Bucketing your money - The better way to save and spend
28 August 2018
Christina Arrand is the Local Market Manager of the Suncorp Concept store in Paramatta, NSW. Here she shares her insights into using ‘bucketing’ as a concept to manage your money.
“I’ve met many customers over the years who say that money is one of the main sources of stress in their lives. We’ve found that often, the core issue is not that people don’t have enough money, it’s that they don’t know how to budget properly and effectively” says Christina Arrand.
“Aside from budgeting for bills, mortgage repayments and insurance, managing money can be even harder when trying to orchestrate a major project like a home renovation.”
What is bucketing?
Mentally juggling your funds that are sitting in one place is almost impossible for people who aren’t accountants, but there is a simpler way: bucketing.
The concept of bucketing involves splitting your money into various segments, referred to as ‘buckets’. Rather than having all your funds in one big pile, which can easily get out of control, bucketing gives you a way to separate your finances and have a clearer view of your saving and spending.
Organising your budget with bucketing
Sometimes it can feel like your bank account is like an international airport with money coming in, lots going out, all while trying to keep the balance in the sky.
Getting your money organised requires little time and focus, but it’s well worth it if you’re keen to give bucketing a try.
With the right tools, creating an effective and accurate budget doesn’t need to take up much of your time or energy. Start by deciding for what’s important to you – do you want to pay off debt, save for something special or invest?
Research and compare the prices of your everyday expenses, such as groceries, energy bills and regular payments – rent, mortgage, car loan – to know your outgoings.
There are a few online budgeting tools which can be a big help. Experiment and juggle using the online tools to help you figure out what will work best for you.
Once you know how you want to spend your money, it’s time to divide and conquer.
For Suncorp customers this can be done using the Everyday Options Account.
Everyday Options Account
By opening an Everyday Options Account, you’ll be able to open up to 9 different sub-accounts, none of which attract any fees, and name them according to your needs. You can transfer your funds as often as you like from each sub-account without any cost.
Sub-accounts can also pay you interest, which can help achieve your savings goals sooner.
Why try bucketing your money?
Bucketing is a practise that has been around for a long time, but with the introduction of internet banking and mobile apps, it’s become much easier to manage multiple accounts. Splitting your cash into separate piles limits temptation to spend money that’s allocated for another purpose, like bills or school fees.
“Many customers see their goals being achieved more quickly as they’re not dipping into their money as often as they might if it were all in the one main account,” says Christina.
Once your buckets are created, you can allocate it according to your goal, whether that be a holiday, renovation or fancy pair of shoes.
How to get the most out of bucketing
Bucketing is a great practise if you’re saving for a major project, but it’s also great for day-to-day living.
For example, most people know how it feels to get hit with multiple bills at once and having to manage which get paid in what order. This is especially common with energy bills and rates, or anything that’s billed quarterly. If you bucket your money using your sub-accounts, then bill-juggling can be easier to manage.
For example, for energy bills you could do this by creating a sub-accuont for each bill, naming them Electricity Bill, Gas Bill, Broadband Bill etc., or a create a main one named Utilities. Then you would transfer money into those sub-accounts when payday comes around. If you set up automatic transfers then it’s even simpler.
A good tip is to make sure you have everything linked to your internet banking and/or Mobile App, so you can easily access your money and keep yourself on track.
Another good tip around energy is to compare your rates a few times a year. Energy prices fluctuate, so it can be useful to review your changes and compare your energy plan against other providers.
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Christina Arrand is the Local Market Manager of the Suncorp Concept store in Paramatta, NSW. Christina started at Suncorp as a Store Manager in Bondi and has also managed the Liverpool and Campbelltown stores. Her role involves coaching and training Suncorp team members how to best help customers get the most of their money.
Information is intended to be of a general nature only and any advice has been prepared without taking into account any person's particular objectives, financial situation or needs. You should make your own enquiries, consider whether advice is appropriate for you and read the relevant Product Disclosure Statement or Product Information Document before making any decisions about whether to acquire a product