The High Five Banking Method

A good methodology to think about how to structure your bank accounts.

The High Five Banking Method
References / Credit
Graphically
Summary
Types of Accounts
Where to Bank
Joint Accounts
- Requirements
- Design
Appendix
- Version History

Last updated: Sat 22-Aug-2026 afternoon

References / Credit

Graphically

	flowchart LR
		IncomeSource["Income Source"] --> ChequingBills["Chequing 01: Bills"]
		IncomeSource --> ChequingLifestyle["Chequing 02: Lifestyle"]
		IncomeSource --> SavingsEmergencyFund["Savings 01: Emergency Fund"]
		IncomeSource --> SavingsShortTerm["Savings 02: Short Term Goals"]
		IncomeSource --> SavingsLongTerm["Savings 03: Long Term Goals"]
		
		ChequingBills --> BankAccountA["Bank Accounts"]
		ChequingLifestyle --> BankAccountB["Bank Accounts"]
		SavingsEmergencyFund --> BankAccountC["Bank Accounts"]
		SavingsEmergencyFund --> TFSAa["TFSA<br>(as cash if room is available)"]
		SavingsShortTerm --> BankAccountD["Bank Accounts"]
		SavingsShortTerm --> TFSAb["TFSA<br>(as cash if room is available)"]
		SavingsLongTerm --> TFSAc["TFSA<br>(as investments)"]
		SavingsLongTerm --> RRSP["RRSP<br>(as investments)"]
		SavingsLongTerm --> LIRA["LIRA<br>(as investments)"]
		SavingsLongTerm --> RESP["RESP<br>(as cash / investments)"]
		SavingsLongTerm --> etc["etc."]

Summary

The concept is to create five bank accounts to help you automatically manage your budget.

For those accounts that pay bills

This month you are saving money for next month’s bills.
So by the start of next month your bank account has all the money needed to pay next month’s bills.
Yes, you will have to do a bootstrap of the first month.

	Type	Purpose
01	Bills	Top priority - Housing - Debt - Utilities
02	Lifestyle	You can lower these expenses to save money - Personal Care - Hair cuts - Gym - Entertainment - Eating out - Clothes - etc.
03	Emergency Fund	Real Emergencies - Hospitalization - Job Loss - Home Repairs - Car Issues
04	Short Term Savings	Takes less than 12 months to reach - Upgrades - cell phones, purse, etc. - Special Occasions - Xmas, Birthdays,Anniversaries - Small Travel or Events - Annual Expenses
05	Long Term Savings	Takes more than 12 months to reach - Down payments - Cars - Homes - Big Travel - Wedding - Baby - etc.

Types of Accounts

Canadians have a large number of account types to choose from:

Banking
- Chequing
- Savings
- Hybris of Chequing and Savings
TFSA
RRSP
FHSA
RESP

Some of the above listed “bank” accounts could (and should) be multiple forms.

For example, your Long Term Savings could/should be

A bank account for your next car
A bank account for your next big travel
A TFSA for your retirement savings
An RRSP for your retirement savings
etc.

On the oppositive side, depending on your individual circumstances, you may not need all of these accounts at a given point in time.

But you should think about these types of accounts and decide how they best fit into your financial journey.

Where to Bank

There are many choices as to where to bank - big 5 as well as smaller providers.

Consider where you will get the best features (e.g. interest rate on Emergency Fund) as opposed to convienence.

Banking should be optimized but not to the expense of peaceful living.

Strike the balance that is good for you.

https://www.moneysense.ca/save/banking/the-best-banks-in-canada/

Joint Accounts

Joint accounts (between spouses, roommates, etc.) can represent an extra level of complication above and beyond The High Five Banking Method.

Requirements

There are two people: People 01 and People 02.
Each person should have their own accounts (banking and investing).
There should be joint account(s) for shared activities.
Each person should have their own possessions protected.

Design

	flowchart TD
		Paycheque01["Paycheque 01"] --> BankAccount01["Banking Accounts 01"]
		BankAccount01 --> HighFive01["High Five 01"]
		
		Paycheque02["Paycheque 02"] --> BankAccount02["Banking Accounts 02"]
		BankAccount02 --> HighFive02["High Five 02"]
		
		subgraph Joint["Joint"]
			direction TD
			Joint01["Joint 01"]
			Joint02["Joint 02"]
		end
		
		BankAccount01 --> Joint01
		BankAccount02 --> Joint02
		
		Joint --> HighFive["High Five Joint"]

Notes

Each person’s paycheque is dropped into their own bank account.
- This prevents comingling of the funds.
Each person’s Banking Accounts will send money to their own High Five set of accounts.
- This will allow each person to have their own set of accounts (savings, spending, investing, etc.).
Bank Accounts 01 will send funds to Joint 01; and Bank Accounts 02 will send funds to Joint 02.
- The couple needs to decide how much money should be moved to the Joint 01 and Joint 02 accounts. Some options:
  - A percentage - 10% is kept and 90% is moved into the joint accounts.
  - A fixed amount - $100 is kept and the rest is moved into the joint accounts.
- Each joint account is dually owned by both people so this achieves the legal need for this to be a joint account amoung the partners.
- But there is a separation so that we know that the funds that end up in Joint 01 came from Person 01 and similarly for 02.
- This achieves tax clarity.
  - If a tax slip is generated for Joint 01 we know that this should be filed with Person 01’s taxes and similarly for 02.
  - A question would be: Is this level of clarity needed?
    - If these accounts will hold very little funds and thus generate very little tax implications then this level of complexity.
The Joint account (i.e. the combination of Joint 01 and Joint 02) will then fund the High Five Joint accounts.
- Thus allowing the couple to fund and live their lives.

Appendix

Version History

	Date	Notes
01	Wed 12-Aug-2026	Initial version
02	Fri 21-Aug-2026	Added Joint Accounts