Multiple bank accounts - am I crazy?

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benevo
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Multiple bank accounts - am I crazy?

Post by benevo » Fri Feb 02, 2018 2:13 pm

Happy Friday, Bogleheads!

Sometimes, I wonder if I have too many bank accounts - then I heard from someone recently who has 12, and I feel better.

I currently have 5 bank accounts:
1. Schwab checking
2. American Express Personal Savings
3. Capital One 360 checking
4. Capital One 360 savings
5. Local credit union

(I also have a small business checking/savings but I consider those a bit different so they aren't relevant for my ultimate question in this post.)

1. I use Schwab only for spending money/anytime I need cash from an ATM/ATM rebate
2. I use AmEx for all long-term (including emergency) savings
3. I use CO360 checking for most credit card/daily expense payments
4. I use CO360 savings for short-term savings (e.g., monthly/quarterly bills - collects a bit more interest)
5. I use local credit union just really to have a brick and mortar bank

I recently came across the need for a cashier's check - Schwab can overnight them/mail them, and I think CO360 as well, however there's no in-person place to handle this. My local credit union is pretty awful, and I'd ideally like to leave them.

Do I leave the credit union and have no brick and mortar accounts, or do I open a Chase checking account and keep the minimum balance in it so that I don't pay any fees? (Why Chase?: there are a bunch nearby, and seems best of the brick and mortar - also running a $300 promo with a new checking account.) I'm leaning toward the second, as I do like the idea of having a brick and mortar...what do I do otherwise when I find a bag of cash on the road!? (Ha ha ha.)

Of course, I don't pay fees in any of my current banks, so it's really just a matter of - is 5 too many?

Thoughts?

-be

runner3081
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Re: Multiple bank accounts - am I crazy?

Post by runner3081 » Fri Feb 02, 2018 3:06 pm

We keep our Chase (formerly WaMu) account open with $1500 in there to have a local presence. Works great for notaries, cashier checks, cash deposits, etc.

Otherwise, Ally is our main bank.

mptfan
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Re: Multiple bank accounts - am I crazy?

Post by mptfan » Fri Feb 02, 2018 3:07 pm

Yes, 5 is too many. I have one.

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flamesabers
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Re: Multiple bank accounts - am I crazy?

Post by flamesabers » Fri Feb 02, 2018 3:13 pm

The appropriate number of bank accounts to have is subjective I think. If you're fine with managing five bank accounts then I wouldn't say you have too many bank accounts. There are good reasons to have a small number of bank accounts and there are good reasons to have multiple bank accounts.

benevo
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Re: Multiple bank accounts - am I crazy?

Post by benevo » Fri Feb 02, 2018 3:14 pm

runner3081 wrote:
Fri Feb 02, 2018 3:06 pm
We keep our Chase (formerly WaMu) account open with $1500 in there to have a local presence. Works great for notaries, cashier checks, cash deposits, etc.

Otherwise, Ally is our main bank.
What's Chase's fee for cashier checks? I'm seeing mixed info online!

essbeer
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Re: Multiple bank accounts - am I crazy?

Post by essbeer » Fri Feb 02, 2018 3:19 pm

If you are counting separate accounts at the same bank as multiples, then my wife and I must have at least a dozen across 5 or so banks. As long as I'm not paying fees, I've never really considered it a problem.

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sunny_socal
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Re: Multiple bank accounts - am I crazy?

Post by sunny_socal » Fri Feb 02, 2018 4:16 pm

You're not weird.

I have:
- 4 Credit cards (actually a couple more as well, but I never use them)
- 5 Checking Accounts
- 5 Savings accounts
- 1 Money Market
- 1 HELOC
- Multiple brokerage accounts


All have a slightly different purpose. A few are just sitting there doing nothing but I have established "connections" between the banks and it's easier to just leave them in place in case I need to transfer funds. Setting up new transfer relationships can be time consuming.

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brother7
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Re: Multiple bank accounts - am I crazy?

Post by brother7 » Fri Feb 02, 2018 4:21 pm

I have 3 savings + checking accounts at 3 separate credit unions and I just added a 4th. I love credit unions!

Greentree
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Re: Multiple bank accounts - am I crazy?

