Multiple checking/savings accounts at different banks..good/bad idea?

[urbex]

I currently have checking/savings accounts at 6 different banks and CUs.  Partially due to a fear from many years ago of losing access to all my money due to a computer glitch and not having credit cards to fall back on, partially due to having loans serviced by credit unions. 

Many years ago, a friend of mine had Chrysler Financial screw up an auto pay, taking $5000 out of his account rather than the $500 that was supposed to be pulled, resulting in a string of overdrafts, and a nightmare to resolve.  Shortly after, I had my debit card frozen by my bank due to suspected fraud, because I had bought gas at 3 different locations across the state (road trip in a truck that got 5mpg on a small tank).  I called in literally about 3 minutes before they shut the phones down for the night, and thankfully got it unfrozen.  But had that happened only 5 minutes later, I would have had to sleep in the truck that night....thankfully, seems most all places have 24/7 card support via phone, so that's unlikely to happen today, but it's always stuck in my head. 

Ever since, I've made it a point to have accounts at least with two banks, then it started to grow as I thought "what if I need access to more than $1,000 cash after hours, and I can only pull $500 cash off each card at an ATM?" 

Now, many years later, I have enough credit cards in my wallet that having a debit card get frozen like that, or glitch overdrawing an account isn't a complete "I'm up the creek without a paddle" situation anymore.  Not that I'm saying a CC cash advance is a good idea, just that I have SHTF options, and I've yet to ever have a need to pull large amounts of cash in the middle of the night anyways. 

I held on to one of the CU accounts because they originally had branches open on Sunday locally, but switched branding and that went away.  Another CU pulled out of shared branching some years ago. 

Now I'm wondering if there's any kinds of "rules of thumb" on how many checking/savings accounts to hold on to?  Thinking about pareing down to keeping my Chase accounts for nationwide large bank access, and one of my CU accounts for shared branching access. 

But are there other compelling reasons to have a larger number, or even compelling reasons to have everything at one bank/CU?

[FicoMike0]

I agree with the "don't put all your eggs in one basket" idea. I have way too many accounts. I just closed two. Most of mine I opened for a sub or to establish a relationship. I only have one account that's not no fee, no min., So it doesn't take much effort to maintain an account with $10-15 in it.

Do I use my amex checking? No, but I have a credit card with them, so I have their app on my phone anyway. I also think they have a nice debit card design, lol.

Why have two brokerage accounts? I use fidelity as my primary checking and investment accounts, but robin hood offers no fee options trading. 

[heyryan]

I don't think there's necessarily a rule of thumb - a lot of it comes down to your individual situation. I do think you have the right idea having more than 1 place to access your funds. For me personally, I keep enough money in at least 2 different banks/CUs to cover my expenses for a couple of months in case something happened with my primary account. One is a bank with a local branch that doesn't pay much interest, but is there if I need to go into in person. The other is a CU with a rewards checking account that I just treat as a savings account, but if needed I have access to bill pay, etc. 

Beyond that, it depends on if the accounts offer you any additional benefits, if they're free/no-fee, and how many are you comfortable juggling? For me, I have probably 20+ open currently. Some were for SUBs, some are with CUs that I wanted a CC or CD from, some are for the interest rates they pay. I use Quicken to keep track of everything, so I'm ok with that number. If there's no minimum balance, monthly fee, etc. I'll usually keep them open just in case I may want another product from them in the future. 

I guess the tl;dr version is do what makes you feel the most comfortable that your money is safe and you have access to enough if something were to happen to an account. That'll help minimize your stress level hopefully if there were any issues

[urbex]

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@heyryan wrote:

Beyond that, it depends on if the accounts offer you any additional benefits, if they're free/no-fee, and how many are you comfortable juggling?

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They're all free/no-fee accounts, and the juggling is the biggest factor for me.  Not a whole lot to worry about with these accounts, unlike credit cards that I might use and then quickly forgot I did....like the Discover I used a week ago, and only remembered when I logged in to check some rates.   As it is, I just "found" $2,000 I had sitting in a Chase checking account from a year ago that I had completely forgotten was there. 

I know...real big problems over here when I can forget I had 2 grand, lol. 

[AndySoCal]

@urbex  Currently, I have only one checking account. I recently came up a plan if my financial institution an internet bank was hit with a ransom ware attack how would I survive. I am a member of several credit unions none of which are in the state I live in.  I have money in savings accounts to open a checking account. Switching  my direct deposit is easy. If need be I could get a secure share draft loan  to bridge the gap if need be.  The credit unions shared branch and ATMs plus the free ATM's  I can walk to the corner of where I live and use the ATM inside the 7 11 with no fees.

[JSUB]

I have 3 separate institutions where I keep a checking account. My employer has a CU and that's where I do most of my banking for the last 19 years. I opened a C1 360 checking account about a year ago that averages about $300 any given month. I just opened a checking and savings account with NFCU that I DD $300 a month between them and have no intention of touching just cause. I can't imagine opening any more. 

[NoMoreDebt]

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@FicoMike0 wrote:

I agree with the "don't put all your eggs in one basket" idea. I have way too many accounts. I just closed two. Most of mine I opened for a sub or to establish a relationship. I only have one account that's not no fee, no min., So it doesn't take much effort to maintain an account with $10-15 in it.

Do I use my amex checking? No, but I have a credit card with them, so I have their app on my phone anyway. I also think they have a nice debit card design, lol.

Why have two brokerage accounts? I use fidelity as my primary checking and investment accounts, but robin hood offers no fee options trading. 

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In the same boat. Recently opened a Wells Fargo checking again just for the $325 sub. Already have a checking account with Chase just for our mortgage payment since they hold it and also NFCU.

Have a brokerage with Charles Schwab and Fidelity and checking account with each. Working on getting in with Morgan Stanley and eventually will only do our main banking through them and Charles Schwab and Fidelity getting away from the large retail banks. Will keep $5 in savings at NFCU to keep our membership alive but dont care about maintaining a "relationship" with Wells or Chase

[Hansolojr]

A good reason to have a larger number is to expand your set of potential lenders, especially for home loans where lending rates and criteria can vary from bank to bank.

My experience has been big banks have good rates but inflexible criteria, while credit unions are more willing to work with one-off situations.

I have my main checking at a large bank, but maintain basic savings accounts at 35+ CUs just in case one of them offers good home/auto rates when I need to borrow.  I opened those accounts over time for sign up bonuses or when the CU did not incur a Chex inquiry.  One can set up auto ACHs to keep those savings accounts active.

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@urbex wrote:

But are there other compelling reasons to have a larger number, or even compelling reasons to have everything at one bank/CU?

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