One thing I’ve learned, and didn’t understand until I actually did it myself, was why some people had several bank accounts. It’s something that sounded tedious and time consuming but once you get the hang of it, it becomes pretty routine.
Account #1: Main Checking or Bills Account (Capital One 360)- this is the account where my paycheck is deposited and my monthly, recurring bills come out of. Everything that goes in and comes out is automated.
Account #2: Spend or Flex Account (GoBank)- this account is where my leftover money from my paycheck is deposited for miscellaneous (monthly subscriptions like Netflix or Spotify), non-recurring bills, groceries, and entertainment.
Account #3: High Yield Savings Account- this should be your favorite account once you get started (soon to be mine as well) any gift money, unexpected money or ‘loose change’ I find goes into here. I love my Ally Bank account for this because the interest on it is about .9% while your average savings account is about .01%. The more you save the bigger your return.
Account #4 & 5: Other Checking & Savings Accounts- I recently opened an account with the local credit union for county employees. It had always been my goal to make my way back to a credit union not just because of the customer service but they’re products. I’ve had some bad run ins with big banks (that’s another post) and for about 3 years couldn’t open accounts because of how our relationships ended (1 of which wasn’t my fault). So in order to reap their full benefits you have to open a savings and checking. I think I’m going to move some accounts around and get rid of one.
I like having several accounts because I feel like my money doesn’t get lost. I remember having only one account and asking myself where did all of my money go 3-4 days after payday. Now everything has its place and I can truly track my spending and curb some habits.
So if you’re in the market for a new bank or want to allocate your money so you can really see it, check out Magnify Money. You enter some info and they show you your best options.
How do you organize your money? What system works best for you?