Post by Greentree » Fri Feb 02, 2018 4:27 pm

I just went through a process to simplify my accounts. I also had capitalone, as well as vanguard and chase. I moved everything (except a little bit that stays at chase) to fidelity, since that is where my 401k is. I just like knowing that if I get hit by that bus there is one place for my wife to look.

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Pajamas
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Re: Multiple bank accounts - am I crazy?

Post by Pajamas » Fri Feb 02, 2018 4:28 pm

I think it is good to have an established business relationship with at least two banks, two credit card providers, two brokerage firms, etc. in case you need to sever the relationship with one. It can be a pain to find and establish a relationship with a new institution and that gives you some flexibility and protection. Seems like you could simplify some, though.

Dandy
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Re: Multiple bank accounts - am I crazy?

Post by Dandy » Fri Feb 02, 2018 4:48 pm

5 is a bit much. The key is that you are getting valued service or products from each. I think having more than one is a good idea. Banks often change there fees/minimums/rates etc. especially on checking. Having some alternative already in place makes changing banks easier. That is the reason I have pensions/SS sent to an online bank SAVINGS and then sent to another bank's better checking - easy just to send money to a checking account at new bank/credit union.

Also if there is a fraud or some other issue with one bank you can use another bank until the issue is resolved.

I have 3
1. brick bank- local that we are used to use for free checking/atm/billpay and HELOC . Trying to wean ourselves from this bank. But nice to have a convenient local bank and human to actually meet if there is an issue. Terrible rates.
Have to keep some balance and a minor automated deposit to avoid fee.

2. On line bank - Savngs/Money Market account - have pensions and my SS sent to savings and 2X a month money sent to the credit union checking described in #3 below. Competitive rates on Savings and Money Market. 24/7 service.

3. on line credit union - nice interest on checking and good savings rate. Atm fee reimbursement, 24/7 service.

Note: I do have a Vanguard Advantage Account that was going to be my main "bank" with unlimited check writing etc. When Prime/Fed money rates were so low it didn't make sense but it now pays 1.29% so I'm thinking about it. Vanguard has nice Brokerage CD rates compared to the other choices. But concerned about no 24/7 service.

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Ged
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Re: Multiple bank accounts - am I crazy?

Post by Ged » Fri Feb 02, 2018 4:56 pm

I like to have at least two - credit cards and bank accounts in case something goes wrong with one of them.

runner3081
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Re: Multiple bank accounts - am I crazy?

Post by runner3081 » Fri Feb 02, 2018 4:57 pm

benevo wrote:
Fri Feb 02, 2018 3:14 pm
runner3081 wrote:
Fri Feb 02, 2018 3:06 pm
We keep our Chase (formerly WaMu) account open with $1500 in there to have a local presence. Works great for notaries, cashier checks, cash deposits, etc.

Otherwise, Ally is our main bank.
What's Chase's fee for cashier checks? I'm seeing mixed info online!
Depends on your account level. I paid $8 last time with Total Checking.

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Ice-9
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Re: Multiple bank accounts - am I crazy?

Post by Ice-9 » Fri Feb 02, 2018 5:14 pm

You think that's crazy? Hold my beer. :D

Back in 2005-6, as there was a lot of competition among online savings accounts, I followed a lot of finance blogs and got into rate chasing for some reason. As vestiges of that era, I have a bunch of accounts that today I use for different purposes.

* Presidential Checking and Savings - This bank is actually local to me, so this is my brick and mortar bank for depositing cash and when I need face-to-face services.

* Capital One 360 Checking and (multiple) savings - Money gets scheduled to transfer from main savings to checking the day before due date for credit card, when I've scheduled a pull. (I regularly use five cards, so this is within the six-withdrawal-per-month limit.) The dog also has a subaccount here, where what would have been pet insurance payments automatically transfer from each paycheck as a way to self-insure. My dog is also a very reasonable lender.

* FNBO Direct Savings -higher APY (currently 1.40%) but less robust interface, so longer term savings for big things that require less frequent interaction go here.

* Emigrant Direct Savings - Hasn't offered an attractive rate in years, so don't really use this one. But I needed some account to connect to Paypal for very rare usage, and I don't trust PayPal very much, so I keep a few dollars at ED to keep the account open for that purpose.

