Katie Stiner

Opening multiple checking accounts can have significant advantages because it offers greater freedom by broadening financial opportunities.

As long as you can manage the accounts, there is no problem opening multiple accounts that fit well. Different types of checking accounts offer various services. 

Here are 9 advantages of having multiple checking accounts.

1. Finances are organized

Use a percentage-based budget to keep it simple. The idea is to divide income into different categories, spend a certain amount on needs, specific amounts on wants, and save the remaining. 

Separate the needs and wants in separate accounts. This way, you can confidently purchase the things you want without worrying about spending the money meant for your needs. This helps to avoid stressing your budget.

When using multiple checking accounts for budgeting, each account can have its own purpose. One can be used for paying bills, such as utilities, and another can be used for daily expenditure or for items that are needed for daily use.

2. Business and personal finances are separate

Having multiple accounts will help to keep business and personal use money separate. When running a business, it is important to periodically monitor the business performance to determine whether your business is growing or not.

Monitoring how the business account performs can give a clue of business performance. This will provide an easy indication of whether the business is making a profit or loss.

That’s why business owners have to have an account for business functions separate from their personal user account.

This will make bookkeeping more manageable. It can also help track your business-related expenses such as purchases, transport, labor, taxes, and other incidental costs.

3. Emergency funds are separate

Life is full of uncertainties. Unforeseen occurrences are part of life, and there is no question about that. The degree of emergency varies from one person to the other.

Some emergencies can claim life. Some bring financial and property damages—plan in advance to efficiently respond if the unforeseen happens.

4. Earn more interest while paying fewer fees

A basic checking account, for example, is cheap but has limited perks. On the other hand, an interest-bearing checking account earns good interest but requires a high minimum balance to be maintained.

A basic account can be used to pay bills while an interest-bearing account can be used to earn interest for your emergency funds.  Limit access to interest-bearing to grow savings.

5. Test various checking accounts

The decision to settle on one checking account might not be easy. Only after judging the benefit and service of an account makes it easy to settle on one over the other.

Make a right and informed decision on the service and benefits of an account after trying it out and assessed its usefulness.

After deciding on possible checking account options, narrow the field down to a manageable number, both financially and human power.

» Want to see your options? Here’s a list of the best checking accounts

6. Get different perks from the other accounts

Every checking account comes with different offers and with a traditional checking account, you will have a way to waive monthly maintenance fees. Some accounts do not have these monthly fees. Balances also tend to determine whether you will pay fees with the account or not.

Traditional accounts may also have overdraft services to help with purchases or withdrawals, even with an insufficient balance. There will probably be charges for a negative balance so be careful when making transactions.

A premium checking account has its own kind of advantages. Some of the benefits to this type of account are a free safe deposit box, personal and official checks, money orders, and fees waived on some or all out-of-network ATM usage. But the owner usually needs to maintain a higher minimum balance with this type of account.

A checkless checking account might not have overdraft fees. If you have forgotten the last time you wrote a check, this might be a desirable banking option.

Reward checking account that earns points or cashback on your debit card purchases. A private checking account may give you a higher debit card limit, free wire transfers, or more ATM withdrawals per day.

7. Enjoy bonuses and transfer of money between accounts

Banks entice new customers by checking account bonus promotions. These promotions give you cash in exchange for opening a new account.

Bonuses are an easy way to make extra money for your own spending or expansion of your business.

Online checking accounts offer much-needed convenience as they can be accessed through mobile phones or online platforms.

8. Make use of federal deposit insurance

Federal Deposit Insurance Corporation is a policy in the United States that insure individuals’ saving to a maximum of $250,000 per depositing institution.

This simply means that if a bank becomes bankrupt, you can recover from the FDIC insurance the amount up to $250,000.

If you have, $1,000,000 and deposit it in one bank, you will only recover a maximum of $250,000, and $750,000 will be lost. If you split the $1,000,000 into $250,000 in separate checking accounts with different banks, you can more likely recover the full amount.

9. Spread risks

Banks are not exempted from business risk and circumstances may force a bank to go under.  Even though you are covered under the Federal Deposits Insurance Corporation, it will still take time for you to get access to money through the policy.

Even if your balance is less than $250,000, you can still split the money into different accounts to lower these risks.

How many checking accounts should I have?

As many as you want, you are not limited on the number of checking accounts you can have. Instead, a choice should be made considering important factors such as financial goals, spending habits, and level of finances.

Also, consider the effort and time dedicated to managing multiple checking accounts.

Final thoughts

Having multiple checking accounts can be more efficient, flexible, and less risky.

Be aware that multiple checking accounts could lead to more maintenance fees, especially if the minimum balance requirement is not met or the account becomes inactive.

Compare the several types of checking accounts and if it will work, having another checking account.

Share your experience below with your checking accounts.

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