When times are tight and you’re struggling to manage your budget effectively, could the answer be jam jars?
Money is tight for most of us and it can be a real struggle to manage household budgets and keep clear of debt.
That’s why there’s been growing interest in so-called jam jar accounts. These almost always charge a fee but do much more than a standard or basic bank account.
Jam jar accounts manage your money for you. You specify what kind of ‘pots’ you need your account to contain and the account will automatically divide your cash up.
So, you might label one pot ‘bills’, another ‘savings’ and a third ‘spending’. Then the account only allows you to spend the money in your spending pot, giving you the reassurance that when your bills are due the money is there.
For years I've had what's termed a "Budget Saver Account" - which I suppose is something along the same lines. The bank gives you a form to fill out where you total up all of your projected outgoings (bills ) for the coming year. Then you divide by 12 and pay that monthly amount into the Saver account. You can have direct debits and standing orders handled by the account, so you don't have to actually sit down and pay your bills. It's all done for you.
That's why I have that account - because I have a bit of a mental block about paying bills on time - and before I had this account, was always in trouble over not paying bills.
As it happens, my bank has discontinued this facility. They have allowed mine to keep going, because I had joined before they discontinued them. I must say, I find that account a life-saver. You can actually run up an overdraft on it, just so long as you have everything paid off and are in the clear by the end of the year.