No fees at any of them. The only real minimum is $1000 in the Presidential Checking, which would be a $5 fee for any month I fell below that line.

student
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Re: Multiple bank accounts - am I crazy?

Post by student » Fri Feb 02, 2018 6:02 pm

I have at least 5.

herpfinance
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Re: Multiple bank accounts - am I crazy?

Post by herpfinance » Fri Feb 02, 2018 6:51 pm

As long as each account provides a reasonable benefit, I don't think it's crazy.

I have access to checking accounts at three different banks. One bank I only used because it offered the best rates on a savings account, but I've since emptied my accounts there as that's no longer the case. Another bank I only opened an account with because they offered one of the lowest cost equity mutual funds in my country (ETF's are usually not feasible outside of retirement accounts due to unfavorable taxation).

A fourth bank I only have an account at because they have the most attractive credit card for my usage pattern (no fees as long as the balance is paid in full every month).

A fifth bank I have a savings account at because they currently have the best rates.

Finally I have my investments across three different brokerages, bringing the grand total to eight financial institutions. Oh, nine if you count my employer-based retirerment and insurance plan.
"The intelligent investor is a realist who sells to optimists and buys from pessimists" - Benjamin Graham

Dottie57
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Re: Multiple bank accounts - am I crazy?

Post by Dottie57 » Fri Feb 02, 2018 6:57 pm

Ged wrote:
Fri Feb 02, 2018 4:56 pm
I like to have at least two - credit cards and bank accounts in case something goes wrong with one of them.
This I understand. But not 5.

I have 2credit cards. 1 checking. One money market.

denovo
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Re: Multiple bank accounts - am I crazy?

Post by denovo » Fri Feb 02, 2018 6:59 pm

One checking account is enough.
"Don't trust everything you read on the Internet"- Abraham Lincoln

benevo
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Re: Multiple bank accounts - am I crazy?

Post by benevo » Fri Feb 02, 2018 7:19 pm

denovo wrote:
Fri Feb 02, 2018 6:59 pm
One checking account is enough.
Nice to meet you denovo, I'm benevo. Are we cousins?!

denovo
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Re: Multiple bank accounts - am I crazy?

Post by denovo » Fri Feb 02, 2018 7:20 pm

benevo wrote:
Fri Feb 02, 2018 7:19 pm
denovo wrote:
Fri Feb 02, 2018 6:59 pm
One checking account is enough.
Nice to meet you denovo, I'm benevo. Are we cousins?!
Could be. :sharebeer
"Don't trust everything you read on the Internet"- Abraham Lincoln

denovo
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Re: Multiple bank accounts - am I crazy?

Post by denovo » Fri Feb 02, 2018 7:23 pm

I don't see why the savings accounts can be merged.

I like the idea of having a brick and mortar account so I'd go with Chase and say goodbye to the credit union and cap one checking. Simplicity is great. Autopay on bills is even more fun.
"Don't trust everything you read on the Internet"- Abraham Lincoln

darrvao777
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Re: Multiple bank accounts - am I crazy?

Post by darrvao777 » Fri Feb 02, 2018 7:26 pm

1 bank

2 credit cards

Love the simplicity

kite
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Re: Multiple bank accounts - am I crazy?

Post by kite » Fri Feb 02, 2018 7:38 pm

I have over 30 bank accounts. Each of them has their own specific purpose that I take advantage of and none of them include any fees. What's wrong with multiples?

denovo
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Re: Multiple bank accounts - am I crazy?

Post by denovo » Fri Feb 02, 2018 7:40 pm

kite wrote:
Fri Feb 02, 2018 7:38 pm
I have over 30 bank accounts. Each of them has their own specific purpose that I take advantage of and none of them include any fees. What's wrong with multiples?

Hard to keep track of 30 bank accounts I would think :shock:
"Don't trust everything you read on the Internet"- Abraham Lincoln

kite
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Re: Multiple bank accounts - am I crazy?

Post by kite » Fri Feb 02, 2018 7:42 pm

denovo wrote:
Fri Feb 02, 2018 7:40 pm
kite wrote:
Fri Feb 02, 2018 7:38 pm
I have over 30 bank accounts. Each of them has their own specific purpose that I take advantage of and none of them include any fees. What's wrong with multiples?

