One of the things when we set out to do this was hopefully to meet like minded young couples out there to share our experiences and to learn from one another on all things personal finance.
Of course, for all couples, there will undoubtedly be joint accounts involved. There are various ways of managing joint finances. For Mrs Budget and myself, here’s how we deal with our joint finances.
Both of us are currently on the DBS Multiplier Account as our primary day to day account.
The reason why we chose DBS multiplier is because we can hit the second highest tier of transaction category to get at least 2.2% of annual interest rate for our savings account.
What that means is that, with our salary credit as well as fulfilling the credit card spend and investment spend, with a total eligible transaction between S$5000 to S$15,000 (including our salary), we will be getting 2.2% interest rate per annum.
To put that in context, if we have S$50,000 in our account, 2.2% of that will translate to S$1,100 in interest rate per annum.
To us, that is a decent interest rate, especially if you compare it with the recent Singapore Savings Bond which only returns 1.75% pa if you hold it for 10 years, and 1.64% pa if you only hold it for 1 year.
To fulfil the credit card spend criteria, we just need to spend at least S$1 on a DBS card. We are currently using the Live Fresh card, which we use when we dine out, for our groceries purchases or for any online transactions.
To fulfil the investment spend criteria, we regularly invest if we can, and the dividends from our stock and Reits holding as well as the coupon return from our Singapore Savings Bond will be credited back to our Multiplier account, all of which counts under the investment spend criteria of the multiplier account.
So while we have our individual accounts, we each contribute S$1,000 to our joint account every month.
Our joint account we registered is the UOB One Account, as we are also holders of the UOB One credit card. With that, we are able to get a 1.85% pa for our joint account.
For our UOB One card, we are using it for big ticket items (wedding, furniture etc), Grab charges as well as for our SP electricity bill, all of which gives us rebates for using UOB as the preferred credit card.
Here’s the money flow from our individual joint account to the join account:
For Mrs Budget and myself, we adopted a “claims” system, where every household expenses will be paid using our personal card, and at the end of the money after reconciliation, we will claim those amount from our joint account.
For example, we pay for our groceries using our Live Fresh card (to get up to 5% from that card), and then end of the month, we transfer that amount from our joint account to pay off the credit card.
So in that way, UOB one is not really a wealth building account since we are using our DBS account as the wealth building and accumulation account.
When our UOB account is running low, we will then make additional top up as and when it is needed.
As our bank balances are hovering around S$50,000, it is quite hard to hit the 3.88% tier for UOB One account.
Although we can combine our bank balances and get a higher interest rate, it is quite hard to split the money after that, and perhaps more importantly, the Mrs and I are used to having our individual bank accounts.
If we do hit the S$75,000 bank balance individually, we might just shift over from our DBS account to the UOB One account. That might just be my personal short term goal! 🙂