, but you can’t really see it adding up very fast. Sometimes we need more immediate results to encourage us, and there is a way to see those results.

I recently began using what I call the “lump” method. This is how it works:

Open one savings account, generic, low interest, available 24 hours a day. Make it convenient to make deposits and withdrawals. Put ALL of your savings into it, for every thing you usually save for, for the whole month.

Make sure you add up all that you need to save for. If you use savings to pay for annual premiums or dues, add it in. If you have a goal of saving $500 for Christmas (or vacation, or whatever), add the monthly payment in. If you need to have another couple of hundred in your emergency fund, divide it by twelve, then add that. Regular monthly or annual payments to investments or other funds can be added. Write it all down, what it’s for and how much, then calculate the total. Put this in your little old generic low interest bank downtown this month.

In a week or so, take a look at it. Do you have enough to top off your emergency fund if you ignore everything else? Or maybe there’s enough to finish your Christmas fund, or is there enough to pay the yearly insurance bill?
Here is where records must be accurate! Make sure you have it all written down and go down the list, sorting into what is the most immediate need. Choose the one that is needed next and, if you have enough money in the account, ignore everything else, and pay it all.
If you don’t have enough this month, wait until next month (assuming you’re not behind on payments). It’s a great feeling to knock out a goal in one fell swoop. An emergency fund that you might have tried to beef up all year is suddenly full and finished. Take the money, put it in the account that you have for the emergency fund and forget about it until/unless you need it. Or pay that insurance premium and you won’t need to even think about it for another six months.

If you can’t pay all of any one thing at a time, put most of your savings toward whichever is most important to knock it down as much as you can. Next month, do the same thing. And on and on…

No, you won’t lose money on it.
When you pay a larger lump into a higher interest account, you’ll make more interest faster. On the months that you don’t pay into a higher interest account, you’ll still be gaining, and your other accounts will benefit.

Yes, the money for everything will always be there.
Faithfully continue to put in the correct amount each month that totals all of your savings needs. This means that, even though you paid off the six months premium on your insurance, the monthly amount will still be saved into the generic fund every month.
You’re saving the same amount you would anyway, but it’s all there, in one lump sum, so you can see what you can do with it - and have the power to do it.
I know there are those who would disagree with this method. They’re the hands on, penny splitting, accountant type who moves money around as if it were grains of sand in a sand box. If you’re one who can deal with it in that manner, go ahead. For those of us who tend to deal with money differently, it’s great to see lump sums heading in the right direction, instead of fragments flying off in all directions.

There’s something cool about making your money work for you - your way.