Not sure if this has been suggested before and I could not find anything matching my concept as such.
What about using pots for budgeting?
Currently for me to use this concept, I will have to keep £0 in my available balance. Each time I make a purchase I have to know the total of the purchase I’m about to make, then move the money from the Pot which makes it part of my available balance. Then make my purchase.
What I would like is my available balance to be a pot in itself. This pot would be the default for all card transactions. This could be achieved through the use of an “active” marker. This marker would in effect make any pot my available balance. Any subsequent card transaction would come from the “active” pot. Once a transaction is completed it could say revert to the default pot.
So let’s say I have 3 pots
Default
Food Shopping
Takeaways
Petrol
Each month I transfer my budgeted amount to each respective pot. When I need to fill up my car for example
Mark Petrol as my active pot
Fill my car up
Pay for the fuel
Rules set default pot to becomes active again.
Same applies for then you decide to go shopping after, simply switch over the active marker to your food shopping pot and spend from there.
The ability to move money between pots and report on it would also be advantageous. Spend less in one pot allows you to increase your budgeted amount in another without adding any extra money overall.
Now as I understand it a rules engine is on the roadmap which would let you have DD come from pots. This would eliminate a situation where you switch your active pot to buy a cheeky pizza at the same time your mortgage payment comes out.
I like the idea of linking certain payments to certain pots. Shouldn’t be too hard really but you may get some anomalous transactions in the wrong pot (i.e. your groceries pot might be used when buying a TV from Tesco).
I think in those situations I would just make two separate transactions like I do at the moment. That said its a great point.
What about having the ability to multi-select pots at the point of purchase? Then enter in what amount will be drawn from each pot. Would take 2 secs to confirm the price of the TV then select X amount from tech pot, rest from groceries pot.
Currently, I do all this budgeting post-purchase using money dashboard it’s great but tiresome. Moreover, it relies on you to check your budget pre-purchase and to not overspend. My suggestion is almost the virtual equivalent of splitting your paycheck into envelopes of cash. Nice and simple.
I think the idea of having an “active pot” for debit card payments is a good idea. It would be good for a number of things, holiday etc. I guess if you wanted to go to the effort of changing pots everytime you make a purchase then it would also work for that too.
I’d personally get sick of having to access the Monzo app for every purchase, it would get old very quickly. Just picturing myself having to do this everytime I fill up on petrol its already starting to annoy me.
Yeah totally get what you mean and kinda agree. I just have to do budgeting all the time and I loathe doing it in the evenings. This would be lesser of two evils in my case. Nip it in the bud at the point of purchase.
I’d also be interested in selecting an ‘Active pot’ from which to charge money to. I currently use Monzo for my ‘Fun money’; every month I transfer £300 to my Monzo and that’s my spending money for the months whether it’s clothes, take away, eating out, pub etc.
While I can allocate a target to things like ‘Eating out’ I don’t want to set a separate target for eating out and one for shopping. So it’d be great to have a pot which keeps my spending money in one place.
I would love the idea of a “discretionary spending” pot, although once DDs are available from pots, this would be the reverse (keep bill money in the pot and spending money out).
I do have a separate Tobacco pot (I’m trying to cut down), so I allocate funds in there, and each time I buy some I move it back into my main account, and that way I’ll see when that pot has gone.
I think an option (to manually switch on/ off) to force limits in the budget categories may be interesting here. We can budget for things easy enough but sticking to them is the hardest part, so once all money spent on takeaways for the month, it would actually give a notification or even decline future takeaway payments (unless I went in and switched the option off/ amended budget). Would certainly make me think about where my pennies are going.
Love the idea of having Pot mobility and switching between different Pots for certain spending I think this would take a lot of work but potentially worth it in the long run!
Is there anything in particular that people find tricky about moving money around their Pots at the moment?
I have to do exactly the same, it would definitely be easier to move money directly between Pots! It makes more sense. Hopefully this is something brought it shortly
Personally think this is a great idea. The amount of separate things I need to keep tabs on but spend on a regular basis, this would massively help. It may seem a pain in the ar*e to some, but I think if it became a thing, people would soon see the benefits. Plus, like everything, once up and running, it would only improve
If we break this down further, we can think of the ‘default’ account, the main balance, as just another pot. Sort of an “un-allocated” pot.
So EVERYTHING in Monzo will be happening in pots, and we could have different setting for each of them (charge pot A for transactions from this retailer and pot B for transaction from this retailer, automatically allocate X amount of money from pot 1 to pot 2 every month, etc).
Pots are no longer a side feature for a specific purpose, and instead a fundamental part of how money is handled in the app.
I’ve been thinking of something like this for ages.
I think the ‘active’ pot works best. (For me) - when I go on holiday, I could just switch the active pot to my holiday fund, or equally when I go for a night out I could spend from my ‘night out’ pot and easily see when I’m running low.
For the idea of select on a per transaction basis, I think the best would be to have a ‘refund from pot’ button - so I can pay back the amount from another pot. Otherwise the transaction will be held up pending me choosing the pot, which could be painful (what happens if there aren’t sufficient funds? The authorisation can’t go through till the pot is chosen, which will get confusing)
For me, using pots for budgeting is the killer feature that I’ve been looking for from a bank for literally 20 years.
The way I’ve managed my money has always been within traditional current accounts, combined with some kind of offline system that would provide me with the notion of pots. Essentially I always know how the total money in the account is shared out between pots. For example, I’d look at my bank account and see a balance of £1,000, but I’d know that £200 of that is for energy, £100 for council tax, £500 for grocery spending and £300 for holiday savings.
The way budgeting works with this system is to have a ‘holding’ pot which all the income is allocated to, then every month I would transfer out the budget to the relevant pots. These pots are then where direct debits etc. would leave from.
I’ve used all sorts of methods to administrate this over the years (Spreadsheets, GnuCash, custom software) but the bookkeeping side of things has always been really labour intensive and boring. However the fundamental concept of using pots as a budgeting tool is really powerful and works really well.
I’d love it if Monzo adds the missing pieces so I can finally stop having to do so much data entry!
If you have a holding pot but then transfer out £12.50 to a TV license pot, £22.00 to a Sky TV pot, £15.00 to a mobile phone pot…why not just have a direct debit pot and put £49.50 into it?
I really like this idea, I like the concept of being able to squirrel money away into a pot for something like a holiday, as an example.
When I actually do go away for a holiday, I would then set that pot as “active” and whenever I made a transaction, the money was taken strait from there. This would be super useful for making sure I stay on track with my budget for the trip, and seeing if I’m not!
I’d also love to be able to automatically move any remaining balance at the end of each month into a pot, though I’m sure there’s another thread somewhere for that.
I think this would take a lot of work but potentially worth it in the long run!
