How to Make Direct Deposit Work For You

Budgets… OMG! I know every business, investment, frugal, financial freedom guru pushes the concept of budgets, budgets, budgets. But seriously they are boring to me.

Do you see money in your bank account and immediately think about what to spend your money on but know you should have a budget?

Here is a simple and easy solution. Have 2 bank accounts.

Bank account one:

  • Totally inaccessible or just a pain in the ass to withdrawl from. No debit cards allowed!
  • Add up all of your monthly bills multiply by 12 to get your annual expense. Then divide that number by the number of paychecks you receive in a year. For example, if your cell phone is $50 a month, that means you spend $600 a year. You need to put aside $23.07 a pay from your biweekly paycheck ($600/26). Automatically have this amount direct deposited into this account.
  • Pay all reoccurring bills from this account.
  • Add more than the money necessary to pay your bills.

Bank account two:

  • Easily accessible with a debit card.
  • You pay for groceries and incidental expenses like gas.

After you set up your direct deposit according to this “budget” system, it makes life so much easier. You will automatically see less in your easily accessible bank account and spend less. Personally, I put the least amount possible in this easily accessible bank account.

Happy fake budgeting to you!

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