#LittleSavings
When we have more than two bank accounts and maintaining min balance is a big headache.
I have accounts in HDFC, SBI, SCB banks.
Here is the list of min balances, I need to maintain in these accounts.
Here is the list of min balances, I need to maintain in these accounts.
- HDFC - 10,000
- SBI - 3,000
- SCB - No Min Balance as it is a Salary account.
It sums up to an amount of 13,000 rupees. I used to maintain these min balances in each account and keeping idly my money for 30 days and also cannot be withdrawn for my expenses. Initially, I thought, the idle money will be handy, if you have money shortage at month endings, and I can pay penalty for Non-maintenance of min balance of 300 rupees without depending on others.
But when I search for, how the banks calculate the AMB(Average Monthly Balance)?, I found a trick to avoid keeping the min balance amount for the whole month.
How Average Monthly Balance will be calculated by banks?
Suppose, if your bank transactions are as follows1st August - deposited 4,000
14th August - Withdrawn 1,000
28th August - Withdrawn 1,000
So, your AMB will be calculated as 3,333.33 (4,000*13 days + 3,000 *13 days + 2,000*2 days).
Trick?
If you deposit the "Total AMB amount" for one day, we can avoid maintaining the min balance amount for the rest of the days(literally for whole month).AMB of bank * No of days in a month = Total AMB to be desposited for one day.
Suppose if your MAB is 2,000, you can deposit 2,000*30 = 60,000 for one day and keep zero amount for the rest of the days.
But practically, which is not possible for the HDFC banks, where I need to maintain 3 lakhs for one day.
So for my case, I keep 15,000 amount for 20 days in HDFC and another 6 days in SBI to save 15,000 rupees for the remaining 4 days, which can be spent for your expenses. The real catch is, if you have a huge amount in your hand you can save up to 24 days, where the money will be ready for your expenses from the 7th day of the month.
Still Confusing? A detailed and practical explanation has been discussed here on how to maintain Min Balance for Multiple Accounts along with Calculator
At the end, I saved my 13,000 rupees from locking into bank accounts and now utilizing for the expenses.
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