When we did our budget we tried to account for everything. When we were done though, we had a list of expenses (gifts, school, car maintenance, etc.) each with a monthly allowance listed next to it. Great! But, how are we going to keep track of the money we spend on those things and make sure we’re staying within our means?
7 Bank accounts later…
That’s right, we are now proud owners of 10 bank accounts. Ridiculous, right? Here’s why they are necessary for us:
* Main checking: This is the account everything gets paid from and all income is paid to.
* Main savings: We have some money transferred here every month for the purpose of saving.
* Each of our three girls now has their own savings accounts. Once we have anything worth speaking of in these accounts we hope to move them to a more profitable account like a mutual fund.
* We have our pickle jar savings account. This is the account I’m looking to bulk up so we can buy some of the things on our monster long list – like a riding lawn mower, apple trees, garden shed, chickens, etc, etc, etc,.
* Account F - checking account houses money for such things that don’t change like Life insurance premiums and car licensing. We’ve also accounted for car maintenance in this category.
* Account X – checking account houses money for less strict things like gifts, and vacation money.
* Account S – checking account houses money for school supplies, books and curriculum.
* Account C – checking account is for charity. We tithe 5% to church and then have fun with the other 5% by donating to things like Villa Marie School, Spirit Radio and sponsoring FOCUS missionaries.
Yep, 10 accounts. Ridiculous!
We totaled up how much we’d spend a year for each category, divided by 12 and set up automatic transfers. When we need to buy something, like say a birthday gift for a nephew, we’d make the purchase out of our main checking and then transfer the money from the gift fund back into our main checking. Voila! Budgeted!
I’m sure there are things we didn’t think of that will come up, but we’re hoping this system helps us reach our financial goals.
You know what, that is a really awesome idea having all those separate accounts! That would be more up my alley than doing the Dave Ramsey money in the envelopes thing because I am horrible about spending too much if I have cash. I do much better with my debit card.
ReplyDeleteI currently use Quicken and love it. I can keep track of all of our accounts and credit cards and create a budget. I'm a numbers girl and I love being able to run the reports and keep track of everything.
I think you've come up with a great system to work for you! Nice thing is you can always add or take away from the accounts down the road if you need to.
i don't think you're crazy at all! that's exactly what adam and i did. i think we set ours up in april, but we have our main checking and savings accounts as well as accounts for: vacation, christmas/gifts, tithe, yearly expenses (life insurance, school tuition, etc), kids activities (swimming lessons and ballet), and vehicle (oil changes and car registration). we do it just like you. we calculated out how much should be moved over into the accounts each month and then when we have a purchase from that category, we just transfer the money over. i think it's definitely a much easier way to save money for certain expenses and makes sure the money is there when it's needed. good luck with your money saving adventure!
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