Saving Account?

[Ponkers]

To keep on top of our budget and ensure we don't overspend, we withdraw our fuel/food/living money and leave enough in the bank to cover the direct debits etc.

We then split the money into envelopes for the relevant weekly amounts.

However, I hate having money laid around the house - are we allowed to open a savings account to put the money into so we only need to withdraw that week's money?

[Judo]

Hi Ponkers.
Yes, you are allowed an account for savings. Anything you manage to save from your allowances you should definitely put away for a rainy day!

[Skippy]

Yes, you can open a savings account, and it's a good idea to keep your allowances separate.

[Ponkers]

That's great - thanks! I didn't know we could save anything left over, that is a big help towards months when there are bigger expenses (car tax next month, two lots of school uniform in august, christmas, etc!)

Wish I had known this sooner!

[Foggy]

Hi Ponkers. I am sure many of our experts would actively encourage a savings account. On one hand you have a useful contingency fund for emergencies and on the other it's building a healthier finacial lifestyle.

Strangely, it seems slightly more problematic getting a savings account at the main banks than a basic current account (I know not why). I now bank with Co-Op, who were happy to give me two cashminder accounts (or more if wanted), but not happy with a savings account! So I opened an e-saver with the Yorkshire Building Society (not bank), which can be run online and has a cashcard for withdrawals from ATM's.

[Ruth.mh]

I am thinking of using a savings account to put MOT/Car tax money in away from my main account. Would I need to declare this to my IP? Would want to see statements from the savings account? Is it possible for them to trace accounts in our names? As what concerns me is them seeing an amount of money in my savings account and then wanting it for my IVA even though its been saved from my i&e. I worry that it would like I didnt need to use the money and they'd try and take it.

[Foggy]

No, Ruth, unless they have specific cause to look for accounts they won't search for them. In any event, as long as the amounts saved match the amounts in your allowances and any shares of overtime and bonus payments, they will not garnish the money for the IVA.

For instance many IPs allow around £20 per month towards car repairs, so a sum of £240 in your account would be expected, if no repairs were required --- the IP will also appreciate that one year you might get lucky and save the £240 ---- and the next you could have a bill for £500 to get through the MOT..... swings and roundabouts.

[Ruth.mh]

Thank you