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Internal transfers: one debit, one credit, nothing spent
On the 5th of the month, €500 leaves the current account for the savings account. The current account statement shows a line at −€500, the savings account statement a line at +€500. Each statement, read on its own, is correct. What the household owns has not moved by a single euro.
These two lines are the two legs of one transfer. A spreadsheet that stacks the exports of two banks, or a view that brings every account together, reads them as two separate movements: an outflow of €500, filed with spending, and an inflow of €500, filed with income.
National accounting sets the frame. Insee, the French statistics office, defines the household savings rate, in a definition updated on 28 January 2021, as the share of gross disposable income "that is not used by households for final consumption expenditure" (our translation). Saving is income minus consumption. A transfer between two accounts of the same household adds nothing to income and buys nothing. It touches neither term.
The two legs do not always carry the same date. Article L133-13 of the French Monetary and Financial Code, in force since 13 January 2018, provides that the amount is credited to the payee's payment service provider "at the latest by the end of the following business day" after the order is received (our translation), with one more business day for an order given on paper. The Banque de France page on SEPA credit transfers puts it simply: one business day at most for a standard SEPA transfer.
Between two accounts at the same bank, the credit can arrive the same day. Between two banks, an order placed on a Friday may only reach the other statement after the weekend, and the two legs then land several days apart.
An internal transfer moves money between two pockets of the same household: income and consumption stay exactly where they were.
Transfers counted twice: one month, two accounts
The example follows an ordinary month. A €3,500 salary lands in the current account and €2,300 of actual spending goes out of it. On the 5th, €500 goes to the savings account. On the 20th, €200 comes back, credited to the current account the next day. All amounts are assumptions.
| Date | Account | Transaction | Amount | Naive reading | Correct reading |
|---|---|---|---|---|---|
| 1st | Current account | Salary | +€3,500 | Income | Income |
| 1st to 30th | Current account | Everyday spending | −€2,300 | Spending | Spending |
| 5th | Current account | Transfer to the savings account | −€500 | Spending | Internal transfer |
| 5th | Savings account | Transfer from the current account | +€500 | Income | Internal transfer |
| 20th | Savings account | Transfer to the current account | −€200 | Spending | Internal transfer |
| 21st | Current account | Transfer from the savings account | +€200 | Income | Internal transfer |
The naive reading files each line by its sign, so the four transfer lines turn into two incomes and two expenses. The correct reading pairs them off and takes them out of the totals.
| Monthly total | Naive reading | Correct reading |
|---|---|---|
| Income | 3,500 + 500 + 200 = €4,200 | €3,500 |
| Spending | 2,300 + 500 + 200 = €3,000 | €2,300 |
| Balance | 4,200 − 3,000 = €1,200 | 3,500 − 2,300 = €1,200 |
| Savings rate (balance / income) | 1,200 / 4,200 = 28.6% | 1,200 / 3,500 = 34.3% |
The balance does not move, because each transfer adds as much to income as to spending. The accounts agree: over the month, the current account gains 3,500 − 2,300 − 500 + 200 = €900 and the savings account 500 − 200 = €300, €1,200 in all.
The gross totals drift, though. Income gains €700, 20% more than the salary. Spending gains the same €700, 30.4% more than what was actually spent. The savings rate, worked out as the balance divided by income, loses 5.7 points, from 34.3% to 28.6%.
The guide to the savings rate uses a narrower measure, the share of net income invested each month. It has the same denominator, net income, so €700 of transfers counted as income drags it down in the same way. A split such as the 50/30/20 rule also starts from net income: on €4,200 instead of €3,500, every bucket grows by a fifth.
The gap widens with the number of transfers. Each €500 round trip adds €1,000 to each total. Four in a month add €4,000, more than the salary itself.
Counted as movements, €500 and €200 of transfers add €700 to income and €700 to spending, and the savings rate falls from 34.3% to 28.6%.
Track multiple bank accounts: recognising the two legs
Two lines usually make up an internal transfer when they share five traits:
- the same amount, to the cent;
- opposite directions, a debit on one side and a credit on the other;
- close dates, the same day or a few days later if a weekend falls in between;
- the same currency;
- one leg on each of the two accounts, both inside the tracked scope.
