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Living on a budget – why several bank accounts can help

Lots of people struggle with living on a budget, and budgeting in general. It can be really difficult to make your income last to the end of the month if you don’t create a system that helps, and using several bank accounts is a really good way to help make living on a budget much more simple.

Are you trying to organise your household budget? 2 or more accounts could make life so much easier - here's how...
© Andres Rodriguez |


I have used multiple bank accounts for most of my adult life, as I have found it really does help me to stick to a budget, save as much as I can, and also not feel guilty about some spending on treats sometimes – and I want to share my thoughts on it today in case it helps you to do the same.

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Why use multiple bank accounts?

The thought process is that if you have access to all your money at all times it is far easier to spend too much – and if it’s spread out more then it’s safer when it comes to living on a budget.

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Who would use it?

Anyone really! – it’s one of those tips that I firmly believe can help anyone get control of their finances. Whether you are financially savvy or a spender who struggles, multiple bank accounts are worth trying!

Some specific groups of people that it may help the most though are as follows:-

  • People who need to control their spending
  • Children leaving home and living by themselves for the first time
  • People less able to understand their finances in some way
  • People who need to save / budget more

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Why several bank accounts are a great idea

Let me explain how this concept works

Budgeting always starts with knowing what your incomings and outgoings are – and this concept focuses on your outgoings.

Usually your outgoings can be grouped into 3 main categories – BILLS, SAVINGS and DAY TO DAY.


These would be any fixed expenses you have each week/month or even annually. For example:-

  • Mortgage
  • Council Tax
  • Electric / Gas
  • Water
  • TV License / TV subscription
  • Phone / Internet costs
  • Gym Fees
  • Childrens Classes
  • Car Service / MOT / Car Tax
  • Subscriptions and memberships

TIP – annual costs can be put in here if you save 1/12 of the amount each month – then you will always have enough to pay it and it won’t come as a horrible surprise.
TIP – Setting as many bills up onto Direct Debits can help to make paying bills a much quicker task each month and can sometimes save money with companies who prefer you to pay this way.


Anything you need to save for can go in here, things like:-

  • Pension fund
  • Large expenses (new car etc…)
  • Christmas
  • Holidays

Again as with bills, you know that Christmas happens every year, so it makes sense to save 1/12 of what you approximately spend at Christmas each month so when it comes round you have enough money. Same goes for holidays etc…

This sort of planning can also really help you to see whether you can actually afford to spend as much on things, giving you more control back over your finances which can only be a good thing.

Day to Day

Basically everything else that you need to spend on:-

  • Household expenses
  • Food
  • Petrol
  • Personal

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Set a minimum of 3 accounts in the above categories to start

Setting up a minimum of 3 accounts for these 3 categories can help by keeping you more in control of your budget and so that you are more aware of what you have available to spend.

Basically have your incomings set up to go into one of these accounts (I use BILLS as this is the most important of the 3 and your bills need to get paid first)

Then set up monthly direct debits into the other 2 accounts for the amounts you need to have in them (based on your own budget). These then become bills for yourself, and then you can forget about your savings until they are needed and just concentrate on your day to day account – where you only have access to what you need (and hopefully this coincides with what you can afford, but that’s a post for another day….).

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Do you need more accounts?

You may prefer to take this concept a step further and create extra accounts to further divide up your money, and this would be dependent on your own circumstances of course.

Some ideas would be:-

  • Split your DAY TO DAY account into PERSONAL and HOME
  • Split your SAVINGS into PENSION and CHRISTMAS and HOLIDAY etc…. so you can clearly see what you have for each

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Is it really worth it?

Yes, it will take a little time sorting this out, but I truly think that it  IS worth doing – for so many reasons:-

  • Helps you to understand and control your budget better
  • Helps to control your spending on “extras”
  • Helps you prioritise i.e. makes sure you pay your bills first, then save, then spend on other things
  • “out of sight, out of mind” – don’t have access to all monies at all times
  • You can put savings into better performing accounts to get better interest
  • Can help to placate people who don’t like the idea of a “joint account” as you can simply have “home” accounts and “personal” accounts
  • Saving for large spends is made easier

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Try it out!

Are you trying to organise your household budget? 2 or more accounts could make life so much easier - here's how...Why not try this system and see how it works for you, especially if you are living on a budget and want a little more control over your money.

Set up the 3 accounts BILLS / SAVINGS and DAY TO DAY first, and then add extra accounts as you see fit.


I would love to know if you do something like this already, so please leave a comment below – thanks in advance!



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7 Responses to Living on a budget – why several bank accounts can help

  1. Claire Meredith Jan 8, 2017 at 5:21 pm #

    Great post! I started doing his last year so that my self assessment tax bill wasn’t going to be as painful to pay on January 31st! Each month I put a set amount in to a “tax account”. It’s kind of like my own personal PAYE account for my self employed tax and national insurance.
    I’m now sure they’ll be enough to settle the bill. As a bonus the account it’s in has a good interest rate too so I benefit from that too.

    • Chrissy @ Organise My House Jan 9, 2017 at 5:31 pm #

      Hi Claire – that’s perfect! – exactly what helps make things easier when the bills come in. Glad to hear you have done it and it helped! x

  2. Chrissy @ Organise My House Sep 20, 2016 at 11:37 am #

    No problem Angelina x

  3. Nicole Jan 3, 2015 at 8:47 am #

    I’m too scared to go near a credit card, but I have 5 bank accounts, one for every day and weekly direct debits, one for bills like rego and phone bill, one for holidays, one for my future plans (2-5 years), and one retirement account. Its brilliant makes it so much easier, if it was all in one I would have spent everything I can guarantee (I’m a shopaholic)

    • Chrissy Halton Jan 6, 2015 at 1:34 pm #

      Hi Nicole – really glad that you use this method to such great advantage – thanks for sharing x

  4. Dan Dec 22, 2014 at 10:26 am #

    You only mention bank accounts – could you do the same approach, but using Credit Cards for different purposes – then pay off the monthly balance to avoid getting into any financial trouble?

    • Chrissy Halton Dec 28, 2014 at 6:49 pm #

      You absolutely could – just have to be very careful with credit cards as you said though as you wouldn’t want to suffer charges that would outweigh the advantages…

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