Is Having Multiple Bank Accounts a Good Idea?
Is Having Multiple Bank Accounts a Good Idea?
100-Level (Novice) | Everyday Money Updated August 23, 2021
When it comes to bank accounts, is too much of a good thing too much? Should you have more than one or two bank accounts? And should they be at different banks? The more bank accounts you have, the more time it takes to track and manage them. But there are advantages to having multiple accounts. Read on to decide if having more than one bank account can be useful for you.
How many bank accounts should I have?
It’s an excellent idea for most people to have at least two bank accounts: a checking and savings account. And when you link your savings account to your checking account, transfers are a piece of cake. To keep things simple, you might want checking and savings accounts at the same bank.
Linked accounts with one routing number make managing your money easier. And some banks offer overdraft protection and cover a checking shortage with funds from your connected savings account. Yet, there are some reasons you might want multiple accounts (perhaps at different institutions).
Below are a few of those reasons:
You want a checking or savings account separate from the joint account with your partner.
You’re self-employed and need a business account separate from your personal funds.
You want to take advantage of the perks offered by different banks.
You don’t want to have all your money in one bank.
The Pros and Cons of Owning More Banking Accounts
Let’s look at the pros and cons of having multiple accounts, so you can decide if it’s right for you.
Pros: Why have a number of bank accounts
To track different savings goals. You might want to use multiple bank accounts for targeted savings goals. Keeping each savings goal separate makes it easier to manage and stay motivated.
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