How Many Bank Accounts Should I Have and Why?

Banks are a great way to earn interest on funds, transfer money between accounts and people, and even get rewards.

But how many bank accounts should you have? We asked financial experts to share their insights.

Steffa Mantilla, CFEI

Steffa Mantilla

Certified Financial Education Instructor, Money Tamer

The bare minimum number of accounts you should have are two: checking and savings

Your paycheck will be deposited into your checking account and all of your regular budgeted expenses will come out of checking as well. The savings account is where you put the money you want to save for a later goal.

I personally recommend having up to 6 or 7 bank accounts: regular checking, emergency fund savings, car maintenance fund, fun money (for each partner), vacation fund, and other sinking funds for birthdays and Christmas.

When doing it this way, your regular checking account is still where the majority of your transactions take place. Immediately after getting paid, you’ll transfer your pre-determined amounts into each of the savings accounts.

For the emergency fund, you’ll want to build it up to 3-6 months worth of your monthly expenses. This will cover your living expenses should you lose your job unexpectedly. Once your emergency fund is built up, you don’t need to keep contributing to it unless you use some of it.

The car maintenance fund is money that can be used for regular car expenses like oil changes, or more pricey costs like new tires or even buying a new car. The vacation fund is money you save up for planned vacations and getaways. That way when you’re wanting to travel, you aren’t tempted to put those expenses onto a credit card.

Birthdays and Christmas come every year yet people rarely have the money saved up to buy presents. By putting small amounts into these accounts every month ($25-$50) by the time those dates roll around you’ll be prepared and able to buy gifts stress-free.

Joseph Varno

Joe Varno

Financial Advisor

Banks would have us owning multiple bank accounts because they get paid to open and maintain those accounts. So, how many should one have?


  • We still need a checking account to be able to move money from one account to another.
  • Autopay requires an account to take money from, usually checking.
  • Paycheck net proceeds usually go into a checking account.
  • You may still need a live check to pay for things.
  • Checking accounts usually get 0% interest so the minimum one feels comfortable with should be held in checking.


  • Some paychecks deposit money right into a savings account.
  • Savings accounts today get less than 1% interest.
  • Most advisors encourage about 6 months of living expenses sitting in savings.

Business Checking and Savings

If you own a business, most will have a checking and savings for the business for the same reasons above.

Checking and Savings accounts are safe, liquid, get super-low rates of return, and any gains are taxable. All are protected by FDIC up to $250,000 per account. So if one has a lot of money and they are trying to protect against bank failure, then multiple accounts should apply.


Many banks offer investment accounts. Some of which are managed by a professional money manager and some allow the client to invest on their own.

If a person just needs the basics, one checking and one saving account will be perfect but not one more as it provides no additional benefits. Keeping track of multiple accounts can also be exhausting.

Adrienne Hines

Adrienne Hines

Bankruptcy Attorney, Kademenos, Wisehart, Hines, Dolyk & Wright Co. LPA

It really depends on your financial situation

I typically suggest having at least two accounts – one checking and one savings. However, there really isn’t an exact number that works for everyone. It really depends on your financial situation.

For example, if you are able to have a checking account for household expenses and another for travel expenses while avoiding banking fees, then doing so would be a good fit for you. However, if splitting your income into multiple accounts would be hard to manage, it would be best to maintain a simpler account structure.

If you do choose to have more than one checking account, one should be at the banking institution that processes your paycheck, and the other should be at a bank or credit union where you don’t owe any money. For example, you wouldn’t want to open a second checking account at an institution where you’ve taken out a loan.

The benefits of having multiple savings accounts

Something to consider when contemplating multiple banking accounts is having one checking account and multiple savings accounts. This actually allows you to save for various personal goals. In fact, it’s an approach that’s similar to the popular “envelope system.”

Let’s say that you wanted to create an emergency fund and save for a home. You could establish two savings accounts that are connected to your checking account. Then you’d set up savings automation with your bank, which would consistently deposit a specified amount into either account every month. Not only would this help you reach your goals but it will also help you more easily track the progress you’ve made.

