I am graduating this year and ready to adult (I hope). However, can someone help me to sort out my accounts please? - Seedly
 

Savings

Expenses

Fresh Graduates

DBS Multiplier Account

Standard Chartered JumpStart Account

Savings Account

Asked by Anonymous

Asked on 22 Jan 2020

I am graduating this year and ready to adult (I hope). However, can someone help me to sort out my accounts please?

My savings are now down to $4k because I've been supporting myself for awhile now. I read that it is better to get 3 different types of account—savings, expenses, short term savings. Would like to know what are the recommendation you guys have? Is it okay to use DBS Multiplier as both Savings & Expenses?

I am now separating them to

  1. Savings — DBS Multiplier

  2. Expenses — DBS Multiplier

  3. Short Term — SCB Jumpstart

Thank you!

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Hi anon,

I'll just share my own way of doing my expenses to give you an idea:

  1. Salary to OCBC 360 to satisfy salary crediting (no other requirement to get the extra interest, which is good for me)

  2. A fixed amount transferred to POSB to spend

  3. Rainy day fund in CIMB due to the high interest without any requirements

Of course, you'll have to go through the hassle to set this up, but once done, transfers between bank accounts is pretty much instantaneous. You can of course use one account to satisfy both savings and expenses, but then you must know how to manage it well.

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Serene Toh
Serene Toh
Level 6. Master
Updated on 30 Jan 2020

With just $4k it might not be worth your effort to split into so many accounts.

Do note that there are min amounts to keep in most of these accounts. If you go below there will be a fee charged to you.

The disadvantages of having many accounts are;

  1. lessen the free cash you have to use, without incurring charges, if you go below min amount.

  2. Less interest received. With multiplier accounts, likely you can only fulfil the requirements of 1 account and not all accounts to get the best interest rates.

I will suggest you find 1 account that can have you the best interest rates, and use it to accumulate wealth to a meaningful amount before splitting into different accounts.

In mean time, you’ll have to monitor your expense, old fashion way, on excel sheet.

If you are really afraid of overspending, then either use the envelope method by withdrawal cash for you expenses or find an account with no or really low min amount.

For me, I’ll try to accumulate to say $50-70K before getting another account.

I used to like OCBC because you can allocate saving goals and ‘“lock” in an amount so it won’t be available to withdraw at the ATM. So that 1 account can effectively function as several accounts. Left because the interest isn’t that good compared to others.

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Firstly, we need to have a complete understanding on our cashflow. Through this process, we will understand our earning ability and spending habit. Here is a guide to help you: https://www.blog.pzl.sg/understanding-your-personal-cash-flow/

Next, I will suggest for you to have a maximum of two bank accounts for budgeting. The best way to do this is via automation and this is how I do mine: https://www.blog.pzl.sg/how-to-create-a-monthly-budget/

For the salary account, you may consider one of the high yield salary crediting accounts like DBS Multiplier or UOB One. Either way, do your own analysis by understanding your cashflow and choose one that fits into your needs.

For the expense account, Standard Chartered JumpStart works well or another other accounts with zero minimum balance works fine.

If you plan it right, you won't need three bank accounts or bank accounts for three purposes. In your case, if you were to plan savings and expense within the same account, then there exists temptation to use more money than you actually need. (Check the post on how to create a monthly budget for more details.)

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