We have three large expenses that we are saving for each year.
1 and 2) two tuitions each year
3) pool membership
4) we should also be saving for gymnastics since that is about $900 during the school year
We have a separate savings account that we make automatic payments to on a weekly basis. If we did this manually there is the chance for user error, I forget to make the transfer or the funds are already spent.
Currently we transfer $90 per week to the savings account. Starting in 2009, this will change to $120 per week.
The trick here is that we are using current paychecks to make these future payments without having to dip into any additional savings.