Scott Nelson

Scott Nelson

CEO, MoneyNerd, Ltd

Three bank accounts

You’ve no doubt heard the term ‘don’t put all of your eggs into one basket’ and this is very much relevant when it comes to bank accounts. In my humble opinion, adults should have three bank accounts as follows:

Current account

This is, of course, your main bank account and is the one which you use for your day-to-day spending including withdrawing cash and making small to medium purchases. You should check on your current account every few years to make sure that you’re getting the best in terms of rates and benefits.

Savings account

This account should only be used for your savings (either for a major purchase or for retirement) and shouldn’t be ‘dipped into’. It is a good idea to set up a direct debit to transfer an amount of money into your savings account on payday each month.

Utilities account

This is particularly useful for couples and is, essentially, a current account from which your household bills, including mortgage or rent, are paid. Many people find it helpful to set up a direct debit on payday to transfer enough money to cover these things from their standard current account into this one as, this helps to keep money for bills separate from disposable income. Its also a good idea to add a little extra to the monthly transfer to cover emergencies.

The number of accounts you hold depends on your lifestyle and requirements, however, I wouldn’t recommend having a huge number of accounts as this can be difficult to manage.

Kevin Patrick Jordan

Kevin Jordan

Investment Adviser Representative | Director of Operations and Planning, Macke Financial Advisory Group

Less is more

First, let’s start with the amount of cash you want to keep in checking or savings. Most experts will advise you to multiply your typical monthly expenses by a range of 3-8 months. This amount would cover an emergency expense like a transmission replacement, or it could cover the waiting period before disability insurance kicks in.

Keeping 2-3 months worth of expenses in checking should keep you from being overdrawn, and the rest of the balance can be kept in savings for (minimal) interest and easy transfer if needed.

Of course, you would want to use this account primarily for paying the monthly credit card bill since you accumulate cash or rewards by using a credit card for everyday purchases.

“What about the rest of my cash?”

Your bank will undoubtedly encourage you to put it in an investment account at their institution for a range of perks (Gold Rewards, Platinum Tier, etc); but these perks are typically outweighed by the management fees the bank will charge you long term.

Instead, find a bank that allows self-directed investment accounts (especially one that has 0% trading fees!) and do some research or ask a financial advisor for some general long-term investment recommendations. You can always transfer money from this account into your checking in case of an emergency without any taxes or fees.

If you do not have a retirement plan through your work such as a 401(k) or 403(b), you should consider creating your own account at this same institution in the form of an IRA. These are investment accounts that provide real tax benefits for the money you deposit into it every year, thus incentivizing you to save more for retirement. You would not be able to transfer money out of this account before age 59.5 without incurring steep tax penalties.

John Li

John Li

Co-Founder and CTO, Fig Loans

On average it’s important to have two major forms of bank accounts, a checking account for monthly or essential expenditures, and savings account for holding long-term funds. Prior to opening accounts, you have to assess your spending habits.. How often you spend, long-term goals, as well as your income cap all play a part in the number of bank accounts and the type that you would need.

Taking these into consideration, these three accounts are all you need:

Checking account

This serves as your primary account and allows you to have as many transactions as your balance will allow. Most checking accounts also usually have minimum balance requirements and are used for maintaining your checking account.

Savings accounts

These accounts vary in their ability to hold certain amounts of funds, as well as set limits on withdrawals either periodically or up to a certain amount. Savings accounts also offer higher interest rates compared to checking accounts, depending on the kind of savings account that you get.

As a rule of thumb, make sure to align your savings account with long-term goals, so as to get the most out of compounding funds in your savings account.

Retirement accounts

These types of accounts are solely meant for retirement, and an option that’s suitable for everyone is an IRA that allows you to invest your funds with variable options.

Another retirement account is a 401k, which has more perks and is a good alternative, as long as it’s provided by your employer. In the event that you switch jobs or leave your employer, this can be rolled over into an IRA.

How confused you really want to be? The simple answer is less is best

One main checking account for your household to keep everything under control and paid on time is all you really need. Unless you have a business also.

I recommend having utilities, credit card payments, installment loans, mortgages, etc. all coming out of your primary personal checking account automatically. That doesn’t mean you ignore it. That does mean you check on it every month to be sure everything is running smoothly. Oftentimes credit cards will have an annual fee so you mark that in your calendar as a recurring “birthday” so you don’t forget to check it and pay it. Happy birthday Barclays!

For those of us in business for ourselves, it’s definitely a necessity to have a business account separate from your personal account.

