Why having different accounts for different expenses can make your banking smarter

Tayla Gentle, originally published on Pedestrian TV
If the past couple of months have taught us anything, it’s that nothing in life is certain – and yes, as many of us found out the hard way, that includes finances. If there’s ever been a time to start being savvier with your funds, it’s now. So, let’s have a look at a little term called ‘bucketing’. This article was originally published on Pedestrian TV Australia.
Pedestrian TV logo Tayla Gentle, originally published on Pedestrian TV

Using buckets to budget

We're not talking about buckets to separate your whites and colours in the laundry – bucketing is actually a style of budgeting. Even if you’re not thrifty or good at maths and are all-round the opposite of a financial prodigy, you could find it quite a banking no-brainer to get around bucketing. It can be simple, efficient, and you can even make it a direct debit. It’s like the old school envelope budget. You know, when your mum or dad would stuff cash in different envelopes – one labelled RENT, another labelled EMERGENCY, the third labelled BIRTHDAYS etc.

The envelope system seemingly worked for mum and dad because it ensured they had all their financial bases covered. For example, they could always keep a roof over your head, clothes on your back and fish fingers in the freezer.

But even if you don’t have kids to house, clothe and feed, bucketing is still a super useful way to manage your money, and right now could be a stellar time to start. But how does one begin bucketing?

Become a bucketing guru

Choose your buckets

First off, decide on your buckets. Are you paying rent or a mortgage? That’s usually a bucket people create. Saving for a post-COVID holiday? Why not give that its own bucket? Life essentials like groceries and bills? Probably worth a bucket.

Everyone’s buckets will be different, because everyone leads different lives. The excellent thing about bucketing is you can easily rename and shuffle your buckets if your priorities shift. Flexibility and freedom – we love it.

Get out your calculator

This is where we crunch those numbers and do that maths. It can be useful to decide ahead of time what percentage of your income is going into each bucket. This can take a little adjusting over time, but stick with it. If you’re super stuck though, there’s always this nifty budget planner you can try which basically does it for you.

Make it work for you

Got lofty budgeting goals? Firstly, go you. It's great to aim high. Secondly, you can use nifty tools, like savings goals in the Bankwest App, to create your goal, schedule regular payments and track your savings progress – all in one place. You can also set up direct debit payments into your buckets if you’re a little forgetful. Make the technology work for you and your money as a banking no-brainer.

Anyway, if you want to break your splurging habits or quit spending your entire paycheck on food delivery services, bucketing might just be the way forward – best start saving.

Keep reading

Check out the other articles that are part of this content partnership below, or see our range of other handy guides.

Learn how to pick up habits that can help you save more.

Find out how to manage your money the moment it hits your account.

Get some handy tips to manage the subscriptions linked to your account.

Find out which of your bills you might be able to negotiate, and how to do it successfully.

Learn how to save, no matter how your account’s looking.

Learn some handy tips that could help bump your tax return.

Need help?

You can message us in the Bankwest App or online banking, or call us – we’re here 24/7.

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The information contained in this article is of a general nature and is not intended to be nor should it be considered as professional advice. You should not act on the basis of anything contained in this article without first obtaining specific professional advice. Also to the extent permitted by law, Bankwest, a division of Commonwealth Bank of Australia ABN 48 123 123 124 AFSL / Australian credit licence 234945, its related bodies corporate, employees and contractors accept no liability or responsibility to any persons for any loss which may be incurred or suffered as a result of acting on or refraining from acting as a result of anything contained in this article.