It’s easy to put all your money in one or two accounts, pay the bills, and then just live on whatever is left over, perhaps mentally putting some aside for savings. But, that doesn’t allow much room for planning or measuring your success. Instead, divide your funds so that they all have a specific place and reason for being there.
Create one account just for your bills. You can even set up auto-draft so that your bills come out on the date they are due. All you need to do is have the money in there on time. You can set up direct deposit so that funds go in different accounts, too.
There are a couple of different ways you can set your savings aside. You might create multiple savings accounts so that each goal has its own account, or you might keep the money at home in specific envelopes or other means of dividing your money.
The point here is really to keep funds separated so that you know exactly how much you have and what you have it for. Then, you can plan how much to put towards old debts, a new car, a college fund or whatever it is you’re saving for. And yes, it is important to set aside funds for entertainment. Otherwise, all the time you spent working isn’t really worth it.