Depending on how many different types of businesses you run and how your taxes are calculated will help determine how many bank accounts you actually need. Less is best in this scenario. Save yourself the hassle and confusion, definitely invest in some software that does reconciliation for you such as QuickBooks. Also, keep in mind that each bank account you have will cost you! The banks will love you but there will be fees, fees, and fees. Monthly, sometimes per transaction, on business accounts they may have a fee per check you deposit!

Savings accounts you ask? Certainly, says the bank. We’ll gladly pay you ..05%! However, there is a $20.00 per month fee for your savings account! Drat! Here’s where the financial advisor comes in. It’s worth it to shop around, educate yourself and do some simple math to see if you are gaining, staying the same, or losing the principal deposit you put into your investment account.

Saving and investing are separate entities from your everyday checking for personal or business. It’s still a good idea to have fewer of these accounts to keep things simple. You can diversify within the account you open if it is some sort of annuity or mutual fund for example.

Another odd but interesting point to consider. Most loan applications for mortgage, cars, anything you apply for credit on, are only going to have about 2-4 spaces for your asset accounts so that may limit you on showing off where all of your money is.

In short, you can find a good bank or credit union that will do the job you are looking for without robbing you of precious time keeping track of too many of them.

Bryce Welker, CPA

Bryce Welker

CEO, CPA Exam Guy

The average person should have two accounts, a checking, and a savings account

This is sufficient for most people. You set aside part of your income for your checking account and deposit the remainder into a higher-interest savings account that you don’t touch.

How many accounts a person needs, however, depends on how complicated their finances are.

If you invest money in the stock market, you are going to need a brokerage account. If you are a small business owner, you will need a business account that is used strictly for business operations. If you live in a country where you have access to a tax-free savings account, that would be a fourth account worth having.

Dorota Lysienia

Dorota Lysienia

Community Manager, LiveCareer

Everyday spendings, savings, emergency expenses

I find it helpful to have my finances structured into three blocks: everyday spendings, savings, and emergency expenses. That’s why I have one bank account for each of the three categories. Such a system helps me to manage my regular expenses, save some money, and be prepared for unexpected things that might happen in my life.

I use one bank account for everyday expenses that occur regularly each month. It’s for paying the bills, grocery shopping, bus and metro tickets, gym membership, just to name a few. My salary is transferred to this account and used for things I need to take care of on a daily basis.

However, it’s good to save some money for our future needs. Are you thinking of putting some money aside for your next vacation or replacing that old microwave your family is complaining about? A savings account is perfect for that. You can devote a specific amount of money each month and transfer it from your everyday spendings account.

Last but not least is the account for emergency expenses. These are the things we don’t plan and most often are not prepared for. Why? Because a broken fridge or your son crashing your neighbor’s car usually comes out of the blue. That’s why it’s good to have some money for emergencies and avoid using your savings for such unfortunate circumstances.

It doesn’t have to be a big sum. Start with $500 that can be easily used in case something happens. It’s a huge relief when you don’t need to take this money from your everyday spendings or savings for this new bike you’ve been planning to buy for months.

Jim Pendergast

Jim Pendergast

Senior Vice President, AltLINE

Open at least one business checking and savings account in a single bank

Both saving and spending are essential to owning a small business, and it’s important to know where your money is going each month. These accounts should be primarily used for bank reconciliations at the end of the month and to keep track of taxes.

Start accounts in banks and credit unions that cater to your audience

Some financial institutions have very specific rules for what they expect from their clients. If, for example, you own a used car dealership, you’ll need to find a bank that works with your customers to get financing.

Open as many accounts as you want, as long as you’re increasing cash flow

There is no limit to the number of accounts you can open, but adding too many bank accounts can bog you down with financial statements and won’t help you make money. If you find any accounts that aren’t bringing in cash every month, it’s time to close them.

Alecia Buckhanan

Alecia Buckhanan

Founder & Financial Consultant, In debted Mom

Three bank accounts

I think everyone who is earning money and wants to manage it perfectly should have three bank accounts such as a checking account, emergency funds, and a savings account.

Having all these accounts doesn’t just do the job, rather you need to know the purpose of each one of them and make sure they’re used as they are supposed to be used.

One should ensure that the money every account holds isn’t used for any other purpose, otherwise, there is no point in having different accounts for different uses.