Hard to keep track of 30 bank accounts I would think :shock:
Spreadsheets make tracking things easy. And there's not much to track... Bank - Balance - Perk :moneybag :moneybag

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Ged
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Re: Multiple bank accounts - am I crazy?

Post by Ged » Fri Feb 02, 2018 7:43 pm

Dottie57 wrote:
Fri Feb 02, 2018 6:57 pm
Ged wrote:
Fri Feb 02, 2018 4:56 pm
I like to have at least two - credit cards and bank accounts in case something goes wrong with one of them.
This I understand. But not 5.

I have 2credit cards. 1 checking. One money market.
Some people hate to cancel their oldest credit card because it can lower their credit rating. I have an old one that I've had for 25 years. Other cards can also have special discounts attached to them etc.

But checking accounts - I don't think I will ever want more than two.

DetroitRick
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Re: Multiple bank accounts - am I crazy?

Post by DetroitRick » Fri Feb 02, 2018 7:46 pm

I don't see any particular problem with multiple accounts - we have 6 (2 checking, 4 savings). Using 21st century tools, I don't think this creates any additional work on my part. Money moves easily and none of our accounts have fees. Quicken let's me view it all in an instant too (same with Mint and the other alternatives).

In no particular order here are the advantages I realize, at least for our particular situation:
- Some banks and credit unions offer services that others don't, or do so cheaper. I've found no bank to be "best" for everything over time.
- Rates, low though they are right now, change constantly and I can put money wherever it works best at the moment. Without opening new accounts. Plus, sometimes I can get those teaser rates by moving money or opening a cd.
- Having assets in multiple places, including both web-only and brick & mortar, can be advantageous should I have to temporarily suspend use of a bank due to fraud (never happened to me yet, but certainly possible).

For some people, FDIC limits can potentially come into play.

25 years ago, it would have been a hassle. Now, not at all.

JGoneRiding
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Re: Multiple bank accounts - am I crazy?

Post by JGoneRiding » Sat Feb 03, 2018 12:39 am

I have 10. No wait 11

Was this a contest?
I have 2 online savings (CO 360 n Ally) I opened Ally cause 360 rate was going so poorly. I have check n savings with a credit union cause they had a great rate and good loan products and I just haven't closed I keep it as slush. I have Charles Schwab checking cause I need it to transfer in and out with the brokerage. I have 3 local checking acct with 2 linked savings because of rental houses(all at the same bank). And finally I have smarty pig because I like the savings buckets and the rate is ok

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celia
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Re: Multiple bank accounts - am I crazy?

Post by celia » Sat Feb 03, 2018 12:58 am

If you need/want to hold a lot of cash, you may NEED to have multiple banks accounts to have all your money covered by FDIC insurance. FDIC will only insure the first $250,000 in each bank (including all their branches) for each type of account registration.

On the other hand, whoever closes your estate may not find all your bank accounts and the estate will leave money "on the table". And then after 3 or 5 years (I think) of no activity in the account, the money should revert to your state's Unclaimed Property division. If your executor/trustee thinks to check there after several years, she can file claims to receive the money and then distribute it, but this is not the best situation to be in.

That said, we have 5 local bank accounts, each holding a relatively small amount for a specific purpose. :D

bluelight
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Re: Multiple bank accounts - am I crazy?

Post by bluelight » Sat Feb 03, 2018 1:03 am

We have 3 checking and 4 savings accounts spread over 2 banks and a credit union.

Local NJ bank where I lived for 25 years. My husband and I are second timers married for 4 years. We each had a checking and savings account at this bank and decided to just add each others names to the accounts. These are still the main checking accounts and 95% of deposits and bills go through them. I have them linked together and move money as needed. The accounts allow me to have free access to Finance Works were I track all spending which I then download to a spreadsheet at the end of the year.

TD bank - We have 1 joint checking and savings account in NY. We use it mostly for the ATM and occasional local bills that need a check instead of bill pay.

Credit Union savings account. I rarely touch this account and am considering closing it. It had paid decent interest in the past, but not so much anymore. I keep it mostly as an emergency fund.

18_bank_accounts
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Re: Multiple bank accounts - am I crazy?

Post by 18_bank_accounts » Sat Feb 03, 2018 1:19 am

Seems fine to me.

