Saving your money

I believe most of you save your money someway and somehow. Banks are the best places we can keep our money. Imagine you have $1,000.00 right now(maybe more). You can put the money in the bank and need not worry about it getting lost or worry about having & losing $1,000.00 worth of notes or coins hiding somewhere in your house. Bank is the most secure place where we can keep our money.

With this amazing thing in the world. We must make good use of it. Let me share how we can go about doing it. I recommend that each of us have at least 3 bank accounts in 3 different banks. Each of them holds a different purpose and it must be strictly adhere to.

• 1st account: Spending Account (touchable)
• 2nd account: Savings Account (untouchable)
• 3rd account: Others Account
  

I believe most all of us have at least 1 account. This is the one where we usually keep our money such as deposit our salary, store our savings, use it for our daily expenditure. This is not wrong. But I believe most of you ends up having trouble balancing the money in the account, such as,

• I tried to save my money, but by the end of the month, it is almost gone,
• I am spending my money too fast,
• Where have all my money gone to?
  

Now, let us take some extra steps to ensure we can ALWAYS avoid the above scenario .

Step 1: Opening additional bank accounts
Let's open another two more bank accounts with other banks. The objective of this step is to ensure that you will have at least 3 bank accounts.

Step 2: Identifying the 3 bank accounts
We shall label this 3 bank accounts as

• 1st account: Spending Account (touchable)
• 2nd account: Savings Account (untouchable)
• 3rd account: Others Account
  

Step 3: Using the 3 bank accounts

Let me give an illustration,
Imagine I earn $1,000.00 per month, and it was automatically credited in the Spending Account.
I will save 10% of it, and that will be $100 (remember Savings Rule Number 1?), and transfer this 10% to my Savings Account.

Now I will have $900.00 in my Spending Account, and $100 in my Savings Account. As the days goes by, I spend a total of $850.00 in the month. Therefore, I will have a balance of $50.00. This $50.00 shall be transfer into the Others Account.

You can spend whatever you have in the Spending Account, hence it is known as the touchable.
But you can NEVER EVER EVER touch the Savings Account, that is why I call it the untouchable.
So, what do we use the Others Account for? We can use this account for any other special purposes.
For me, every month, I transfer a small amount into the Others Account for any future investment purposes. It can also be used as a backup account, just in the event you exceeded your spending in your Spending Account, you can still rely on the Others Account. Please note that, regardless of what happen, the Savings Account is untouchable for any minor issues.

I would suggest that this Savings Account be used when you need to bring your family out for a holiday once a year, or if some unfortunate event happen and you are in need for immediate cash, it can also be used.

The most important rule here is to be DISCIPLINE.

Feel free to drop me a note on this post if you have a different view or have some better suggestions.