Every account serves a specific purpose. The reason for having different accounts is that every account will have a different purpose to serve. I suggest you not to use one account for two or more purposes because you’ll end up stressing yourself out having to manage everything through a single account. It would make money management almost impossible for you.

Checking account

It is used to manage and regulate your day-to-day expenses like utility and grocery bills. Every individual or family has household finances to manage every month. All these are managed through a checking account. This is also called a current account.

You can’t use emergency funds to manage everyday expenses, or you’ll be left with little or no funds to use in emergencies.

Emergency funds

As suggested by the name, this account will have funds that can be used in an emergency such as medical or a major house repair. You never know what’s coming your way. So you always need to be financially prepared, and emergency funds play a critical role in this matter.

Savings account

It is the one used to save for long-term goals such as retirement or making an investment in the distant future. I would never consider you wise if you don’t have a savings account and don’t save anything for the future. You won’t be able to work for long hours in old age and this is when you’ll need the savings.

Also, the money you save provides a great opportunity to invest when you don’t feel like doing a job or want to earn more money.

Donna Tang

Donna Tang

Budgeting and Finance Expert, CreditDonkey

There’s no harm in having multiple accounts if a person can handle them accordingly

Having more than one account should be justified by your need. If you have a considerable income and need to manage your finances, you should keep various bank accounts. In case you don’t have regular transactions in your accounts, the banks will shut them down. At times managing more accounts can be difficult. Thus, it depends on your requirement and uses to have multiple accounts.

Be sure of what you need and what you don’t need.

Remember, two accounts are enough to use, but you can still have more as per your requirements. Other logical and possible reasons can be a need for a savings account or running a business where you have to do transactions for your employees, so you need a business account.

Brittany and Kelan Kline

Brittany and Kelan Kline

Personal Finance Expert, The Savvy Couple

At a bare minimum, you should have two bank accounts

One checking account for your monthly expenses and one saving account for your emergency fund. After you have your primary bank accounts satisfied, it can often be very beneficial to open up additional savings accounts.

For example, if you are saving a down payment for a house, a future car repair, or a family vacation opening up an additional savings account is a great way to start a sinking fund. You can easily set up as many savings accounts as you need with your bank and start automatic contributions at the start of the month. That way you are “paying yourself” first before any other bills are paid almost guaranteeing you hit your savings goals.

Everyone’s situation is different and requires a different personal finance system to help them reach their goals. You don’t want to overcomplicate things by having too many bank accounts to monitor, track, and worry about.

Our recommendation would be to start with the basics of one checking and one saving. Then as your financial goals change over time or you have something specific you are saving for, you can open up additional accounts at that time.

Amber Kong

Amber Kong

Content Strategist, CreditDonkey

Regardless of profession, background, or marital status, every individual who wants to be smarter in handling their finances should have at least three bank accounts; why?

A checking account is where you could easily manage your monthly, weekly, and everyday expenses. Since checking accounts are very accessible and liquid, you could organize everything in checks, cash, or online transactions. This is where your money temporarily hangs out before they go and do their duties in paying your bills.

A savings account is meant to keep and save your money for the long term. This is where you build and maintain your emergency fund, large down payments, or anything that you want to invest in for future purposes. Its primary focus is to safe-keep your money for an extended period.

Get another savings account to cover your short-term goals or needs. We all have wants and goals to fulfill, like traveling or rewarding ourselves with luxurious things once in a while. A savings account for your short-term goals will serve as the middleman. Your short-term savings will go here without robbing your long-term savings or compromising your regular expenses.

As a financial writer who always aims to bridge the gap between people and their finances, having at least three bank accounts is the simplest yet most systematic way of keeping your money in order.

Shanita Dorsey

Shanita Dorsey

Business Strategist

The amount of bank accounts you should have is dependent upon your needs

For personal use; it’s best to have three bank accounts; two checking accounts and one savings account.

  • Checking Account #1:Use to direct deposit all of your funds from your job.
  • Checking Account #2:Use to automate and pay any and all bills
  • Savings Account: Build an emergency fund of $1,000+ for when unexpected things happen, like your car may break down.

If you’re a small business owner then you need a business checking and saving account.