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Doom&Gloom
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Re: Multiple bank accounts - am I crazy?

Post by Doom&Gloom » Sat Feb 03, 2018 1:19 am

We have three--2 individual and one joint.

I don't see a need for more, but if there is a convincing reason, then ...

inbox788
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Re: Multiple bank accounts - am I crazy?

Post by inbox788 » Sat Feb 03, 2018 3:44 am

Ged wrote:
Fri Feb 02, 2018 7:43 pm
Some people hate to cancel their oldest credit card because it can lower their credit rating. I have an old one that I've had for 25 years. Other cards can also have special discounts attached to them etc.

But checking accounts - I don't think I will ever want more than two.
I've been trying to cut down, but 2 years ago, wound up opening a few more instead. Last year, I went ahead and closed some, including my oldest credit card. I've been tracking my credit, and so far, no impact to my credit score. The cards that I closed only recently disappeared from the report of active cards, but the oldest account age is still showing the closed account. I wonder if it stays as part of the calculation as long as the record is on file. I hope so.

TwstdSista
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Re: Multiple bank accounts - am I crazy?

Post by TwstdSista » Sat Feb 03, 2018 6:12 am

We have too many accounts as well, but they all have a purpose and simplifying isn't possible without either a hassle or giving up a benefit we enjoy. So we just deal. I have them all listed out for either the husband or the future executor of our estate(s).

marstaton4
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Re: Multiple bank accounts - am I crazy?

Post by marstaton4 » Sat Feb 03, 2018 6:57 am

I've got 4.

2 at Schwab with 1 being used for business

1 at Fidelity for my 2% cashback card deposits

1 at a local bank for notaries and handling cash

I'd like to have less but it doesn't currently seem possible.

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tennisplyr
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Re: Multiple bank accounts - am I crazy?

Post by tennisplyr » Sat Feb 03, 2018 7:42 am

No. It's a judgement call, I have 2 for different reasons.
Those who move forward with a happy spirit will find that things always work out.

blevine
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Re: Multiple bank accounts - am I crazy?

Post by blevine » Sat Feb 03, 2018 7:54 am

3 for bookeeping purposes at one internet bank
1 cash mgmt at brokerage used for employer stock
1 local brick and mortar so i have a branch when needed

Over time, will simplify.
When I retire, employer stock brokerage acct may go.
Internet bank will likely consolidate to one acct once my original bookeeping purpose is done.
Brick and mortar stays unless I move out of the area (in which case maybe will open elsewhere, maybe not).

I have not found it to be a pain, and having only one is not a goal. I use paypal and other services where I give out ach / eft bank acct details. Not going to give my primary acct, only an acct with minimal balances. So two is the minimum for me.

rec7
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Re: Multiple bank accounts - am I crazy?

Post by rec7 » Sat Feb 03, 2018 8:49 am

I have 5 credit unions and 1 bank. Only one of them is not in use for something. I don't think it is a big deal as long as their are no fees.
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fourwheelcycle
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Re: Multiple bank accounts - am I crazy?

Post by fourwheelcycle » Sat Feb 03, 2018 8:59 am

Five may be a bit much, but I understand why you would have more than one.

For many years we only had one bank, the local BoA, for all of our checking, savings, and credit cards. Even our AAA credit card was, and still is, a BoA card. However, after 2008 BoA became increasingly cost-conscious (cheap?). First they dropped their Medallion signature service and recently, amazingly, they even stopped offering a notary service.

We seem to need Medallion signatures about once every second or third year and notary signatures a few times each year. The last time I needed a Medallion signature I searched around and found a small, local-only, bank that still does free Medallion and notary signatures. I opened a savings account just for access to their signature services and asked them about their range of banking and credit card services to see if they might be a candidate to move all of our banking. It turns out they only have their own local ATMs, with no affiliated links to ATMs elsewhere in the US or Europe, they do not offer any cash reward or no-foreign transaction fee travel cards, both of which we have at BoA, and they have limited provisions for ACH transfers to places like Vanguard and online high interest savings banks. We need all these services, so we are still at BoA for everything except Medallion and notary signatures.

UpperNwGuy
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Re: Multiple bank accounts - am I crazy?

