I like this method as I know each of my bills and that they will be constant each month and my spending money will be a set amount each week. My bills do not fluctuate, except around April when prices rise and I have to adjust them. I’ve ensured they are all fixed, even utility bills. Why should I have to continuously check when I know how much my bills will cost? I can quote them all and the costs if needed. The app will warn me if I somehow have no money. In reality, will I check up on them? Of course but I don’t need to worry about them.
I just focus on spending my fixed budget per week on what I enjoy as well as saving the rest. This method got me out of debt and, over 6 years, to have savings over £20k towards my house deposit.
Exactly, Monzo already warns you if your direct debit is going to be more than last time, all it needs to do then is warn you if the money in your pot wont cover it. However if i put in enough money every month to safely cover my bills and my bills rarely change then its a perfect situation for an app to manage. If ive signed up for a direct debit i know what im spending.
It was the entirely automated banking part whereby the bank manages your money for you that I was referring to. Not this single idea of a direct debit pot
I mean if my salary is paid in and im sending money to savings automatically, money for bills automatically and leaving the rest in my account for spending and then sweeping it at the end of the month into my savings pot, its pretty close to being automated. At least the bits that matter.
Just saw the last section you added, thats awesome man. Its exactly why i want this feature. If i can stick to my weekly budget and not have to worry about anything else then theres no way that i wont end up with savings and no debt!
For me it has nothing to do with friction. It’s good money management and convenience. I’m making a clear distinction between money I can actively spend and money I’ve committed to spending this month or in future months. The same way (ignoring interest gained) we like to distinguish between savings too. The convenience is that I don’t have to check if all my bills have come out yet to identify what my ‘true’ balance is, etc. I used to just have 2 current accounts, one that just had money transferred for bills and then my main account I used for daily spending.
