Who in here uses the 2 checking account system? I use a checking account for expenses, and one for everday spending. I'm curious to know the different ways people are managing cashflow

I have several checking accounts, actually, though a few are "just because" at credit unions. I break mine down mine like this...

#1... My "mortgage account". I have half my mortgage payment (paid bi-weekly) direct deposited into this account to keep it separate from my other money. Then I pay the mortgage from this account monthly. It gets little use, basically the mortgage only.

#2... My "primary" account. This is for all other bills and spending money. The balance of my paycheck is direct deposited here.

Separating it this way helps me keep things in line. Not everybody needs these little tricks, but it works well for me.

#3... My PayPal checking account. I so totally distrust Paypal that I have a separate account just for them. I know they supposedly can't dip in like they used to, but I still distrust them. I'm not taking any chances.

Three misc CU accounts, but mainly as either back-up and/or to have an established relationship with local CU's for other purposes.

All accounts are free.

I think trying to manage that many accounts would get me lost, but I applaud you for being so organized and have a system in place that is maximized.

While I keep all our historical data in Quicken, I maintain a separate cash flow spreadsheet for our primary checking account. Since just about everything goes onto our CCs, the anticipated cash flow reflects the monthly budgeted amounts for each card, plus the few items we pay by check. It's never exact, but I rarely need to pull from savings.

I have a checking accounts with every bank in town (small town), but only three active checking accounts.

Local Bank #1
1. Business Checking
2. Personal Checking

Local Bank #2
1. Personal Checking for auto loan payments.



I use my business checking account for direct deposit affiliate payments from my website.
Google and our appliance parts affiliates drop there payments in there once a month.

Our server cost are automatically withdrawn from the same business checking account.

Our personal checking account has our paychecks direct deposited and is used for monthly utilities and other cost of living expenses that come up during the month.

The second personal checking account we only use for our auto loan payments. We shopped around at the local banks for a car loan and this bank gave use the best rate. Of coarse it was the only local bank we did not have a checking account at.

We did not have to open up a checking account for the auto loan, but by doing so and setting up auto payments we got a little better rate on the loan, so we did.

We only use the checking account for the auto loan, but keep enough of a balance in there to cover a extra payment, just in case we forget to deposit money that month for the monthly auto withdrawal.

I have a main checking account at a local bank that I funnel all money through, since I can deposit a paper check easily there. I don't really keep money in there. I charge everything through credit cards except for the rare few things that I can't do that with. Then I pay them off from this checking account and move any access to my ING savings account.

I also have an ING checking account that I use on the rare opportunity that I need an ATM, because there are tons of free ATMs for it, and if it's not a free ATM, at least ING doesn't charge me an extra 2 bucks like my local bank does. It also has free overdraft line of $165 bucks so I don't have to keep money in the account to go to the ATM if I need to do it when I'm not expecting it. I can just go, and then transfer money from another account when I get home.

Over the years I have learned to streamline my system. Here is what works for me:

With 1 Bank since I was 18, but hold CCs with all major banks and 1 CU to have relationships if needed.

I use 1 primary low-interest bearing checking account which is my money "hub" and for direct desposit. This same checking account is linked to a regular low-interest bearing savings account where mortgage payment is debited only and a small EF is stored for immediate access.

Also linked is 1 outside MM Account where a larger EF is being funded for 48-hour access to funds.

All other expenses are charged to 1 Cash Rewards CC and one payment in full is made each month.

So basically I perform 2 transactions a month [pay CC & transfer funds for mortgage to be paid], the 3rd [funding MM] is on auto pilot.

I have 2 checking accounts. One is for covering most day-to-day expenses, and the other is dedicated to debt repayments.

I have been doing this for several months now and feel it works well for me.

My employer keeps three accounts, deposits, payroll expenses and non-payroll expenses. About the only good thing I can say about it is that it makes the life easier for the person reconciling the accounts. Other than that, I move money around regularly, and when cash flow is tight (when isn't cash flow tight in the non-profit world?) it's frustrating to have the money to pay a bill in one account when you need to pay it out of another account and there's no one around to sign a check.

If I could move the money electronically, I think I'd like it a lot.

How come you can't move it around electronically? most banks and credit unions have ach transfer these days.

1) BofA - To Transfer money to NFCU from paycheck (no direct deposit offered thru employer) and to rack up Keep the Change. Keep the Change personal contributions -> NFCU Savings
2nd BofA checking as I met the yearly contribution from BoA for Keep the Change on 1st account ($250).

2) NFCU Checking/NavChek - All Bills through Billpay, any personal checks, auto loan ACH through USAA

3) US Bank - Personal loan through NFCU, auto each month

4) Chase - Signed up for bonus, personal loan through local credit union, auto each month

We were assured that we would be able to do ACH transfers. By all the banks involved. But you need a merchant account to make ACH transfers work, and the fees were exorbitant. So our deposit bank decided to just waive all the fees associated with extra transactions, and to cut us certified checks when we needed them with no fee. I think that they'd do outbound wire transfers with no fees as well.

It's a little more running around, and a little more advance planning, but since the banks are all within a few blocks of each other, it's doable. I also got all the banks to agree to no holds on our checks.

