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Allow's keep it uncomplicated: There'southward no limit to the number of savings accounts you can open. The tricky function? Knowing whether or non it's worth it to have multiple ones.

While opening more than ane savings account may help you keep several savings goals (retirement, vacation, hereafter downwardly payment) organized, it could hateful more than monthly statements to track and balances to manage with potentially less overall interest earned across several accounts.

Your other pick is to keep all of your savings in one account. But, when all your money is held as 1 lump sum, it can be tricky to go on track of your specific goals and the progress yous've made toward each. So, how do you make up one's mind which savings method is all-time?

Read on to acquire about the pros and cons of having multiple savings accounts. Plus, find out how you tin divide your fiscal priorities and stay on superlative of them — all inside one single business relationship.

How many savings accounts tin can I open? Know the basics.

Savings accounts are generally piece of cake to open, and every bit nosotros already mentioned, at that place'due south no limit or penalty for having multiple ones. Online savings accounts tin can exist opened from but about anywhere and give you the convenience of 24/seven access to your funds.

When you open whatsoever type of savings business relationship, whether at an online depository financial institution or brick-and-mortar, be sure to compare minimum opening deposits, minimum residual requirements and fees, along with interest rates and customer service reviews.

Ideally, you desire to keep your money in a high-yield savings account to maximize your annual percent yield (APY). APY is the full amount of involvement you lot earn on a deposit account in a twelvemonth. It factors in involvement rates and compound interest.

Keep in mind, online banks like Ally Bank typically offering higher involvement rates than traditional banks.

Benefits of Multiple Savings Accounts

Sometimes, having numerous, separate savings accounts can be a helpful component of a robust financial strategy.

Some banks let you to link a savings account to your checking account to assist protect you lot from overdrawing. If a transaction would overdraw your account, as long as your savings account contains enough funds, those funds will be transferred to your checking account to keep it from existence overdrawn. In this scenario, the money in the business relationship could help yous avert a fee from your bank, should yous accidentally overdraw your checking balance.

In other instances, multiple accounts could help prevent y'all from spending your savings. How so?

A large gene of saving money is mental, and when you can see your money, you're much more tempted to spend information technology. If you lot're saving for a potentially large expense (similar whenbuilding an emergency fund , an essential colonnade of financial health) or long-term goals, you might think about opening a dissever savings account. Keeping a separate account might help remind you lot not to touch that account for other spending purposes.

With these funds out of sight, they'll be out of listen — reducing the urge to brand withdrawals.

If you gear up directly deposit, you tin automatically put coin in your account and allow information technology to grow — untouched and unseen — until you're gear up to use it.

Related: How to Put Your Savings Deposits on Cruise Control

Multiple savings accounts can as well be a positive move for y'all if yous're married or considering combining finances with a partner. While you might open a joint savings account for things like mortgage payments and your children'south education, you lot may both besides want to maintain your own personal savings accounts equally well.

Lastly, opening more than i account could be benign if your savings exceed the limit insured by theFederal Deposit Insurance Corporation (FDIC). FDIC coverage caps at $250,000 per deposit account. That means if you're belongings more than that amount in ane savings account, moving your excess funds to another account at a different FDIC-insured bank or financial institution tin can be a strategy to maximize your coverage and ensure protection for all your dollars.

Drawbacks of Multiple Savings Accounts

When you're saving for multiple things at one time, it's difficult to keep things organized. Opening separate savings accounts for each goal (new car, emergency fund, kitchen expansion) is 1 solution.

Simply while this strategy volition go on your money separated, information technology requires you to stay on top of multiple accounts and keep rails of numerous balances, business relationship numbers, and login credentials. Plus, you'll accept to deal with the inconvenience of transferring money across accounts — and perhaps betwixt dissimilar banks.

Non only will this crave some serious organizational skills, only it can too be time consuming and cause additional wait times during money transfers. Plus, if you exit certain savings accounts out-of-sight and out-of-mind for as well long, you might actually forget to tend to them — potentially stunting your savings strategy.

And finally, spreading your savings across unlike balances, accounts, and banks may get out you earning less overall interest, if the APY rates vary on the dissimilar accounts.

Afterwards hearing the pros and cons of multiple accounts, you're probably wondering, is information technology possible to become the positive aspects of multiple accounts without the negatives? Is there another option? Allow's compare.

Compare the Benefits of Multiple vs. One Savings Business relationship
Multiple Savings Accounts Our Online Savings Account
Go along sure funds out of temptation'south way in a split up account Organize multiple savings goals in i place with up to ten digital buckets
Separate a articulation savings business relationship from a personal one Visualize your progress on multiple goals at once
Avoid exceeding the FDIC coverage limit per deposit account Avoid tracking and balancing multiple savings accounts
Depending on your depository financial institution, protect yourself from overdraft, if you lot have multiple checking accounts Easily transfer funds between savings goals without limit

One Account, Multiple Savings Goals

For a solution that combines the ease of keeping your savings in one single account with the system of keeping your goals divide, consider our buckets tool, which allows yous to separate your savings into different categories (up to x), all inside 1 Online Savings Business relationship.

By divvying upward your savings in customizable buckets (you tin can fifty-fifty make ane for that designer bag y'all've been dreaming of), you lot can easily visualize the progress you're making toward all of your long- and short-term goals — no mental math required. You can take a quick wait at the balance in your vacation bucket, for instance, without having to subtract an upcoming house payment to check your progress.

This strategy tin can assistance you lot plan for all types of future costs, whether it's holiday shopping or an annual bill you want to set up for. Let'due south say your homeowner'southward insurance is $900 annually. If yous divide that amount past 12, you lot get $75 — then you know if you deposit $75 into the dedicated homeowner'south insurance saucepan each calendar month, you'll have plenty for the premium when information technology'due south due.

Naturally, your goals may change over time. That's why the buckets tool is flexible and can be easily adjusted to stay in line with your priorities.

Plus, no matter how many separate buckets you use, you'll still be taking advantage of compounding interest on the total corporeality in your business relationship — so you can continue to accrue coin on height of your already hard-earned savings.

Yous have multiple ambitions in life — equally well as numerous financial goals. It'due south time your savings account reflects that. With our Online Savings Account buckets tool, you lot tin can hands organize all of your diverse long- and brusque-term goals into digital envelopes to help yous become a savvier saver. And when done strategically, multiple savings accounts can likewise be a benign tactic on your journey to wealth wellness. When it comes to smart saving, in that location'south no 1-size-fits-all solution — and the best selection is the one that works best for y'all.

Make your coin perform smarter. Learn more than about Ally'southward new smart savings tools.

Get started.