Too Many Accounts?

09Feb10

I don’t know about you, but money can get a little confusing for me if I just have all of it in one (or two) BIG accounts, and I have to sort it all in my head from there (vacation money, new gadget money, emergency fund money, etc. etc.)
And I also don’t know about you but when I have all my money in my checking account I tend to feel like I can SPEND all of that if I want to. And unfortuantely, those my checking account makes 3.5% I don’t keep that much money in there because I know I’ll spend it. So right now, I have my money split up into several different accounts.

Here’s the break down:

1. Checking Account

This is where I keep the money I allow (or make) myself spend during the 2 week period between my paychecks. This is where I keep my money for paying bills (rent, utilities, cell phone, etc.) as well as where I keep the money I’ll be spending on food, entertainment, gifts, etc. It’s a pretty important account, and I’ve always had one at a local credit union because they are NICE and don’t charge many fees.

2. Emergency Savings Account

I keep this separate from my checking account for obvious reasons–it’s for emergencies! My long term goal is to get this up to $10k-$15k. (Right now it’s at $700….=) What is an emergency you ask? Well, my definition is an emergency is when you lose your source of income and have to live while you look for a new one! For me, it’s not a fund for repairs or insurance deductibles (medical or auto.) That’s why I have these funds…

3. Insurance deductible account and Car Repair/Tires account

I don’t keep my insurance deductible for medical or vehicle in my emergency fund because I can pretty much count on needing this money. But it does need to be there when I need it so I have a separate account. Same thing with my car repair/tires account–I KNOW I’m going to need to repair something on my car at some point (like I said in the About me section…my car is a late 90s model) and I also know I”m going to need new tires eventually. So right now, with my limited income, I need to have that money set aside when I need it. These accounts I’d like to have each $1,000 in them at all times.

4. School account

Ok, many of you won’t need this but I do. I am putting down at least $700 in cash down every semester, and I need to save to make this happen. I also want to pay off my student loans so any extra money I can I put into this account to either pay cash on some of my tuition or put a little chunk on my student loan to start eating away at it.

5. Vacation Account

I know I love budgeting and saving money, but I also love to have fun. There’s no reason that why I’m saving for an emergency, for school, for expected expenses, and hopefully soon for retirement that I can’t also save for a vacation! My goal is to get this up to $1500 so a friend and I can go on a cruise to celebrate her 21st birthday this fall.

6. Small Item Account

You’re probably asking, “Are you serious??” You need a small item fund?? And my answer is YES. I do. You may not, but I do. And this isn’t for small items like q-tips or cereal. This is for small items like a new cell phone, furniture, a new TV or something like that. It’s basically a “cash savings” for the fun stuff in life. Just like the vacation–we need to enjoy the fruit of our labor–even while we’re saving like mad! There is no limit to how much I’d like to have in this account. The more the better obviously but it seems to be the account that regularly goes back down to $0 because once I have saved however much I need for a specific item, I take the money out and S-P-E-N-D it. =)

7. And then of course I have an account where I actually took money from the bank (my student loans) but I’m working on paying those off!

8. I also have an account with ING Sharebuilder where I buy and sell stocks online–I don’t do a lot of this because I don’t have the extra money to play around with, but once I do ING is a great way to do this on your own for cheap.

So there you have them! All my accounts. These aren’t “budget categories” these are actual accounts I have open at a financial institution of some sort. I am hoping to open up a Roth IRA before April 15 probably with ING so I can start saving for retirement, but I’ll let you know when I do that so you can join in on the celebration.

What about you? What kind of accounts do you have? Do you need more or less?–or do I need more or less?

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