Odd Checking Account Question

[frugalcollegestudent]

Each month I have about 600 deposited into my checking account through direct deposit (through 3 different employers.) I also have at least another 4 or 5 checks I deposit myself plus some cash (college poker is one of my few vices, although I don't go over $20 a month.) I have 2 credit cards, one with a 3,000 limit and another with a 2500 limit but barely spend enough to have to pay a total of $150 between the both of them. With that being said, in any given month I really only need 200 in my checking account to get by.

So here's the kicker: I am your typical Apple computer college student who likes everything streamlined (quicken used to be my one-stop shop but now it just annoys me and I use excel sheets) and I wanted to know if there was a way where I could set up my checking account to have any amount of money that is in there over $200 automatically deposited into a third party savings account. Ideally this would ensure I have no money that I did not really need simply "sitting" in my checking account not earning interest for me.

Is this possible? It is very tiring to have to wait until the end of the month to have the rest moved over to savings while it could be constantly flowing over there automatically. Now I know what little interest would be earned using this system, but I am a firm believer in the saying a penny saved is a penny earned (in fact never has there been an occasion when I walked past a penny without picking it up). I cannot tell you how irritating it is to know that there is money in my account that I have no meaningful use for not earning interest for me, however minimal it might be.

[Spud]

It's not automatic, but I set up an Excel spreadsheet like this:

Current Bank Balance = X
Upcoming Expenses = Y
Bank Balance after expenses = X-Y
Comfort level in bank = Z
Amount to invest = (X-Y)-Z

Once a month I run the spreadsheet, and I sweep anything extra into our investment account via online bill pay from our bank. In fact I just did this today.

[zetta]

How about switching to an online bank that pays interest on the checking account? Etrade and ING come to mind.

[puck36]

Well I'll tell you what I did. I bank with Wells Fargo and have an online savings account with HSBC. What I did was set up automatic transfers two times a month from Wells Fargo to HSBC. I do two a month because I get paid two times a month. With HSBC you just do everything online and don't have to call or talk with anyone to set it up. I also have automatic transfers set up between my accounts with Wells Fargo and that was done online as well. So to answer your question yes you can set it up to auto transfer your money.

[Broken Arrow]

Hmm. Would it be easier to just use a credit card, even if it has a low limit? Then you can just park your money somewhere earning interest until it's time to pay off the card.

It might not be as easy for others who are tied to savings accounts, but I have a 5% interest checking, so operating this way it's practically effortless for me.... Direct deposit -> 5% checking -> Bill pay credit card.

[lucasrd]

just login on payday and manually do the transfer...tha'ts what I do and it takes about a minute....

[aida2003]

I bank with Wells Fargo and have an online savings account with HSBC. What I did was set up automatic transfers two times a month from Wells Fargo to HSBC. I do two a month because I get paid two times a month.

Do you have to pay anything for the auto-transfers between 2 different banks? What kind of transfers are they? ACH or electronic money transfers. I think usually banks impose fees on the latter one.

[jimmyengland]

If you have three paychecks totaling 600 and you know that you will only spend 200 why dont you just have the other paychecks deposited straight to a savings account.

If you cannot do that then deposit to checking and do an online transfer to your savings.

[frugalcollegestudent]

If you have three paychecks totaling 600 and you know that you will only spend 200 why dont you just have the other paychecks deposited straight to a savings account.

If you cannot do that then deposit to checking and do an online transfer to your savings.

I could, you are right. But rather than wait the few weeks and fill out the same paperwork to get the process rolling, I was seeking something more expedited that could be done in a day or two.

[jimmyengland]

If you transfer through online banking at the same institution it is in the other account immediately.

If you transfer from x bank checking to y bank savings it may take a little longer (im not too sure and may depend on institution and location).

Thats why I hold my savings and checking at the same bank.

[puck36]

Do you have to pay anything for the auto-transfers between 2 different banks? What kind of transfers are they? ACH or electronic money transfers. I think usually banks impose fees on the latter one.

I don't pay any fees. It takes 3 days for it to so from one bank to the other.

[Slicer]

I simply have my salary direct deposited to my online savings account. Then, I setup my savings to auto-transfer a predefined amount twice a month (1st & 15th) to my checking account for monthly expenses. Savings slowly gets bigger while I live my life on what I pay myself from the savings account.

My wife and I both do this and it works out really well for her because she's paid every other week (26 times a year) rather than twice a month (24 times a year). Before doing that, it was kind of a hassle juggling when she got paid and when the bills were due because the time during the month she received her check moved around during the year.

It's kind of a cool way to accumulate money and manage paying yourself when you want to be paid, rather than "when the check comes in"!