Why have multiple current accounts?

Dobbibill

Jlawson118 wrote: »

I've just started myself a short term, part-time job and I've been earning around £144 per week, I've been putting £44 into my weekly spend, though I've quickly learnt that this isn't enough, and I was aiming to save £100 for myself to treat myself after Christmas, though I've ended up spending this on other things like breakdown cover for my car and probably a repair bill on it tomorrow..
But I am still trying to save it.. :rotfl: I haven't been able to for a while

Don't leave yourself short otherwise you will resent saving.

Try and budget for all likely bills. If you have done breakdown cover for a year start putting 1/12th of that aside......you know it's going to need renewing in a years time. Also if you have a car, put a little aside each week/month for the next bill. Anyone who has a car knows, a repair bill will be needed eventually, it's just a case of when

Saving isn't just about holidays or big purchases.

quackers82

I have a second current account for 2 reasons.

1) its a safety net. A few times recently some people have been unable to get money out of their banks when they have had computer issues, such as Nattiest and RBS. So i have Barclays and Natwest accounts, completely unconnected.

2) Main wage goes in Barclays, Bills come out, but i transfer my disposable to Natwest, so helps me not over spend, when its empty its empty.

SimonW90

I have a few accounts with Natwest but when I went into the bank at the weekend the customer advisor said the way I have them set up is strange and that it's confusing for them, I feel like they allowed me to open them so it's tough really...

All joint accounts.

Account 1 - Select account - No fee and no overdraft - Both of our wages are paid into this account and the cards for it are locked in my filing cabinet. If either of us get any extra money for anything it is paid into here also. Try to leave around £300 in this account at all times. Money for bills sent to Account 2.

Account 2 - Reward account - £3 monthly fee but 3% back on direct debits for utilities and some shops/cafes, £3000 overdraft - All bills/direct debits/mortgage are paid from this account, normally has a +£150 balance after everything paid just in case a bill is more for whatever reason.

Account 3 - Reward account - £3 monthly fee but 3% back on direct debits for utilities and some shops/cafes, £100 overdraft - All normal spending comes from this account, including credit cards, normal shopping, presents etc. Normally transfer £500 to this on pay day but changes depending on whether credit cards being used a lot (not at the moment as clearing the balance using 0% balance transfer offers)

Account 4 - Savings account - 1% interest (crap) but money goes in and out of this like wild fire at the moment as we are saving for wedding and paying bits off all the time. Balance yoyos constantly. On payday I move £350 into this account plus any overtime, once the wedding is paid off it will become the home improvment and emergency fund.

Am I over complicating by having so many accounts even though it gives me a great view of what is going in and out? I changed to this system after years and years of over spending and racking up a lot of debt that was seriously costing us (£350 in interest most months) and finally waking up and smelling the coffee, I know we will be debt free apart from the mortgage in just over a year and I feel great for it but I just felt so embarassed in the bank at the weekend and wondered if there was an easier way? Would making all purchases on credit card/s and then paying off be better than having the second account?

Cheers

Dobbibill

SimonW90 wrote: »

I have a few accounts with Natwest but when I went into the bank at the weekend the customer advisor said the way I have them set up is strange and that it's confusing for them, I feel like they allowed me to open them so it's tough really...



Am I over complicating by having so many accounts even though it gives me a great view of what is going in and out? I changed to this system after years and years of over spending and racking up a lot of debt that was seriously costing us (£350 in interest most months) and finally waking up and smelling the coffee, I know we will be debt free apart from the mortgage in just over a year and I feel great for it but I just felt so embarassed in the bank at the weekend and wondered if there was an easier way? Would making all purchases on credit card/s and then paying off be better than having the second account?

Cheers

You have the accounts so if it works for you then do it.

You don't have to make it easy for them to understand, they don't do your budget - you do!

Don't feel embarrassed, just tell them, you like it.....you nailed it in the first paragraph - it's tough.

All I would add is, make sure you are making a profit that is more than the 2x fees on Accounts 2 & 3 for them to be worthwhile.

