Separate your Money to Make Budgeting Easier!
I’ve talked about this before but today we're diving into more details on the game-changing strategy of separating your money for bills, spending, and saving. If you've been struggling to manage your finances, this approach can be exactly what you need to hit your budgeting stride! Let's me break down for you and map out exactly how you can set this up for yourself.
Why Separate Your Money? Well, let's start with the obvious. ADHD or not, it's easy to get overwhelmed when your money is all mixed up. By separating it into different buckets, you bring clarity and structure to your financial life. It's like organizing your closet – suddenly, you know where everything is, and you can find what you need when you need it. Much like organizing your closet, it can feel messier when you first start, but stay the course and a month from now you’ll be thankful you did.
Bills Bucket: The Necessities, your first bucket is for bills – the stuff you absolutely need to pay, like rent or mortgage, utilities, and insurance. This is non-negotiable, and separating it from the rest of your money ensures you never miss a payment. Automate these if you can; it's a game-changer for us ADHD folks with time blindness! As these bills are usually pretty consistent after reviewing your budget, you’ll know how much you need in this account.
Spending Bucket #1: The Variable Stuff, this is where you allocate money for all of the expenses that vary week to week, like groceries, gas, and other necessary spending. You put the same amount in each pay day and your account balance helps you make spending decisions.
Spending Bucket #2: The Fun Stuff, this is for spending on all the things you love, whether it's daily lattes, eating out, or retail therapy. Separating this from your bills and variable necessities helps you control your spending while still enjoying life.
If you don’t manage your finances with someone else, you can combine all of your variable spending together. If you manage your finances with a spouse or partner, I recommend you have Bucket #1 as a joint account and that you each have accounts to cover Spending Bucket #2.
Savings Buckets: Saving for Future Wants and Needs Now. Saving for the future is a critical part of managing your money, whether it's an emergency fund, retirement, or a dream vacation. It's like paying yourself first. Trust me, you won't regret it. I love separate accounts for each saving item with automation to fund the accounts. Learn more by checking out my blog on Sinking Funds.
Finding the Right Financial Institution
You've decided to separate your money, but where do you put it without adding bank fees and maximizing interest? I got you covered.
Tangerine: They offer no-fee chequing and savings accounts. Plus, their "Automatic Savings Program" is a great way to automate your savings. They do have limits on the # of accounts you can have including a max of 2 chequing accounts so consider this when you are deciding. (We’ll both get a bonus if you sign up with my referral code and meet the requirements: 34771511S1 )
EQ Bank: With no monthly fees and a solid interest rate on their Savings Plus Account, it's a top choice for your savings buckets.
Simplii Financial: They provide a no-fee chequing account and savings account options.
KOHO: If you prefer a fintech solution, KOHO's prepaid Mastercard card and app let you divide your money into spending and savings easily, with the option to automate moving money toward your savings goals. Plus, they offer cashback rewards.
Remember, these are just a few options, and what works best for you might vary depending on your preferences and financial goals. ADHD or not, you're unique, and your financial plan should be too.
So, separate those buckets, automate as much as you can, and watch how it simplifies your financial life. And if you ever need more advice or have questions, you know where to find me. Cheers to taking control of your money! 🚀💰
