An extra account?

[mlwear]

Excluding any investment accounts, college funds CD's etc. How many accounts is reasonable?

We currently have 2 savings accounts. We do al of our banking with a bank in another state. We have a checking and savings acount with them. We also have a savings account at a local bank.
DH wants to try some new budgeting ideas. I'm not even sure that I follow what he is suggesting, but it is something like...he wants an additional checking account that would be used only for big purchases. He wants to keep about $5K in it and that is what we would use when we decide we need/want to buy a new computer or TV or whatever. Then, I guess his plan is that we would have to replenish that account before buying another unnecessary big ticket item. As I write it, I understand a little better what he is getting at. Instead of dipping into real savings to buy these items, it would come from an already designated account. We don't always go to savings for these sort of items. We usually will use "extra" money like a bonus or I will have been putting money into our regular savings knowing that the purchase is coming up. A few times we have used the store's 0% financing and have always paid within the time limit.

It doesn't seem to me that a checking account is the best option. I think we could keep track of the extra money in our regular savings, but he is set on having this seperate account. (He even mentioned a seperate Christmas account, too.) A checking account isn't the best idea, is it? Wouldn't a seperate savings account be a better idea? We could earn interest that way. Advice or ideas?

How many accounts do you keep running? I have always just kept track of seperating things with our regular account (ex. I'll keep a record of saved money specifically for vacation even though it is mingling with our regular savings account funds.) Do you keep entirely seperate accounts for vacation(I know I have read of some on this board that do), Christmas, big ticket items...what is reasonable and where does it end? Do you used checking accounts or savings accounts? Do you keep them all with the same bank?

TIA

 

[rie'smom]

I have 3 checking accounts.One for bills and taxes,one for trips/house projects,and one for everyday. This may not be the best for everyone but at tax time,it's easy for me to see expenses and to keep track of the amount of money inthe tax account to cover the taxes not covered by paycheck withdrawals,etc.

 

[nepean]

We have one checking account, and four savings accounts. The four accounts are: 1- overflow from checking (we only keep enough in checking for weekly bills) 2) savings for new car every three years (we have two cars and always pay cash and trade one every three years) 3) savings for vacations and large purchases 4) long term savings . We also have retirement accounts (RRSP's in Canada, similar to IRAs) for each of us. DD has her own checking and savings. She also has a college trust account. We are fortunate that we do not pay bank fees for anything and we find it easier to have separate accounts for planning not that any of them are all that flush.


Nepean

 

[disneysteve]

We have one checking account and one money-market mutual fund account (with check writing privileges). We also have an online high-yield money-market account. I guess everything else would qualify as an investment account.

 

[rie'smom]

OT Steve the saying about paying for your daughter's education is hilarious! Thanks for the laugh!!