Maybe also consider having one of the accounts outside the RBS Group just for peace of mind - if a major system failure happens then you will have all your eggs in one basket.

Jlawson118

Dobbibill wrote: »

Don't leave yourself short otherwise you will resent saving.

Try and budget for all likely bills. If you have done breakdown cover for a year start putting 1/12th of that aside......you know it's going to need renewing in a years time. Also if you have a car, put a little aside each week/month for the next bill. Anyone who has a car knows, a repair bill will be needed eventually, it's just a case of when

Saving isn't just about holidays or big purchases.

Great advice there! I've been saving for my insurance next year but breakdown costs never cost my mind. I'll be spending well over £100/£200 today for a service. I'm dreading the bill to be fair..

But yeah I got paid today so I set aside a small amount and kept the rest for my costs

Jlawson118

quackers82 wrote: »

I have a second current account for 2 reasons.

1) its a safety net. A few times recently some people have been unable to get money out of their banks when they have had computer issues, such as Nattiest and RBS. So i have Barclays and Natwest accounts, completely unconnected.

2) Main wage goes in Barclays, Bills come out, but i transfer my disposable to Natwest, so helps me not over spend, when its empty its empty.

Ever since I properly started banking, I always said that I never want to go with NatWest because there's at least every year, an issue for their customers accessing their accounts and withdrawing. Though I did apply for a student account with them recently and they rejected me. They never said why but I assumed it's either due to me being in my second year of university, or that my credit report is a little unsettled at the moment

System

I have two current bank accounts as I get paid four weekly and direct debits are taken monthly. So the pay day goes back 2-3 days each month. Last month, it was 25/11, this month 23/12, next month 20/1 etc.

So when I get paid, I go onto my internet banking and see what direct debits are going to be taken out between each pay days. As they are spread out throughout the month, most pay days, I miss one out. So the payday last week, my electricity DD isn't going to be taken out until 23/12 (the next payday). Then I leave the amount of my DDs plus £20-30 cushion and transfer the rest to my other account. I can 'forget' about the bills account as my money for everyday things comes out of the other account.

ravsd

ravsd wrote: »

I have 3 current accounts and a number of saving accounts

Current Account 1:
*My salary is paid into this account and all my direct debit and bills come out of this
*I have a number of standing orders which fund my other current accounts and saving accounts

Current Account 2:
*Lets say I pay myself £250 per month to spend on on anything I want without feeling guilty as I've already saved some money this month (see above).

Current Account 3:
*This is where the bulk of my money goes. My other half has access to this and essentially this is the family fund. Food, fuel, clothes for the little ones, going out all comes out of this account.
*We both fund it and we both know how much we have as a family to spend this month without feeling guilty as we've already saved via the standing orders on account 1

Following on, this question got me thinking and I have actually put together a deatailed guide as to why I have multiple accounts. You can check it out here

https://www.aneasierway.co.uk

Roseanne1

Just a quick question. I was watching the Martin Lewis money show about savings into different current accounts to make the most of the higher interest rates. I notice he said that, for example, you can get 3 vantage B of S accounts and put up to £5,000 in each and get 3% interest in each account. He mentioned paying your salary into one, a standing order for the £1,000 from there into account 2 and then a standing order from there into account 3 and basically recycle this £1,000 between the 3 accounts.

I am 99% certain there was a clause saying internal transfers aren't allowed and transfers from other B of S accounts would surely fall foul of this. Admittedly, I have been out of the loop for a while so did this change and if so when?

I also have a First Direct account for the regular saver. If I pay £1,000 a month in there, I avoid the fee. It states that this £1,000 can't come from anothr FD account. I am almost sure at one time it used to be that transfers from HSBC and M&S bank did not count towards the £1,000 pay-in. Is this all in my mind or has this changed too?

Thanks.

bigadaj

Why not bounce payments between your first direct accounts and your bos accounts if you are worried about it, seems like the easiest solution.