I think by now I’ve done individual posts on some of the ways I keep my money organized but I’ve never laid it all out at once.
Today I wanted to show you how I organize my money and how I strive to reach my financial goals. My system takes away a lot of the need for actual paper and pen budgeting, which you’ll see below!
Setting Up Multiple Savings Accounts
The first method to my madness is having multiple savings accounts. I have a total of five separate savings accounts that each serve a specific purpose.
They are:
- Taxes
- Emergency Fund
- Down Payment Savings
- Kailyn College
- Ava College
I fund the rest by…………
Using Different Streams of Income for Different Goals
Now’s the fun part! I have several different streams of income. (I usually receive payments from more than ten companies/people.) And these streams of income are used for different things.
For instance, my largest lump sum freelance payment usually equates to what I’m going to owe in taxes. As soon as I receive that payment I immediately transfer it to my tax savings account. Sad, I know.
My ad network income (money I made from the ads on my blog) goes to my down payment savings account. These are automatically deposited in that particular account each month so I don’t have to worry about it.
A second freelance payment I receive gets transferred to checking each weekend and that is my bill money. Since we’re now living off of Jamie’s income too I’ll either transfer whatever money is leftover into checking to finish paying bills/living expenses or hopefully into savings. (Got hit with the six month insurance premium and $350 in physical therapy bills last month, fingers crossed nothing unexpected comes up this month!)
Automating Retirement Contributions
The only other savings that I have automated is retirement savings. I have $120 a month deposited into my IRA and then Jamie has much more automatically taken out of his paycheck on a biweekly basis.
The only bad thing about this is that I have to actually remember to record that money being taken out of checking.
Keeping a Buffer in Checking
Sometimes I’m really bad about balancing the checkbook. Like, I’ll go two weeks without doing it. (A habit I’m trying to break!) So to keep myself from accidentally overdrawing I’ve got a pretty good buffer in the checking account.
Even if I wasn’t terrible at keeping the checkbook balanced I’d still feel pretty comfortable having that extra money that I don’t technically “count” that is in there.
That’s How I Do It!
That’s how I keep all of my money organized. For me using different streams of income for different purposes has been great. It also motivates me to try and grow those income streams so that I have more money being dumped into the important savings accounts 🙂
Now I just need to go work on my filing system. My expanding folder is getting a little too fat. I think going paperless might be better………….
We have multiple bank accounts too. I thought I was the only one! LOL The reason I do this is for me because I know how we are and it has been working for us for many years. I have an account for bills, one for EF, a just in case fund, a down payment fund. I also have a Capital One 360 and I love it!
I love having multiple savings account. It is so much better to know what’s in each individual one rather than grouping them altogether.
I like that you use different streams of income to source your different pots of savings.
Yes I’ve found that it really motivates me to work on certain income streams because I know they’ll be going to some place good 🙂
Very organized! I like it. For your girls college accounts I’d highly suggest a 529 account. It’s basically like an IRA or 401k but for your children’s college. Plus you can contribute as little as $25 per month.
I know I need to open one. I really love Betterment but they don’t offer 529s! I need to find a good place to open up a 529 through.
It is important for me to have a Savings Account that I don’t have easy access to. ; )
Oh yes, I enjoy that feature too 😉
It’s so cool you have different revenue streams for different savings goals! I love that idea 🙂 Right now I have 2-3 clients, depending on the month, and all money goes to my business/quitting my job eventually fund. The fund is small for now (because I do pay for blog expenses out of it), but I hope to continue growing and then hopefully make that leap to full time freelancing! 🙂
Excellent ideas! I love how you use specific jobs to pay specific things. That’s something I’ll likely try to start implementing. Thanks for sharing!
This is an incredible post ! This tips and tricks are almost like life-hacks.Keep up your writing !
Nice Article! Setting up multiple savings accounts has worked so well for me and my family! It’s actually very surprising how much money you can save once you have set up pre-authorized transfers to be automatically transferred to a savings account.