  • Business Checking Account – Used to accept direct deposits
  • Business Saving Account – Save money aside for taxes, projects, etc.

The purpose of doing this is to separate your business and personal assets. If business funds are commingled with your personal funds, the owner can lose their liability protection from their LLC, known as piercing the corporate veil.

Carol Tompkins

Carol Tompkins

Business Development Consultant, Accounts Portal

Minimum of two accounts

Ideally, you should have a minimum of two accounts – a checking account and a savings account – so that you can keep your finances organized. The checking account can be used to cater to your monthly expenses, while the savings account helps you save towards your goals.

You can then add on a money market account that acts as a savings-expenditure hybrid. The money in this account can be used as a secondary source of expenditure funds if you exhaust the funds in your checking account. The funds in the MM account also earn interest, which helps increase your savings, and can be used to offset future expenditure needs.

John Davis

John Davis

Education Ambassador, ScoreSense

I’ve spent most of my career helping people better understand their finances, including investing, planning, and more. With my experience as a financial education ambassador, your query is one I would be happy to give some thoughts on.

It is wise to have three bank accounts – two checking accounts and a savings account.

Place the funds for your monthly expenses in one checking account. This account should be set up so that if you do not have enough funds to cover a check then the balance owed will be taken from your savings account. Using this method you will avoid any penalties.

The second checking account is for your Emergency Fund. Ideally, the fund should cover your basic living costs for 6 months to a year. A checking account will give you instant access to the funds which is essential as it is for emergencies and unexpected expenses.

By keeping your savings separate from your emergency fund and checking accounts you will avoid the temptation of dipping into them. Having an account that limits access but provides a high interest rate will help you to maximize your savings.

Jim Wang

Jim Wang

Founder, Wallet Hacks

You only need one bank account

With the popularity of online banks with feature-rich smartphone apps and fee-free ATM access(or ATM fee reimbursement), there isn’t a compelling reason to have more than one bank account. An online checking and savings account will give you the highest interest with the most flexibility.

If you’re not comfortable with just an online bank, add a second account at a local brick and mortar bank so you can deposit cash into their ATM (one of the only limitations of an online bank). There aren’t many strong cases for more than two accounts so if you are looking to open a third, there has to be a really compelling reason.

Kari Lorz

Kari Lorz

Founder, Money for the Mamas

My husband and I have nine bank accounts together, and they work together seamlessly! I know it doesn’t “sound” easy, but it really is! With these accounts, we can afford everything we need!

Sinking funds are great for saving money

Every month, right after payday, funds get automatically transferred from our main checking to our sinking fund accounts. We have a vacation fund, a home repair fund, a car repair fund, a kiddo fund, and we each have our own separate savings accounts. We also have an emergency fund in a high yield savings account that’s fully funded with one year of living expenses.

Every month money flows into these accounts, and sometimes it flows out, never getting full, and hopefully never completely empty! The key to success is to pay yourself first and automate everything you can to save money every month without fail!

Magda Zurawska

Magda Zurawska

HR Manager, ResumeLab

There is no ideal answer as it truly depends on the individual’s needs and preferences

For starters, common wisdom dictates that it can make sense to have a checking account, savings account, and a retirement one.

Similarly, it’s not too far-fetched to have an investment account as well.

Now here is where the situation becomes very tailored. Some will want to compartmentalize a lot and thus want a separate account for monthly bills, healthcare, vacation fund, and or big purchases.

On the other hand, many are more than OK, using their main checking account for all of the above. After all, you can simply sort and filter your transaction history to find the exact type you’re looking for.

Thus, the answer is anywhere from 3-10 depending on how siloed you prefer to be with your various types of expenses.

Imani Francies


Finance Expert, Clearsurance

Open two or more bank accounts to manage finances

You should have at least two bank accounts. That should be a savings account and a checking account to divide your monthly income apart. You should put the amount of money that you spend in a month within your checking account and the part you intend to save into your savings account.

You can even have three bank accounts to help you follow the 50/30/20 model of financial management. When following this money management model, 50 percent of your funds will go towards necessities (bills. groceries, mortgage, etc.), 30 percent for spending money, and 20 percent for savings.

There are many financial calculators to use at home so you can strategically divide you money up to have two checking accounts and one savings account.

