Hi All
It is to be assumed that those of us who use MMEX and its future transactions feature are financially asture and, very sensibly, concerned to ensure expenditure does not exceed income. However, it is also clear that recent changes to the way the data is added to the accounts has caused some confusion and frustration.
I wonder if you’ll permit this ‘old geezer’ to offer a solution because I resolved this dilemma over 40 years ago, long before home computers, it leads to the peace of mind we seek, and it makes the methodology employed by MMEX (which is the source of the frustration) something of a moot point.
Here in the UK there’s nothing to stop you having more than one bank account and, so long as the account’s in credit, it’s free, so here’s what I do.
1. I have a second bank account just for bills and call it my budget account.
2. Having worked out the total of all the bills I will pay over a year I divide this by 12, and I have a standing order from my current account to my budget account for this amount.
3. All my bills are set up so that they’re paid from my budget account, either by standing order or direct debit.
The aim is for this account never to be overdrawn and, to avoid that, it will be necessary, when opening the account, to add an extra injection of cash as well as the first 1/12th of the annual total because, in some months, your bills will exceed more than the standing order but, once you’ve worked out how much this needs to be, your budget account should never fall into the red.
This has the advantage that, if you are with the right bank, the surplus should earn you interest – mine is currently earning me 4% AER.
This system resolves the issue with MMEX’s method of handling recurring transactions because now you will always know how much is to be transferred out of your current account each month to meet your commitments. This is, if you like, the first future transaction, set to auto-execute on payday.
In respect of the recurring transactions for your bills these, of course, are set up to debit the budget account and since this should never fall into the red, there’s no pressing need to enter these prior to their due date to see what the balance will be in the near future, all you need to do is reconcile the bank’s statements with your mmex records as and when they come in.
Of course, this system doesn’t alter the way that MMEX handles future transactions but it should resolve concerns about upcoming bills and I find I have no need to enter future transactions in advance of their due date, I simply set them to auto-execute without user acknowledgement. A glance at the balance in my current account usually tells me what I really need to know.
One other small discipline is necessary with this system. I run a spreadsheet which lists all my bills and every time there’s a change to be made I update the spreadsheet so that I can instantly see how this affects the necessary monthly transfer. The advent of online banking has made updating this amount a doddle.
HTH
