How Many Bank Accounts If You Have?

Through time, several readers have asked some variant on that question, together with some questions. Checking account if I have? Savings account if I have? Should they be at precisely the exact same bank, or at different banks? Does having the probability of identity theft increases? Does having balances make money management harder?
I thought I’d handle those questions in one place all.
For People, There’s No Reason
That is the core of most of my banking information there. For the majority of individuals, having your fundamental banking services – a checking account and a savings account – at a single bank is most likely the best move.
There are a lot of reasons for this boil down to two big elements.
To start with, keeping your business makes accounts and banking management simpler. You know where to go with it In case you have a banking issue. You do not have to worry about multiple routing numbers checkbooks account numbers, and all that. You’ve got your money reducing the danger of items like overdrafts due to getting things spread out across multiple accounts and banks. You also may find it difficult to stay informed about minimal balances if you have your money spread across lots of accounts.
Secondly, the fewer banks that you do business with, the lower your chance of identity theft and account fraud. Your private data is simply in the control of fewer companies, thus there is a probability of an intrusion at a random bank hitting on your data.
That isn’t to say there is never a reason.
There Are a Few Reasons to Have a Second Bank
1 rationale is that you have a specific reason for wanting some of your money separate. For example in order to don’t have access to it you wish to have an emergency fund at a second bank. Your bank card is carried by you for your bank that only has your emergency fund, but although your main bank, you leave the card in a secure place.
It’s worth noting here that some banks offer you the ability to have savings account with ease. For example, Capital One 360 makes it easy to create multiple savings account for lots of goals.
Another reason is that you might be in the process of committing to another bank. When you proceed from 1 bank to another, it’s a fantastic idea to have a period of adjustment where you make sure you haven’t forgotten any automatic transfers or anything like that at your old bank as you’re mainly using your new bank fo everything. That stride interval is a superb reason to maintain two accounts open, but you’ll want to close the accounts out.
Another motive, and one that is not a good one in the economy, is that you’re chasing interest rates. At times when banks are offering higher rates of interest on savings accounts and CDs compared to 1% they’re offering today, it might make sense to have some money in savings account to move around fast to pursue the highest interest rate while maintaining money at your primary bank. I did so for a brief while in the mid-to-late 2000s, where banks were offering interest rates on savings account as large as 6% or 7 percent, but it was an era that quickly fizzled since the economy went into a solid recession then and interest rates on savings accounts haven’t rebounded since (though they might again, someday).
There are obviously relationship-related problems . Perhaps your spouse and you maintain separate accounts or there is a trust issue in your relationship or you’re preparing for separation.
Here is the issue: all these reasons are market reasons that don’t use to the majority of people. There is not enough value in chasing better rates of interest in CDs and savings accounts to bother with it. Individuals aren’t at any moment in the midst of a bank transition. Most individuals aren’t in a connection that’s in crisis (although quite a few individuals in long term relationships do maintain separate accounts – Sarah and I did, at first).
What Should I Have Extra Accounts?
If you’re in a circumstance where you have accounts at multiple banks for doing so, with no fantastic reason, I recommend closing the account you do use and centralizing your account. However, I close the accounts and would charge into a bank.
If I had been about to close a seldom-used accounts is look of statements for that account through the last year or so and determine if there are any deposits or deposits that are going through that account. For every one of those, I’d ensure those deposits and withdrawals were changed to undergo my checking account at the bank I have selected to use for banking. By visiting that division once you’re sure the accounts are not likely to be hit with trades any more, I’d close the account.
How do you decide which bank to use? For a key checking account and a savings account that will not be holding a balance, which is how many folks bank, I would not worry about rates of interest. Save that concern for situations and have sufficient money to make that rate-chasing rewarding.
I’d make sure there were no fees on fundamental account usage, that there is at least some easy access to a real person for client service problems, and there is robust banking available. That means that there is a local branch near you so that you can actually go in and talk to a teller or into a branch manager if there is a problem. Banking customer service by telephone can be lacking, and using everything work is something that you really, really want from your bank.
Final Thoughts
The core ideas here are easy.
It’s a wise idea entire to have your banking action all channeled through a single bank unless you have a specific reason for doing otherwise. This lowers the chance of identity theft and simplifies matters.
There are a few reasons for getting monies, but those problems are uncommon, and for many people, a single bank is likely the best alternative.
Focus more on decent customer service and low fees in the form of banking and also, if possible, direct access through using a local branch available near you when you’re choosing which bank to use as your main one.
Fantastic luck!