Here's a simple but useful tip:
Have a separate account where your income comes in and from which your recurrent bills are paid, and another one you use for payments done in person (like in stores) and to withdraw money.
Then, arrange for an automated weekly transfer to this spending account for a sum that ought to do it give or take with your usual expenses. Then, when needed, transfer individual sums of money between them.
Don't carry the main account card on you, always use the spending account card for that kind of stuff.
Not only is this useful to keep better track of your expenses but if the card on you is stolen, or you are made to empty out the ATM by a thug, it would be BAD if that was your main account with your income and all the automated bills etc. With the spending account card though you will lose at most a week's money and a bit on top of that, and you'll be saved a TON of paperwork with diverting all sorts of automated bills to a new account in case the old one needs to be blocked.
Don't put all your eggs in one basket is what I'm saying. Aside from your investments, savings accounts and what you might have, have a seperate account for income, bills, rent and whatnot which you leave at home, and a separate account + card you take with you for expenses made in person.
Even if you don't have much money, this can help get your spending pattern under wraps better, and may save you a ton of grief.
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Edited by Asante (01/04/08 11:22 AM)
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Not a bad idea. However, just to play the contrarian argument and suggest some things to look out for...
I would hate to see myself being stuck with my "spending" card, forgetting exactly how much cash I had available in that account, and potentially overdrawing it which would result in penalty fees. If that did happen, hopefully I would learn my lesson. Also to note on ATM theft, all the banks in my area put a limit on ATM withdrawals that is around $300/day... so there is already some protection in effect against theft at the ATM itself.
Lastly, I prefer to use credit cards over debit cards for my spending, as you can cash in on some significant rewards if you are smart and able to pay off your balance each month. By making gasoline purchases on my Discover CashBack Bonus or Amex Business card, I get 5% of what I spend as a free cash return. I also get 5% back for FedEx purchases (which I use for business all the time) with my Amex Business, and 3% back for restaurant dining on my Amex Costco Business card. These are not shabby rewards, and I'd hate to miss out on the free money by using my debit card.
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