Alternatively, it is okay to open multiple saving and checking accounts with two or three banks. Each bank may offer a perk that benefits you. One may have interest rates and transaction rewards while another has low transfer fees that offer cash back when you use your debit card.

Therefore, splitting your money up to take advantage of the perks offered at different banks is a smart way to save money and to make your money work for you.

Linda Chavez

Linda Chavez

Founder & CEO, Seniors Life Insurance Finder

The more bank accounts you have, the better

Opening several bank accounts is a big benefit because it gives you more financial options, which eventually gives you more independence. It is not an issue to open as many accounts as you need as long as you can handle them.

We suggest opening at least two accounts, one for checking and the other for investing, as a bare minimum. Divide your monthly salary or benefit into two equal parts. Put the amount you normally spend each month into your bank account and the extra money into your savings account.

This strategy will assist you in getting the most out of your investment. It will provide you with more liquidity and access to funds while also assisting you in the accumulation of wealth.

Colin Palfrey

Colin Palfrey

CMO, Majesty Coffee

You should have at least 4 bank accounts

It’s advisable to have several bank accounts to easily keep track of your financial goals.

Expense accounts

This is usually a checking account or your payroll account with a debit card attached to it. This account is responsible for your regular expenses such as food, bills, gas, etc. Your money normally doesn’t stay a long time in your expense account. Having a separate expense bank account makes it easier to track expenses and prevent overspending so that you are sure to live within your means.

Savings account

Use a savings account for planned expenses or projects such as a long holiday trip, a new car, or a house renovation. This account should be easily transferred into and ideally difficult to withdraw from. It would be a good idea to have a separate savings account for each project. Having this kind of savings account makes it easier to plan for these kinds of expenses.

Emergency Fund account

This is an account in which you set aside funds for emergencies. It needs to be a relatively safe account but also accessible in an emergency. Ideally, this account should yield high interest and the cash can be immediately withdrawn, or at the most, in one day. Set aside at least 3 to 6 months’ living expenses in your emergency fund account.

Investment account

This account is used for the sole purpose of funding your investments and is usually the last account to be set up among the four bank accounts. It’s important to obtain income generating assets (investments) so that you can have passive streams of income. Then, you won’t need to rely solely on your paycheck. This is where an investment account can help you.

You can have other bank accounts, depending on your needs. These four, though, are the most essential ones.

Kevin Mercier

Kevin Mercier

Travel Blogger

For salaried individuals

Most people, or even couples, have a single joint account that’s either a saving or a checking account. That, however, is not a great idea, particularly for salaried individuals as certain retirement accounts are created for just one person.

Apart from that, a salaried person should maintain two individual accounts and divide their earnings between the two. The checking account can be used to pay bills, utilities, groceries, and other expenses while the savings account can be used for earning interest.

A Muslim, on the other hand, that is forbidden to take interest on religious grounds should also make two separate accounts, particularly a “Wadiha” (Current Account) and a “Mudarabah” (Profit-sharing & Loss-Bearing account). The latter can be used as an investment to earn potential returns.

Furthermore, to take advantage of the FDIC insurance maximum which is $250,000. You can get more insurance on your accumulated cash balances by creating separate bank accounts. So the amount of cash that you need to be insured should decide the number of bank accounts you should keep.

For persons with businesses

Rules regarding the number of bank accounts remain the same for individuals with businesses, however, they should make an extra account for each of the businesses that they run.

Business taxes can be very complicated so to prevent a mix-up, be sure to keep your business accounts separate from your personal ones. This can make calculating taxes easier while also giving you the ability to assess your business’ performance.

Charles McMillan

Charles McMillan

Founder, Stand with Main Street

“Never put your eggs in a single basket.”

his famous saying could probably be the first and foremost reason why you need multiple bank accounts. However, in my own point of view, having multiple bank accounts is also a way to reach your financial goals.

Open at least two bank accounts

My advice is to open at least two (2) bank accounts, one is for checking accounts and one is for savings accounts. I remember when I was still living from paycheck to paycheck, I always divided my salary into two, and put the amount which was allocated to my monthly expenses into my checking account, while the rest of the money or my savings was on the savings account and let my money stay there.

The reason why I did this and would want to share with everyone is that I had listed my financial goals and timeline that I needed to reach. While others listed their bucket list in life, I had my bucket list in my financial status.

