How I manage my multiple bank accounts

Here’s how to manage direct debits and cycle money to get current account perks.

From cashback to monthly rewards, there are all sorts of incentives and freebies you can get with multiple current accounts. And don’t forget bank switching bonuses.

Plus there are benefits in terms of security and budgeting (read more about these in my why you should have more than one account article).

But the more accounts you have, the more admin is required. Plus many account switches and perks require extras like direct debits or minimum deposits each month.

All this can put some people off. But it’s actually a lot easier to manage than you’d imagine, and I think the reward is well worth the effort.

Regular readers will know I have 15 different current accounts at the moment so I’ve got to have processes in place to make sure I don’t accidentally go overdrawn on one or miss out on a perk on another.

Though it’s unlikely you’ll have this many accounts, the things I do will still work for you.

And the good news is that the admin can be done on one go early on, and then looks after itself!

Watch this video or keep reading (or both) for how I do it

Managing direct debits

Quite a few switching offers and perks require a couple of direct debits each month. Often it’ll say “active” direct debits, which technically could include any payment that has been taken in the last year.

But for the most part these direct debits have to come out every month to qualify – ruling out annual or quarterly payments.

I think you’ll need between eight and 12 ongoing direct debits to take full advantage of the offers. Though you can switch them from an old account it’s probably easier to manually set up new direct debits with the service provider if you’re moving money to different accounts.

And if you run out of the obvious direct debits, there are a few easy ones you can set up which won’t cost you anything.

You won’t need all of these accounts, but just to give you the full idea, here are the account perks and switches that require direct debits.

Switching bonuses that require direct debits

A decent number of banks offer free cash or rewards for moving your old account over to them as part of a switch. Though the terms and conditions vary, you might be required to move over some direct debits from this old account or set them up on the new account.

In most cases, these direct debits can be cancelled once you’ve got your cash bonus. So these are the accounts where you’ll probably want to add temporary or extra direct debits rather than move regular ones.

Switching offers come and go, but right now these are the accounts that require them:

• HSBC Advance – 2 direct debits or standing orders (can be added after the switch)
• Nationwide – 2 direct debits (active before you switch)
• Virgin Money M Plus – 2 direct debits (can be added after the switch)

It’s worth pointing out that the HSBC switch (when it runs) accepts standing orders as well as direct debits. This is a regular payment between accounts and really easy to set up to another current or savings account you hold. This makes it a better option than a direct debit.

Account rewards that require direct debits

The bulk of your direct debits are going to be needed for rewards. These are ongoing benefits that require a direct debit to be paid every month. If the payment doesn’t leave your account then you will miss out on the free money.

Account rewards that require the direct debits are:

• Barclays Blue Rewards – 2 direct debits (for monthly reward)
• Co-op Bank Everyday Rewards – 4 direct debits (for monthly reward)
• Natwest Reward – 2 direct debits of at least £2 (for monthly reward)
• RBS Reward – 2 direct debits of at least £2 (for monthly reward)
• Santander 123 Lite – 2 direct debits, though most likely five or six (for monthly cashback)

Personally I wouldn’t bother with the Co-op account as you don’t get much in return. So that’s eight direct debits you don’t need to worry about.

But if you then go for all the other four accounts you’d need at least eight direct debits and probably 11 or 12. This might seem a lot but it is possible.

Interest rates that require direct debits

These two accounts each require two direct debits if you want to earn 0.6% interest on savings of up to £3,999 and 1.5% on the balance between £4,000 and £5,000.

• Bank of Scotland Vantage – 2 direct debits (for interest)
• Club Lloyds – 2 direct debits (for interest)

It’s a decent rate compared to other options, but it can be beaten by better savings accounts. In light of that, I wouldn’t waste direct debits on these accounts.

Managing the minimum transfers

Most of the accounts require me to pay money in every month. If I didn’t I could miss out on all those little bonuses or get charged a monthly fee.

