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When do you think that owning more than one bank account is a good thing?


Most of the time, when it comes to personal finance, “the simplest is best”. This is an idea that will serve you well. In this case, this philosophy does not seem to favor the possibility of having several accounts to manage its budget well. However, many will find, in this approach, the dynamics of budgeting necessary for their personal financial success.


How does it work?

How does it work?

Most people deposit their salary into a bank account. Others receive it from their employer by direct payment. In any case, once the day of the salary has arrived, the employee sees his income deposited in the checking account.

To simply explain how this budgeting technique works, we will use “two banks”. Basically, you will continue to deposit the money into your bank account as before. However, you will open a second account (in the same bank or another bank).

What will the rules of this second bank account consist of?

  • You will need a checking account that you will use for your daily expenses. To this one will attach a debit card or access to the ATM.
  • You can also transfer a portion of the money from your first chequing account to this new no charge account.
  • Ideally, the account will cost little or no expense in general.
  • The ideal would be to manage it easily online. You will be able to adjust the amount of the automatic transfer if it proves necessary.


What happens next?

bank account

After opening the second account, you define the automatic transfers you will establish between the first and second accounts. They should take place a few days after the payment of your salary. Then you will start with a 90% transfer of your deposited income. If, after the first few months, you see a surplus of money, you will reduce the amount of the transfer to 85% (so that you will save 15% instead of 10%).

You will use the money transferred to your new account to pay all your bills and daily expenses. The 10% of the first bank account will then become your savings that you will use for emergencies or registered investments or not. If you feel comfortable with this strategy, you can set up automatic transfers from the “10%” account to a savings account.


What if I need money faster?


Ideally, you will accumulate enough money in your account of 10% so that it can cover the most possible expenses. However, unforeseen events may occur before you have saved enough money in this account. In these conditions, you will try to get a personal loan online. It will often take only one day between the request and the payment of the money in the bank account. This makes it ideal for emergencies. Then you will use the 10% you had to save to pay off the personal loan online. Once the loan is repaid, you will resume your usual strategy between the two banks.

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