Budget tracker: Using multiple bank accounts to track money

Managing money is hard-figuring out the best budget tracker for us

The Dude and I are doing a few different things with our money these days.

  • Set up and consistently reconcile a monthly budget that is broken into pay periods
  • Use cash envelope systems to track day-to-day spending
  • Use sinking funds for expenses that are not routine or not often, but definitely need funding
  • Set aside money to cover the time the Dude is out of work for surgery. This money is separate from the emergency fund.
  • Track our credit card payments and snowball as we pay each one off
  • Be very mindful of each purchase

What is working

For the most part, these have been working well. We have not taken on new debt and have paid off one of our smaller ones. Additionally, we have stayed in or really close to our budget, and several times have had money left over at the end of the month!

What needs help

The first issue was the cash envelope system for all things household related. We tried having different cash envelopes for each separate thing, for instance health and beauty in one, household cleaning in another. But that got super messy at checkout time.

Another big struggle has been spending money when we are out separately. Let’s say I want to stop at Walgreens for deodorant on the way home. Well, there is a good chance that I forgot to grab the envelope, or the Dude and I might both need to use money from it.

Budget tracker-tossing pages of a budget away

How we are resolving it-using a budget tracker

So far, we are still in the messy middle. But this is what we are experimenting with.

First of all, we combined all household things into one single household envelope. I made a Google spreadsheet to tracking our household spending. So far, it is hard to remember to come home and track everything, but we keep trying. This sheet covers all of the household spending, but also covers other types of spending. The numbers from this sheet feeds into the master budget. Doing this method allows us to keep the physical money together, but separate the spending into different categories.

The problem of where we keep the household money still lingered. When one of us would go out and not have the cash envelope, we would just put it on our main debit card. Many problems with this:

  • Knowing how much is still in the envelope so we don’t overspend from our bank account.
  • Having to go home, take the physical money out of the envelope and then drive it to the bank to deposit it into the main account.

We tackled this problem by opening a separate checking account that is just for household spending. It is an additional account at our bank, tied to our main account, but the deposits and withdrawals are separate.

Each payday, we deposit $100 into the household checking account. The Dude and I each have a debit card for it, and we each have the bank app on our phones so we can check the amount that is there. Now the money is separate from our main account so we can carefully monitor how much is going out, but we also have access to it.

There are pitfalls to using cards instead of cash. I am trying to be mindful of that and if it becomes a problem, I will force myself to use an ATM and take out the anticipated amount of cash before I go into a store. And then will put the change back into the account. Hopefully I don’t have to move to that method because it is a hassle.

It is important to figure out a system that works for you. Not the neighbor, not the finance guru. You. And keep tweaking it until it really works.