Here are the minimums for the main current account perks:

• Barclays Blue Rewards – £800 a month (to get rewards)
• Bank of Scotland Vantage – £1,000 a month (to get interest)
• Co-op Bank Everyday Rewards -£800 a month
• Halifax Rewards – £1,500 a month (to avoid fee)
• HSBC Advance – £1,750 a month (to keep account)
• Club Lloyds – £1,500 a month (to avoid fee)
• Natwest Reward – £1,250 a month (to get keep account)
• Nationwide FlexDirect – £1,000 a month (for interest)
• RBS Reward – £1,250 a month (to get keep account)
• Santander 123 Lite – £500 a month (to get cashback)

So how do you make meeting this easier? Automation is the key here, with standing orders moving the money on the same day each month. You can set these up easily in your online or app banking (though not all apps let you amend them if you want to make changes).

If you do have multiple accounts with the same provider, transferring between them often doesn’t qualify (eg Halifax to Halifax), so you’ll need to factor this in.

There are three methods here:

The endless cycle

One trick is to move the same cash from account to account so it cycles through each one and back to the start, then repeats itself the next month and so on.

For example, you’ve got £1,000 in account a, which you transfer to account b, then to account c, then account d and finally back to account a. Then it repeats the next month, and so on.

The back and forth

Another option is to set up a standing order out of one account into another, and then back the next day. And then move the money into another account and back.

So you’re move £1,000 from account a to account b, then back to account a. Then move £1,000 from account a to account c, then back to account a. And so on.

It makes sense to spread these out through the month so you’re still only moving the same amount of cash. to make sure there is cash in the account to leave it in the first place.

The bitesize transfer

If you don’t have £1,000 in your account to keep moving around, you can split the requirement into smaller chunks. So it could be two lots of £500, or four lots of £250. You get the idea.

You can use either the endless cycle or back and forth methods to automate this – you’ll just have more standing orders in action.

Covering account fees & direct debits

Don’t forget to add into your transfers enough to cover any direct debits going out of the accounts and any fees you might be charged.

Here are the main accounts that have a fee:

• Barclays Blue Rewards – £4
• Co-op Bank Everyday Rewards – £2
• Halifax Rewards – £3 (avoid if you pay in £1,500 a month)
• Club Lloyds – £3 (avoid if you pay in £1,500 a month)
• Natwest Reward – £2
• RBS Reward – £2
• Santander 123 Lite – £2

Collect your rewards

You should also factor in the rewards you’ll earn, but not all will pay directly into your account. You sometimes need to cash out your payments, so it’s worth making a note to do this once a month for the following:

• Barclays Blue Rewards (can be done via Barclays app)
• Natwest Reward (You need to log into the MyRewards site)
• RBS Reward (You need to log into the MyRewards site)

Logging into the app

There’s one final ongoing requirement with some accounts – you might need to log in to your online banking or app on a regular basis.

This might not be something you do naturally with extra accounts, so just put a note in the diary to do this once a month. It’ll take you two minutes.

• Co-Op Bank Rewards – every month
• Natwest Reward – every month
• RBS Reward- every month
• Santander 123 Lite – every three months

Making sure everything is OK

The standing orders and direct debits should all take care of themselves, but it’s worth making note of what money is going where and when. I’ve set up two spreadsheets to keep an eye on things.

The first tells me all the standing orders and direct debits in and out of each account. If I need to amend the size of a standing order (for example when switching banks), I know exactly which is which. It only updates if I change bank.

The other spreadsheet is more active. Every month I open up the apps for my accounts and write down the balances. I try to do this in the first week of the month. This way I know exactly how much I have in each account, and overall. I also add in how much I owe on each credit cards (even though I pay them off in full every month) so I get the true figure of my current savings.

I tend to use the banks’ own apps though services like Yolt and Money Dashboard can do this too. You can add all your accounts to it and see them all on one screen.