The Briefing

The smart way to use your sub accounts

Bring order to your banking!

June 2, 2022
Reading time 2 min.

💎 Why do I care?

  • We all know creating your own sub accounts – we call them pools – is easy peasy. But if you want to really get the most out of them, then there's a special method you should know about.
  • Ever heard of the 50-30-20 rule? It might sound uncool, but it's super useful.
  • If you know how much you earn each month, and what your fixed monthly expenses are, then you’re one step closer to having a really good financial overview and more better control of your finances.

First, calculate your salary

To get the most out of your sub accounts, the first thing you want to do is figure out what your total monthly income is. This includes everything from your salary to financial support from your parents, birthday money, and the money from Vinted when someone finally buys your Nikes.

When it comes to your salary, remember to only consider the net amount (which is the amount you receive after taxes have been deducted).

Create the first pool: Fixed expenses

Once you know your income, create a pool to cover your fixed expenses. These include your rent, utilities, subscriptions, wifi, mobile phone, public transport ticket and everything else that you pay for each and every month.

When it comes to the average person, about 50 percent of their income will go on covering their fixed expenses. That’s the first part of our 50-30-20 rule!

Why create a pool for your fixed expenses? Because then you know you’ve got them covered, and you won’t accidentally spend it on shopping or partying 🥂. BTW, once you know what they amount to, you can set a rule to automatically transfer that amount into your fixed expenses pool each month. Pretty cool, right?

One (or many) pools for lifestyle

The 30 in the ‘50-30-20’ rule is for lifestyle — so you can spend 30% of your monthly income on things like dating, sports, clubbing, online shopping — all the things that make your life more enjoyable!

However, you could also choose to leave part of this leisure money directly in your main account, and then use that as a monthly allowance for everyday odds and ends.

One (or many) pools for life goals

These are definitely the coolest pools, where 20% of your monthly income is set aside for your life goals.

Of course, you need to start by defining what these are. You can think as big or as small as you like. Your next big travel adventure or soda stream for the shared kitchen? No matter what they are, you can create different pools and easily see how much more money you need to save in order to reach your goal. Once the savings goal is reached, then you’re ready to go out and tick off one of your life goals — and you can pay for it directly from the respective savings pool!

🔥What does this mean for me?

  • Take 2 minutes (using mental arithmetic 🥵, or by using the calculator on your mobile phone) to work out how much income you receive each month, and what that money goes on.
  • Spend a few minutes dreaming up your life goals, and thinking about what wonderful things you could do with the money in your leisure sub account.

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