I have 4 checking accounts, but two that I use primarily.

#1. I have a primary account into which goes my monthly paycheck, travel reimbursements, and any other check deposits. From that I pay for groceries, gas, credit card bills, and a few other variable expenses. But I also transfer a chunk of money to a second account shortly after payday.

#2 I use this second account to pay for all the standard recurring monthly expenses that can be scheduled & paid automatically -- insurance policies, car loan, subscriptions, etc. So it's fire-and-forget: once a month I move money here, and all those bills will be paid.

I do this because I only get paid once a month, and I don't leave extra cash sitting in my checking account. So I disliked having to keep account of upcoming schedule bills when balancing my checkbook and checking balances; this way, I don't have to worry about overlooking something and getting dinged for NSF. Also, every monthly bill is paid or accounted for within a couple days after payday, so I don't have to waste time during the rest of the month paying bills and keeping my books.

Unless one has to keep BUSINESS SEPERATE FROM PERSONAL I see no logic

My MRS has a seperate checking account for play

Otherwise 100% of the bills are paid from the joint checking account that I have and manage

A few decades ago I made all the deposits to the SAVINGS ACCOUNT and moved the money to the checking account as needed

But for some reason they don't like people who do that now

Like it is fraud or something

LIKE TAKING MONEY OUT OF YOUR LEFT POCKET AND PUT IT IN YOUR RIGHT POCKET IS MONEY LAUNDERING or SOMETHING LIKE IT

That's due to Federal Reserve Regulation D requirements.

It is important to how banks properly calculate their reserve requirements. There are different requirements for savings or checking accounts. It's to prevent the bank from having the reserve requirement of a savings account (lower) but the potential liability of a transactional account (more frequent withdrawals thus a higher reserve is required).

The restrictions have been in place since pretty much the 1930's -- but historically people went to the bank in person and those types of transactions aren't limited. It's automated, pre-authorized, and electronic transfers and debits that are limited (anything that is basically using a savings account as a transactional checking account).

So perhaps you want to make the same number of withdrawals/transfers as you always have, but now you're doing it via telephone or online transfer and become subject to the 6 transaction limit.

I would probably not use a two checking account system if I had ample amount of credit cards to manage my cash flow, but since I don't I use this system, and to be honest it works pretty well. I get points from the everyday checking and I get 10cent per paperless payment in my expense checking so I'm making a little bit of money. I'll probably change this system once I have credit cards.

DH and I have 3 checking accounts. Our main checking and we each have a checking that is for our spending money. DH had a habit of checking the balance online and not thinking/asking about outstanding checks so we moved to this system. All money goes into the main checking and then a set amount is transferred to our spending accounts. Our main account is at a local CU and our spending accounts are through USAA.

She only uses a check if they don't take VISA/MC/DISCOVER...

Otherwise she uses a credit card

There is no possible way I could overdraw her checking account (since I don't use it)

I hate writing checks. I use my debit card as much as I can and cash for what I cant

That's good to know.

yup.

also, never deposit checks into your savings accounts.

Good to know...

I don't but ... why not?

savings and checking accounts have different rules on when funds can/have to be released to the consumer. in general, institutions can hold funds deposited into savings longer than those deposited into checking.

I did...it didn't hurt

Only do it assuming you can't use the money for an extended period of time

You let any "HOLD" be with the savings account instead of the checking account

NO BOUNCEED CHECKS CAUSED BY A DELAYED DEPOSIT

well if you have direct deposit, than the "extra" hold doesn't apply

I am not talking about any DIRECT DEPOSIT

I am talking about a check from somebody you might not really know

Maybe you did some work for them and you agreed to take a check from them

Maybe your AUNT bounced a couple checks in the past

Put it in the savings account

YOU FEAR USING A SAVINGS ACCOUNT FOR ANY DEPOSITS OTHER THAN CASH...not my problem

Same here. I make all my deposits to a local CU and move money to USAA as needed to use with the debit card.

I don't fear using a savings account at all. I've deposited many checks into my savings and it clears in the same amount of time it would take a check to clear in my checking. my guess if you are seeing it differently it's time to change banks

I also never experienced a difference in time frames when depositing into either account types in any form DD, check, ATM, teller, transfer, etc.

This is news to me.

and moreover, shouldn't this be something consumers are made aware about? and without SOMEONE coming along and implying that I am paranoid? I was merely pointing out the difference not telling people to run scared. there are some around here who hate the idea of an informed consumer.

I apologize for trying to inform consumers of difference regulations regarding the availability of funds based on account type.

Yeah, I have about had it on your information spreading.

No, but seriously, I am just saying I have never experienced this hold, and as you can see from my earlier post I use my savings account linked to my checking regularly...that is not to say these regulations do not exist, but they just havent bit me in the butt on my transactions. Maybe I am special, but I doubt it.

Heg, I wasn't implying you were being paranoid, I was merely posting a response to what George said and my experience with check cashing and depositing.

some institutions might not hold but there are different federal REGs on the two types of accounts that can allow an institution to hold deposits into savings longer than those into checking

IIRC it is REG CC that applies to checking accounts but for savings accounts a bank can put a hold as long as 30 days for any reason on checks deposited into it.

some fools might not think 30 days matters to some of us...