Budgeting The Blog

Separating Your Accounts to Save More

Budget documents, computer, notebook

How separating your accounts to visually represent your different budgets can help you spend less and save more!

Disclaimer: In the name of full transparency, please be aware that this blog post contains affiliate links and any purchases made through such links will result in a small commission for me (at no extra cost for you). As an Amazon Associate I earn from qualifying purchases. I am not a finance expert. Anything written here are just personal experiences and my own opinions.

Why should you separate your accounts?

I recently was thinking about how I have been told that I am really good with money. In fact, I have been able to help my husband get his savings to increase by 90% over the 5 years we have known each other. In thinking of this I decided I wanted to try to help others do this too. I really enjoy helping people achieve their financial goals. I thought I would share my money management technique of separating your accounts in hopes it can help you attain your next big money goal or just get a better handle on your finances.

How do you separate your accounts?

What I believe helps me the most in successfully managing my money (after the actual having a budget part 😊) is separating my accounts for separate purposes. This really helps me visualize how much money I have for certain things and keeps me on track.

If you are interested in using my technique, here is how I break down my bank accounts.

Disclaimer – this does not include any retirement accounts this is just focusing on that cold hard cash. I love PNC and would recommend them if you are looking to open a new account.

Breakdown of my separate accounts

I have 4 accounts in total, and I label them all per their purpose. Yes, you can actually nickname your accounts in online banking. Let me go through each.

Your basic checking account – or as I like to call it my spending account

I use this account for my everyday expenses. This is where my direct deposit comes in and where I pay all of my bills out of. I truly only keep the amount of money I get as income each month in this account. If I get to the end of my budget before the end of the month, this account literally will be at zero dollars. That way I can really see that I have nothing left to spend.

Your basic savings account – I call this one my long term savings

This is the account I enjoy looking at the most but touch the least. I put the money from my budget that I allot to savings each month in this account. This is my nest egg as you would call it. I only touch this account for huge purchases. Like I am talking the last time I touched this account was to get the down payment for my house. Nothing short of a house, car or a major emergency (that I can’t use my fun account for) could cause me to touch this baby. I have gotten myself in the mindset that I get angry when I have to take money out of this account, that is not what it is for. So, if I am making a withdrawal it better be something good.

My joint account – this one doesn’t actually have a fancy name sorry to disappoint

This is the least interesting of my accounts, as the lack of a nickname might suggest, though I am open to suggestions 😊. This one is the joint account I have with my husband. We pretty much keep our finances separate but do have this joint account where we keep some of the money we got for our wedding. This is another rainy-day fund kind of account. We only use this for big purchases.

Now I have saved the best for last. Do you want to have an account where you can look at it and think hey I have money to buy those shoes I really want or I have money to take that girls trip, or I can cover that surprise medical bill without dipping into my savings. Well let me introduce you to the fun account.

Second basic checking account – this is my FUN account

You have probably figured out by the name, but this is where I store any little bit of extra money I have. Let’s say I didn’t spend all my allotted budget for gas this month, that little extra bit is going to go in my fun account. Got some birthday money, fun account. You see the point. But this way I constantly know how much disposable income I have. Now this is separate from my monthly spending money, which I do have, but this is for more special purchases than that. I like to let this account accrue some funds and then treat myself to a new designer purse or that weekend trip I have been wanting to take.

So, there you have it, a complete breakdown of separating your accounts! I hope you found this insightful and can incorporate it into your money management strategy to help you spend responsibly and keep that savings expanding. Happy penny-pinching, friends!

If you found this helpful check out some of my other budgeting tips or if you are looking for some penny-pinching ways to update your house check out my post on how to update your brass doorknobs!

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