I listed the goals on when I should reach my first hundred thousand dollars, my first half million, my first million, and so on, and these financial goals kept me motivated to boost my savings. In addition, it also gave me peace of mind that I was prepared financially when the time I needed to face an emergency came.

Chis McGuire

Christopher McGuire

Founder, Real Estate Exam Ninja

The number of bank accounts depends on your financial capacity and needs

There are no hard and fast rules in knowing how many bank accounts you should get. It all boils down to practicality. You may have as many as you want as long as it answers a specific purpose. However, having at least three bank accounts can be considered ideal.

One as a savings account or money that you don’t touch that offers higher interest and limits your withdrawals. Another account is a checking account that can be used for your spending purposes. At the same time, another one can be as a retirement account.

Depending on your spending and savings capacity and needs, you can make a decision that will help you manage your finances better.

Lianne Sanders

Lianne Sanders

HR Manager, Total Shape

Having multiple bank accounts seem like too much for one to handle, and is a waste of resources. However, what I have learned is that it’s important to separate your earnings accordingly to avoid any financial distress in the future.

Ideally, you should have at least 3-4 bank accounts mainly the following:

  • A business account, where you deposit your business earnings and would have a regular transaction flow since it’s the money you will use for business transactions.
  • A personal savings account, where you deposit your savings, which includes an emergency fund, and the money that you won’t use anytime soon. It’s better if your personal savings are put in a passbook type so there’s no easy access for you.
  • An expense account, where you deposit all the funds which you will need for bills payment, and all your daily expenses which may or may not include the allowance you set for yourself. It’s ideal that this has an ATM since you will be regularly using this account.

Natalie Maximets

Natalie Maximets

Certified Life Transformation Coach, Online Divorce

You can have any number of bank accounts, but it is best to have at least two

One is checking, and the other is for savings. It’s better to distribute money in such a way that you do not deduct funds from the savings account on a monthly basis.

If you have your own business, then your accounts must be separated. You shouldn’t make personal payments from a business account. This is important from a financial and legal point of view. You can also set up a separate account to save funds for your child’s college or support adult parents.

In general, the number of accounts depends on your needs, but it is still recommended to have at least 2. As for me, I have 3 bank accounts: checking, for savings, and an account for receiving payments from abroad.

Sabrina Anthony

Sabrina Anthony

Online Marketer | Founder, Budgeting Faithfully

Newlywed budget

My husband and I started a joint budget after we were married about 30 years ago. We started with one checking account and one savings account. We quickly learned this was not going to work.

First, of all, our combined paychecks we directly deposited in the one checking account. This made it almost impossible to determine what funds were to pay the household bills and what funds were for personal expenses. Secondly, I worried constantly that we would overspend and not be able to make the mortgage payment. Something had to change because I was always stressed about overspending.

The honeymoon was over

My husband was the first one to request a separate checking account because I was always on him about the funds being needed for the house. This type of budgeting made it almost impossible for him to spend his money freely on things that he desired. It also caused a great deal of friction in the relationship.

It took just another year or two for me to follow suit. I soon experienced the same restriction of always being worried about having available cash to cover expenses. This severely curtailed my ability to have fun or reach any personal financial goals. It was time to revamp the budget entirely.

New equal but separate accounts

I reviewed our joint budget to determine how much would be needed to run the household and we both deposited our set amount to cover those expenses. I opened up a separate checking for myself and a savings account to begin to meet my own financial goals.

The original checking count was earmarked for household expenses only. From that account, I paid out all the bills and transferred funds to the household emergency fund. We cheerfully went our separate ways and cut down on many financial disputes. It also reduced my stress levels substantially.

Happily ever after

To recap, we run the household with three checking accounts and three savings account. With the first checking account and a strong budget, we can take care of household expenses. With the two additional checking accounts we can freely spend on personal expenses and goals.

Also, with the three separate saving accounts, we were able to save for household emergencies i.e. home repairs and furnishings. With the two additional savings account, we could now save for personal emergencies such as loss of a job, car expenses, or medical emergencies.

We have never been happier.

Frequently Asked Questions 

What happens if I don’t use my bank account for a long time?

If you don’t use your bank account for a long time, it may become inactive or dormant. The exact length of time before an account becomes inactive depends on the bank and the type of account, but it is usually around 12 to 24 months.

