Previous Stupid Bank Tricks
I enjoy strategies to use the banking system to your advantage. With this in mind, I have written a few articles on Stupid Bank Tricks.
- Real World Example: Kids Allowances. An early article pointing out how you can automate your kids’ allowances, using the bank.
- A Quick Brilliant Savings Tip was done by a co-worker. It is not really a banking trick, but still fun.
- Pay Yourself First outlines how to spread your money around using your payroll system.
- I have set up an account to not have to pay ATM fees, it worked for a while.
More Stupid Bank Tricks
A co-worker told me about a stupid bank trick (with my apologies to David Letterman) that has helped him a few times. This one struck me as particularly good strategy.
Create a bank account where deposits will go. Deposits such as,
- Pay cheques
- Tax Refunds
This account is solely in place as a deposit point. The account information is given to your jobs payroll department and the CRA.
The strategic part is to have a working account which scrapes this account, to build up funds for do day-to-day banking. This account is banking main street, where bills get paid, cheques written, groceries paid, and other normal banking tasks.
Why separate these two accounts? In the case of my co-worker, he found out he was going to be “Phoenix’ed”, as something had gone wrong with his pay, and they wanted to take back money from the account. His “scraper” functions had already taken the money from the account, so his wages could not be taken back, as there were insufficient funds in the account.
Why This Strategy ?
Compartmentalized bank accounts is an interesting idea. I have done this for saving, but had not thought of the ramifications of a “scrape back” on my account.
I assume there is a way to tell your bank not to allow withdrawals from your account by specific folks? This is not a topic I had ever thought about.