When it comes to banking, it pays not to put all your golden eggs in one basket.
Just as our tastes in music, clothes, friends, dates, hangouts, and cheese all change as we get older, so do our financial needs and our habits.
Suddenly, we’re faced with those big-deal life moments – buying a new car, a house, saving for a wedding or a family, setting up a business, or taking a well-earned trip. All equal parts exciting and daunting, in the face of the escalating cost of living. And all requiring more financial know-how than just living week-to-week while squirreling cash away for a rainy day.
Recent YouGov research, conducted in collaboration with BCU Bank, revealed that 39%, or approximately 7.9 million – of Australia’s adults either do not have enough money for their non-discretionary spending (11%) or are barely getting by (28%).
Drilling down further showed those who use only one bank are more likely than those who use two or more banks to say they can’t afford non-discretionary items or are barely getting by (43% compared to 36%).
Pretty sobering stats, right? Coming to grips with ‘adulting’ can be tough.
For young(ish) Australians, exploring the best options to finance your goals can provide a smart step forward into adulthood.
Play the field, with your loyalty – and sanity – intact
For most Aussies, the foundations of financial monogamy were built at an early age.
Growing up, you likely pledged your first dollar to a Big 4 bank, dreaming of how many bags of lollies you could eventually buy with a bit of pocket money restraint.
While that plan may have served you well as a kid, it doesn’t mean the buck should stop there. Blind loyalty and nostalgia can only get you so far.
Things change. We move on to (hopefully) bigger, better, and wiser things. Looking further afield – and playing the financial field – can really get your money working for you.
In fact, being poly-bankerous (see what we did there?) can amp up your savings, getting you closer to your financial fantasies sooner than you think.
It’s all a matter of weighing up what you want, what you’re prepared to do to get there, and going for it – an effort-equals-reward scenario.
As a society, we’ve all grown very used to shopping around. From bulking up the weekly shop with farmers’ markets fare without breaking the bank, to comparing everything from home insurance to travel savings online, deal-hunting is practically a national pastime.
Just ask anyone with a mortgage about their pursuit of a better interest rate.
Why you should consider having multiple (financial) partners
Managing money well looks different for everyone, but whether you’re a saver or a spender, there are some key considerations that can help get you on your way.
If you don’t shop around, keeping all your money with your childhood bank can leave you at risk of the ‘lazy tax’ – the cost of not negotiating a better deal, and sticking with a bank that takes you for granted and fails to reward your loyalty. Indifference and imbalance are real stingers in a long-term relationship, right?
Depending on your situation and financial aspirations, separating your finances by banking around could help you with budgeting, earning higher interest rates on your savings so you can reach your goals faster.
So, what’s the magic number of accounts or lenders? This depends on your circumstances.
For couples, it can be helpful to have a joint account for shared bills, while keeping personal accounts for transactions, income, tax, and other savings goals.
For singles, having a transaction account as well as a dedicated saver can easily separate funds, making goal and balance tracking simpler.
Families can benefit from multiple transaction, savings or even fixed-term accounts. From school fees and grocery bills to mortgages, extracurricular activities and holidays, there are always mouths to feed and hands held out. Choosing the best products for each purpose can reap rewards.
For small business owners or side-hustlers – yes, we’re looking at you, post-pandemic life-growth-hackers – having a dedicated business transaction account, and a business savings account for future expenses can go a long way to managing cash-flow and curating long-term success.
Aussies are a clever bunch, and we’re catching on
YouGov and BCU’s research showed more than 43% of Australians are currently a customer of two or more banks, while just over half (53%) said they use only one bank.
There is a generational divide, though. Gen Z are the most likely to report using only one bank (66%), while older generations are more likely to use two or more banks, with Millennials at 50%, Gen X at 44%, and Baby Boomers at 43%, compared to Gen Z at 26%.
Australians with a household income of $50k+ are also more likely than those with a lower household income to say they use two or more banks.
So, what does this mean? For many Aussies, branching out could just be a matter of time – while younger Aussies are still attached to their childhood bank, they’re more likely to bank around as they get older, wiser, and a little richer.
What about protection from dreaded STDs?
STDs = Some Terrible Decisions, of course. What did you think we meant?
While the prospect of poly-bankery is enticing – including earning bank bonuses, higher interest rates, and being able to track multiple savings goals at once – managing more accounts can be tricky, with the potential for more fees and the need to juggle and track transactions.
But branching out with more than one bank doesn’t have to be difficult or leave you drowning in unnecessary life admin. Technology makes banking easier than ever with secure, convenient access to your accounts in the palm of your hand, and features to help you do what you want, when you want to.
If you’re a BCU customer who gets paid on a regular schedule, you can use the BCU Bank app to set up automatic transfers to your dedicated savings account.
It always pays to fully understand what you’re getting yourself into before you take any sort of financial leap. If you’re on the lookout for a new account or service, compare fees (monthly, transactional, ATM and foreign); read the fine print; and consider your direct debits, subscriptions, direct credits, and government payments.
If you do have any concerns about your financial situation, you don’t have to go it alone. BCU is by your side for financial moments big and small, whether that’s helping you budget with the mymo by BCU app, providing competitive interest rates, or offering transaction and savings accounts with great features.
While we may not be your first – or only – financial partner, we’re totally fine with that. We work hard to ensure we’re delivering value for all our members, by offering big bank energy with small bank service, and giving back to our community along the way.
If you decide to spread the financial love, we’re happy to be your bit on the side if it helps you get to where you want to be. Just save us some of that fancy cheese, please.