This may already exist, but I don’t think so as I have never seen it. My idea is to allow banks to let you “tag” money in checking or savings account for a certain purpose. Currently if you want to distinguish money for a certain purpose, say Christmas spending money you go and open an entirely different savings account to do so. This results in another statement being mailed to you and more work and expense for the bank to keep track of this new account.

I simply propose that you allow people to create tags/categories for money and you can move money in and out of these tags, but as far as the bank is concerned you only have 1 account, so you only get one statement and only have to put money into one account. This way I could create as many tags/categories for my money (vacations, Christmas shopping, investing, mortgage, new car, landscaping, etc) and set aside money for these various purposes without the maintenance headache for me and the bank of maintaining/closing/opening 10 savings accounts. This would allow me to easily plan and sort of budget all within my checking/savings account. It would also be really simple to implement (probably would maybe only be an on-line banking feature), but would require very little effort on their end, but I think would be of great value to it’s customers.For those of you unfamiliar with tagging – it’s simply a way to categorize items.

What do you think? Is this idea already being implemented by another bank? Is there an FDIC reason why you can’t classify money in an existing account? Is this a horrible idea?