The transaction description sometimes helps, when it repeats the name or IBAN of the other account, but every bank words it its own way. And each trait has its exceptions.
| Case | What the statements show | Two legs? | Reading |
|---|---|---|---|
| Interest on the savings account | A credit on the savings account, no debit elsewhere | No | Income |
| Bank fees | A debit on a single account | No | Spending |
| Monthly debit of a deferred-debit card | A debit on the current account, the card balance reset to zero | Yes, if the card is tracked separately | Internal transfer; the purchases made with the card are the spending |
| Transfer from a Swiss franc account to a euro account | Two different amounts, in two currencies | Yes, but the amounts do not match | Internal transfer, except the share lost on the exchange, which is spending |
| Transfer to a spouse's or a child's account | A debit, and a credit on an account outside the scope | No | Money leaving, unless that account is part of the view |
Interest on the savings account has no matching leg: the bank credits it and nothing leaves another account. It is income. Bank fees work the other way round and count as spending.
The deferred-debit card takes more care. According to the Banque de France page on payment cards, transactions on such a card are "added up and debited from the account on the date set in the contract, usually at the end of the month" (our translation). When the card statement is tracked separately, each purchase already sits there as spending, and the monthly debit only settles the card from the current account. Counting it as well would count every purchase twice. When only the current account is tracked, that debit is the one trace of the purchases, and it carries the spending in a single block.
Between two currencies, the same-amount test no longer works. A cross-border worker paid in Swiss francs who transfers CHF 1,000 to a euro account receives an amount set by the exchange rate applied, minus fees. Converted into one currency, the two legs do not cancel out. The share that matches the day's reference rate is an internal transfer; the gap, made up of fees and exchange margin, is a real cost.
Last case: a transfer to a spouse's or a child's account is not internal as long as that account stays outside the view. The money leaves the tracked scope. If a joint account is among the accounts added together, a transfer to it becomes internal again.
Two lines form an internal transfer when they match in amount, direction, date and currency, and both accounts belong to the tracked scope.
Duplicate transfers: what the total does not show
The order in which accounts are added makes no difference. A sum is a sum, and a transfer from the current account to the savings account pairs up the same way whether the savings account comes in first or last.
A period imported twice does change the result. If two exports of the savings account overlap by a week, every line from that week appears twice. The €500 debit on the current account then faces two €500 credits: one pairs up, the other stays counted as income. If both accounts are imported twice, the transfers still pair up, but the salary and the spending for that period are doubled.
Each account's opening balance matters too. If the current account's history starts in January and the savings account's in March, the January and February transfers to the savings account have no matching leg and turn back into spending. Those deposits are still part of the savings account balance on 1 March; if the opening balance used for the savings account does not match that date, the total across accounts drifts away from what the statements say.
That leaves the end of the month. A €500 transfer ordered on Friday the 30th may only be credited the following Monday, since Article L133-13 of the French Monetary and Financial Code allows until the end of the following business day. Month by month, the first month shows a debit with no counterpart and the second a credit with no origin. Over the two months together, everything cancels out. Taken one at a time, one month seems to have cost €500 more and the other to have brought in €500 more.
A transfer with only one leg inside the period or the history turns back, in the totals, into spending or income that never happened.
Frequently asked questions
Is a transfer to a savings account an expense?
No. The money stays with the household, in another account. In Insee's definition, saving is the share of disposable income that is not consumed, and a transfer to a savings account consumes nothing. Counted as an expense, it lowers the savings rate at the very moment the money has been put aside.
How do you avoid counting transfers twice?
By pairing the two legs of each transfer, the debit on one account and the credit of the same amount on the other, a few days apart, then taking them out of the income and spending totals. In this guide's example, that pairing brings income back from €4,200 to €3,500 and spending from €3,000 to €2,300.
Is a deferred-debit card payment an expense?
It depends on what is tracked. If the card statement is, the purchases are already counted there, and the monthly debit on the current account is only a transfer between the account and the card. If only the current account is tracked, that debit is the one trace of those purchases, so it carries the spending.
How do you track multiple bank accounts without duplicates?
By bringing the statements of every account together over the same period, each with an opening balance that matches the start of its history, then pairing the transfers between them. A period imported twice brings duplicates back, and a transfer leg with no counterpart, at month end or before a history begins, reads as spending or income.
Key points
- A transfer between two accounts of the same household is neither spending nor income: it changes neither disposable income nor consumption.
- Added up account by account, internal transfers appear twice and inflate income and spending by the same amount, without changing the balance.
- In the example, €700 of transfers push income from €3,500 to €4,200 and the savings rate down from 34.3% to 28.6%.
- The two legs are recognised by amount, direction, date, currency and their two accounts, both tracked; interest, fees, transfers between currencies and transfers to someone else's account are the exceptions.
- A period imported twice, a misaligned opening balance or a transfer straddling two months leaves one leg on its own, and that leg distorts the totals.