When an account becomes inactive or dormant, the bank may begin charging fees or close the account altogether. Fees for an inactive account can range from a few dollars to several hundred dollars per month, so you must be aware of the costs associated with your account.

To avoid inactivity fees or account closure, use your bank account regularly by making deposits and withdrawals. Even small transactions like transferring a few dollars between accounts every few months can help keep your accounts active and avoid potential problems.

How do I decide which bank to choose for my accounts?

Research different banks: Start by researching several banks and comparing their features, such as interest rates, fees, customer service, and online banking options. You can also read reviews and ask friends and family for recommendations.

Consider your banking needs: Consider your banking needs and preferences, such as whether you need a local branch and ATM, mobile banking options, and the ability to deposit checks remotely. Choose a bank that meets your needs and offers the best value.

Pay attention to the location: Consider the bank’s location and ATM network. If you prefer to go to a branch, choose a bank with branches near your home or work. If you travel or relocate frequently, look for a bank with a nationwide or international ATM network.

Check the bank’s mobile app: A good mobile banking app can make it easier to manage your accounts, transfer money and pay bills. Look for a bank with a user-friendly and secure mobile app that meets your needs.

Watch for promotions or special offers: Some banks offer promotions or special offers for new customers, such as cash bonuses or interest rate discounts. Consider these offers if they fit your banking needs.

How can I ensure the security of my multiple bank accounts?

Keeping multiple bank accounts secure is vital to protect your funds and prevent fraud or identity theft. Below are some tips on how to ensure the security of your multiple bank accounts:

– Use strong and unique passwords for each account.
– Enable two-factor authentication for added security.
– Avoid public Wi-Fi and use a private network.
– Monitor your accounts regularly for suspicious activity.
– Keep your computer and software up to date.
– Avoid phishing scams and be wary of unsolicited requests for your information.
– Keep your personal information private and secure.
– Check your credit reports regularly.
– Use reputable banks with strict security policies.
– Educate yourself about the latest security threats and scams.
– Consider using an identity theft protection service.

What are the most common mistakes to avoid when opening multiple bank accounts?

Not keeping track of your accounts: With multiple bank accounts, losing track of your balances and transactions can be easy. Make sure you keep a record of all your accounts and review them regularly to ensure accuracy.

Overdrawing accounts: Be careful not to overdraw your accounts, as this can lead to fees and hurt your credit score.

Not taking advantage of benefits: If you have multiple bank accounts, make sure you take advantage of any benefits or rewards programs they offer, such as cashback or interest rate bonuses.

Forgetting inactive accounts: If you have an account that you no longer use, do not forget about it! Close the account or transfer the money to another active account to avoid dormant account fees.

Opening too many accounts: While having multiple bank accounts can be beneficial, opening too many accounts can be overwhelming and challenging to manage. Consider opening only accounts that serve a specific purpose and closing all unnecessary accounts.

What should I do if I have lost track of my bank accounts or forgotten some of them?

Check your credit report: Your credit report lists all your active accounts and accounts that have been closed in the last seven years.

Contact the bank: If you remember the bank’s name where you opened the account, contact them and provide any identifying information, such as your name, Social Security number, and date of birth.

Search your records: Check your old bank statements, emails, or records to see if you can find any information about your forgotten accounts.

Consolidate accounts: If you have multiple accounts, consolidate them to make it easier to manage and keep track of them.

Do I need to close my old accounts when I open a new one?

Whether you should close old accounts depends on your individual financial situation. If the benefits of an old account outweigh the potential drawbacks, it may be worth keeping it open.

However, if you are no longer using an account and it costs you money in fees, closing it may be the best solution.
Pros of closing old accounts:
Reducing the risk of fraud. If you have multiple open accounts, it can be harder to keep track of all of them and monitor them for fraudulent activity.

Simplifying your finances. Having fewer accounts makes it easier to manage your money and avoid confusion.

Avoiding fees. Some banks charge monthly fees for keeping accounts that are not used regularly or for keeping them inactive.
Cons of closing old accounts:
Potential impact on credit score. Closing an old account can lower the average age of your credit history, which can negatively impact your credit score.

Loss of access to benefits. Some older accounts may offer benefits, such as higher interest rates or waived fees, that you would lose if you closed the account.

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