Post by UpperNwGuy » Sat Feb 03, 2018 9:34 am

Two credit unions, each with checking, savings, and credit card. I've been with one since 1974 and the other since 1993. Both credit unions are linked to Vanguard.

I also have two Chase credit cards (for the travel rewards) and one credit card at a third credit union (for true chip+PIN capability overseas).

Rashen
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Re: Multiple bank accounts - am I crazy?

Post by Rashen » Sat Feb 03, 2018 9:54 am

in my opinion, 5 is 3 too many
1 for checking
1 for savings
the rest should be invested, not merely spread out across different banks

3funder
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Re: Multiple bank accounts - am I crazy?

Post by 3funder » Sat Feb 03, 2018 10:02 am

I have two; if I had my way, I'd have one.

uslee2004
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Re: Multiple bank accounts - am I crazy?

Post by uslee2004 » Sat Feb 03, 2018 10:42 am

Have way more than 5. 3 checking accounts in same bank non-local to us, which was our original online banking. We keep most of our transactions there still. Decent (0.4%) for these checking accounts.
A checking and saving at the credit union where DW works.
TD bank checking stayed open mostly because our son's school reading saving account is there.
Ally & CIT saving accounts, and a mango card account.
Wellsfargo PMA when it was offered.

I did closed a few more last year.
uslee

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Toons
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Re: Multiple bank accounts - am I crazy?

Post by Toons » Sat Feb 03, 2018 10:45 am

Not Crazy,,just
Not Necessary.
Simplify





:mrgreen:
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

ETCS10
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Re: Multiple bank accounts - am I crazy?

Post by ETCS10 » Sat Feb 03, 2018 2:27 pm

3 Checking, 1 savings and 4 CC between the wife and I.
USAA ck has my military retirement deposited and automatic withdrawals to both IRA's, Term life policy, Capital 360 savings, and VG taxable account. Pretty much my entire retirement pay to savings/retirement

NFCU ck my current jobs pay goes here and it's we live off of with extra to splurge on the grandkids. Also they offer some good short term CD's.

Chase ck had since WaMu days about 20 years. I don't touch this account anymore wife pay goes in, small part-time job about $600 a month, and soon her SS its all hers to do what she wants. Also have a safety security box there.

Capital 360 savings mainly used for replacement vehicle, house repair, etc

CC's USAA rewards, USAA (prior to rewards) Shell MC, and her card (don't know what kind she pays it from her account).

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smegal
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Re: Multiple bank accounts - am I crazy?

Post by smegal » Sat Feb 03, 2018 2:45 pm

We keep our Chase (formerly WaMu) account open with $1500 in there to have a local presence. Works great for notaries, cashier checks, cash deposits, etc.

Otherwise, Ally is our main bank.
+1, works well

mariezzz
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Re: Multiple bank accounts - am I crazy?

Post by mariezzz » Sat Feb 03, 2018 3:14 pm

As others have said, the correct number is what works for you. You do have to remember to use them occasionally or at least transfer money in/out of them - so more adds to your work load. I keep very little money in them except Chase - and even there, it's just what I need for the next few weeks. Any other money (that isn't directed to a retirement account) goes into VMMXX (non-retirement)

I rarely use checks, but have to 4-6 times a year. I have Chase (formerly WAMU) as a primary account, mainly because I still have WAMU checks. Will keep until I run out of checks which may be 10+ years. By then, checks may be completely unnecessary.

I have a capital one checking account for foreign travel - this is my only account where there are no fees for withdrawing from foreign ATMs. I keep very little money in it unless I'm traveling. Before I travel again, I will set up a second Capital One account, so I have a backup ATM card (without fees) to use when traveling. (The last time I traveled, I wished I had done this, although didn't end up with any problems.)

2 credit unions: one local, one from somewhere I lived previously (e-account). I got free checks for opening both, so no reason to close as there is no minimum balance or fees (unless terms change).

At one time, had a Wells-Fargo (had gone through 3 name changes) and a Bank of America (2 name changes) but cancelled a few years ago when they stopped waiving fees and employer didn't allow pay check splitting.

Won't even discuss credit cards - I have many. Opening & closing accounts doesn't seem to have much impact on my credit score (around 800), and I don't plan on needing credit any time in the next few years.

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